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Checkers plays catch-up on rewards

Fills a vital gap in the group’s shift from ‘explosive expansion to precision retailing’ …
Shoprite Holdings has an almost unparalleled ability to roll out promotions – Checkers single-handedly launched Black Friday in SA – and will use this to its advantage. Image: Moneyweb

Checkers is finally in the rewards game.

Its Xtra Savings card, launched last week, promises instant savings of up to 50% across a number of items on promotion (excluding the odd halo deal, most discounts are in the 20-35% range). The first promo period sees just under 100 products on offer alongside its typical weekly or fortnightly promotions. Included are combo or bulk-buy offers as well as more generic discount pricing on certain products at its supermarkets and Liquorshop, when swiping the card.

This makes Xtra Savings similar to the Woolworths W Rewards and Spar Rewards programmes, which offer members discounts on specific products each week.

Like Woolworths, it also allows shoppers to opt in to supporting a charity or cause beyond the instant discounts (think ‘MySchool’). For every 10 swipes, it will donate R3 to a selected charity (Lunchbox Fund, Food & Trees for Africa or NSPCA) under ‘Swipe For Good’.  

All of these, however, differ from the two most popular cashback propositions on the market – Clicks ClubCard and Pick n Pay (PnP) Smart Shopper – where customers earn ‘points’ (effectively cashback) on each shop.

Read: Pick n Pay makes steep cut to Smart Shopper programme

Checkers (Shoprite Holdings) is the last major supermarket group to roll out a rewards proposition. It piloted Xtra Savings at some Western Cape stores in 2016, before shelving the project.

Retailers use rewards programmes to fulfil two vital roles.

For customers, they provide additional incentive – via discounts or cashback – to shop at a specific retailer.

More importantly, however, they provide invaluable data to retailers about their customers (and behaviour). As rival PnP pointed out on Tuesday: Smart Shopper has provided it with seven years of data to help drive business decision-making! And this data is shared with suppliers.

This is why in certain segments (wine, baby and pets), PnP has launched opt-in clubs that offer three times the normal Smart Shopper points.

You can bet this is funded by supplier rebates, showing just how beneficial this customer-behaviour data is.

Being late to the game means Checkers has a long way to go to catch up.

PnP has over 7 million active Smart Shopper customers, meaning it knows an awful lot about these people’s purchasing behaviour. It gives shoppers back over R200 million in points each year (at a cashback rate of 0.5%), and arguably didn’t quite realise how powerful the platform and data was until a good few years in.

Clicks has 7.6 million active ClubCard members, accounting for a massive 77% of the retailer’s sales. In theory, that equates to it knowing everything it possibly can about approximately R15 billion of its roughly R20 billion in retail turnover.

Right now, Checkers has a more limited understanding of its customers (likely mostly derived data). Central to this knowledge to date is dunnhumby, a global leader in customer data science. This little-known outfit, owned by Tesco plc, established a local office in 2012 specifically for Shoprite, and is part of the team that designed the Xtra Savings loyalty proposition.

Strategic focus

Filling the gap in its limited understanding is one of Shoprite Holdings’ nine strategic focus areas for 2020. In fact, its next era of growth (2020 to 2022) is premised entirely on the “shift from explosive expansion to precision retailing”.

Read: Micro marketing: Retail’s new fad 

One wonders to what extent its major suppliers pushed Checkers in this direction.

Reading between the lines, it is possible that it decided to first complete its fundamental (and disruptive) overhaul of its enterprise IT system before it went down the loyalty programme road. Given the strength of its centralised supply chain, it needed to be confident it was ready on the planning and fulfilment side.

In its 2019 integrated report, Shoprite makes the point that: “For 40 years, our innovative, cost-conscious approach to retail has served us well. Now, with our investment in digital transformation, we can use data to embed insights and analytics into our processes, and we will enable more agile decision-making across the supply chain.

“Our state-of-the-art supply chain ensures that each store is stocked for local needs and is able to adjust promotions, pricing, formats and stock at a granular level. Going forward, we will learn more about our customers from every change we make, allowing us to improve incrementally every day.”

Shoprite Holdings has an almost unparalleled ability to roll out promotions – Checkers single-handedly launched Black Friday in South Africa and will use this to its advantage (Xtra Savings members will get to see this year’s deals early).


And while it won’t catch up to PnP overnight, it has another huge advantage: Checkers doesn’t have any franchise operations (which typically adds complexity). It will keep driving this centrally, like it does with any other initiative.  

Checkers will learn what does and doesn’t work and can adjust the loyalty programme accordingly. Uniquely targeted rewards, such as those introduced by PnP’s Smart Shopper two years ago, will make an appearance soon.

Two years from now, the group may be surprised at how fundamentally this ‘simple’ loyalty card has transformed the way it operates – especially when it comes to more affluent customer segments.

Hilton Tarrant works at YFM. He can still be contacted at



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What I like about it is that there are no silly points to keep track of. You see instantly on your till slip what you have saved. That is simple.

Have already used Checkers card on several occasions. Its far better than all the other cards (PnP, Spar, Woolworths, etc., which I have). You really get good buys at substantial discounts. Well done Checkers.

Too little too late perhaps? Rather a leader than a follower be, also springs to mind.
Shop rite was the leader of the lower priced branding strategy with the NONAME brand. They were a leader in centralized buying and distributing, they were the leader in providing additional services through their outlets…and now they’re just becoming copycats? Not a confident sign and possibly the wrong way to go for their customer base.
The rewards policy of Woolworths is costing the business a fortune – the weight of which is being passed onto the customer. Shprite should rather keep their prices low and offer unique specials at certain times. Perhaps even lower prices of basic staples permenantly – they need to keep foot traffic through their doors. Better to do this with pricing – that would be reward enough for the stretched consumer who shops there.

Some good points. To add: No Name Brand is a private label brand belonging to PnP. Thus by implication you were referring to Shoprite’s own brand or private label. As for the cost of promotions, please do know that the suppliers typically borne those costs over and above the existing trading terms. Thus, when WW or whoever runs an ad campaign of, say a 10% discount, the supplier funds this. Very seldom does retailers actually carry the cost of special offers. In many cases they even insist on maintaining the margins too! As with Checkers, those savings are funded by suppliers who are fighting for marketshare, volumes, awareness, etc. Hope it clarifies.

Checkers may be “late to the party”, but at least it places them in a position where they learned from competitors’ previous mistakes, i.e. what approaches worked great, and what worked not so well.

Checkers/Shoprite pricing on numerous items (not through the bank though) are mostly cheaper than PnP…even when one adds in the (negligible) SmartShopper discount.

Checkers’s entry to a loyalty program will CLOSE THE GAP in this sphere, and over time nullify the advantage the competition had up to now.

I agree with others’ comment that “on the ground” the retailer with the lowest prices (in a price sensitive market like SA) should have the most feet through their stores. (..I say “should have”…NOT a guarantee. Look at Woollies.)

However, when marketed optimally, any loyalty program provides the “sizzle” that lead to more steaks being sold. Its overall monetary advantage (to the owner of business) its greater than the discounting sacrificed to customers…..I mean PnP’s loyalty program attracted many shoppers to their store, despite general higher prices than cheaper Checkers, just to satisfy the psychological effect to obtain SmartShopper points (which is a minuscule 1% effective discount). But to have “earned” something when leaving the store….makes one feel ‘oh so good’ 😉 (count ME in)

“See ya all at Checkers!” 🙂

On the one hand, loyalty scheme fatigue sets in. A fat wallet these days means it’s full of loyalty cards. On the other, the mental agility required to make comparisons on the fly is rumoured to ward off Alzheimers. What to buy where, who partners with whom and which bank card you use to pay – a multidimensional optimisation problem.

My PnP points mostly come from getting petrol at BP (which I do anyway because BP is a Discovery partner). My Emirates miles are reserved for flights with other airlines.

If PnP’s system knows all about me, why does it generate vouchers for things I don’t buy ? Why is it incapable of changing my email address ?

In the end the cost of all this comes back through the price.

I enjoyed a good chuckle here. PnP can definitely patch up their store operational compliance. I have serious trust issues with that lot. See they have reported good results10,5% increase on profit. By the way, there’s an app called Stocard which stores all your loyalty cards on your phone. I just whip the phone out these days wherever I go.

Instead of carrying all the cards in my wallet, I use the Stocard app. The teller scans the barcode from your phone.

And I use the local app Tribe Rewards to store all loyalty cards. I’ve used both and some stores still can’t pick up the cellphone screen (ahem PnP) but I still use tribe rewards since its faster.

Doesn’t their deal with FNB (shop at Checkers and earn E-bucks) count as a rewards scheme too? Quite effective for the FNB/E-bucks community

Yes, I get 15% discount after the low prices at Checkers, in eBucks level 5. To shop at P&P I have to travel an extra 20 km.

I am going to have T Shirts printed with : NO, I do not have a damned loyalty card!

If programs worked in favor of consumers, the retailers would not implement them

Like most consumers we go were we perceive the most value for our Rand with or without loyalty cards. Woolworths is by far the leader in fresh produce as 80% of their fresh produce outlasts the competition. All retailers have what used to be called leading losers to get consumers through the door. If you feel like you are saving you are more inclined to spend a little more on luxury items with higher mark ups.

End of comments.



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