ALDI takes aim at Coles and Woolworths over ‘pointless rewards’

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ALDI has taken a shot at supermarket rivals Coles and Woolworths, suggesting Aussies should switch and save money rather than collect ‘pointless points’ in search of rewards.

In a new TV commercial, a customer in a generic supermarket is referred to as ‘just a number’ and congratulated by zombie-like staff for her shopping loyalty over the years.

“Number 77531, you have been loyal for many moons and earned thousands of points,” the checkout worker in the TV advert tells the customer. “To commemorate this joyous occasion, we present to you this… plastic card!”

“Don’t get sucked in by pointless points,” the commercial says. “Switch to ALDI and save money instead.”

To support the advertising campaign, ALDI has also published an online calculator that it says provides a guide to how much shoppers will need to spend to earn enough points to claim various rewards.

Based on a weekly spend of $200, the ALDI calculator reveals that shoppers would need to spend $2,000 just to receive a $10 grocery voucher, for example.

To earn a 32cm frying pan, shoppers would need to spend more than $15,000. And to redeem a hairdryer, they would need to splash out almost $29,000.

The ALDI website notes that calculations are based on a standard rate of 1 rewards point per $1 spent.

ALDI’s head of customer service, Adrian Christie, told news.com.au that an average family would have to patiently wait one year and seven months to get enough points for a Tefal frying pan. The same pan costs just $60 to buy outright – the same amount the family could save on their shopping bill in just over two weeks, Mr Christie claimed.

The ALDI calculator also shows that, to redeem a 13-inch laptop with rewards points, customers would need to spend $382,000.

“It’s not a mistake that the words ‘loyalty’ and ‘scheme’ are used together as they are a scheme; there is some sort of manipulation going on,” Mr Christie said.

“A loyalty program is great for insights that can manipulate and can help shape the market. But in terms of value, is that value for the customer or for the shareholder?

“Loyalty schemes entice you to spend more, so customers need to realise what they are giving up for the rewards. If you spend $20,000, that might get a new toaster but if you were buying a car and the salesperson said: ‘We’ll throw in a free toaster,’ I’m not sure it would get you over the line.”

It is the first Australian advertising campaign from the German discounter that directly targets Coles’ Flybuys and Woolworths’ Rewards programs.

But the supermarket giants have hit back, saying that ALDI’s calculations aren’t a true reflection of how customers accrue points, and that rewards can be earned much quicker. They also point out that loyalty programs reward customers for simply doing their everyday shop.

A Woolworths spokesman told news.com.au that bonus points, member-only deals and email offers meant people could get money off vouchers far quicker than the analysis by ALDI suggested.

“Australian shoppers are savvy and know value when they see it. There are 11 million members in our Rewards program and we work hard to offer them great value across their entire shop,” the spokesperson said.

A Coles spokesman said Flybuys members could earn points not just at supermarkets but outlets including Target, Kmart and Medibank. Like Woolies, Coles said regular promotions could boost balances.

“Just last week, Flybuys members could earn 4,000 points for spending $200 at Coles – the equivalent of 10 per cent off their shop,” the spokesperson said.

Shopping loyalty and rewards points

A recent Canstar Blue survey of almost 3,000 consumers found that just four out of ten (39%) do all their grocery shopping with the same supermarket chain. Of those who do so, more than half (54%) gave rewards points as a reason for their loyalty.

However, convenience (64%) was the most common reason given for always shopping at the same chain, with store familiarity (51%) also a key factor. Just 32% said it’s because their supermarket is the cheapest and the same number cited quality products as a reason for their loyalty.

The survey also found that nine out of ten shoppers (89%) pay attention to special offers and promotions, with 58% admitting they often make impulse purchases.

Almost half of survey respondents (45%) agreed that they could probably save money by shopping at a different supermarket.

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