How Loyalty Card Schemes Suck You In and Rip You Off

Fri, Nov 20, 2009
Marketing
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44 comments

Loyalty card schemes may be costing you cash. I am outraged, and I have no one but myself to blame.

There are two grocery stores I shop at regularly: Albertsons and Ralphs.

Albertsons is a SuperValu store, which those of you in other parts of the United States may know as a Lucky, Bigg’s, Cub Foods, or Jewel-Osco. Ralphs is a Kroger brand. (And both of them seem to have abandoned their apostrophes for branding purposes, but I digress.)

Ralphs is a 7.1-mile round trip from my house. Albertsons is 0.8mi and easily walkable. Yet I almost always go to Ralphs.

I finally figured out why the other day, and promptly became supremely irritated with myself. I was in Albertsons, about to buy $30 worth of groceries. Then my brain screamed, “You could be getting cash back for these if you had gone to Ralphs!”

You see, Ralphs has a loyalty card. (Those of you who shop at Kroger know it as the Kroger Plus Card.) Once you spend $500, they mail you a $5 gift certificate. Then, every time you spend another $100, they mail you another $1. They calculate these discounts four times a year. I have seen people in the store redeeming certificates worth as much as $16. That’s $1600 in groceries in 3 months! So, clearly, the card works.

Are Loyalty Cards Really a “Deal”?

Let’s do the math. Is Ralphs loyalty card actually a deal for me?

My car gets just under 30mpg — let’s say 28mpg for easy math. So I’m burning a quarter of a gallon of fuel every time I choose Ralphs. I burn only 7% of 1 gallon to drive to Albertsons.

Assuming a gallon costs $3, it costs me 21.4 cents to drive to Albertsons (and I could easily walk, saving even that.) It costs me 75 cents to drive to Ralphs. I’m saving 53.6 cents every time I go to Albertsons.

Assuming (for the sake of argument) that their prices are the same, I’d need to spend at least $50 every time I go to Ralph’s…just to break even on the gas money I spent to get there!

Does Ralphs have lower prices? I don’t think so. In my comparison, the prices between the two stores are nearly identical, and are only offset by specials. Ralphs loyalty card only makes it appear that Ralphs has lower prices.

It’s the mental mindf*** that makes me so upset; that irrational nag I get in my brain every time I shop at a store other than Ralphs. The one that says, “You could be saving money, and you’re not!” That same nag ignores hidden costs like gas money.

What Can We Learn From This?

The point of this post isn’t to show you how you, too, could save 53.6 cents. The point is to understand that we are often driven by emotional impulses that we truly believe are rational decisions.

“I save money by shopping at Ralphs” would be a statement that, on its surface, appears to be correct. Doing the math and unearthing the hidden costs proves it false. (I didn’t even calculate extra car wear and tear, and extra time on my part spent driving there and back!)

Loyalty card schemes are designed for people who want to feel good about saving money. In most cases, however, I doubt they actually save us much money.

Loyalty card schemes reward you for buying a full-price item at one store instead of finding the cheaper one somewhere else. They reward you for shopping at the same place every week instead of looking at the specials and deciding where is best to shop that particular week. And they do this by inserting an insidious nag into our heads; one that says, “If only I had shopped there instead…”

As Henry Hazlitt wrote in Economics in One Lesson, “The bad economist sees only what immediately strikes the eye; the good economist also looks beyond.” Looking beyond and calculating the real cost may show you that what you thought were some of your most rational decisions were really just rationalizations.

Next time you shop at a particular store or buy a particular item, think about why you are doing it. Are the prices really lower, or do you just think they are? Have you taken the time to seriously compare? Are you driving out of your way to save a few pennies when you could shop closer to home…or maybe even leave the car in the garage?

Are your choices rational, or rationalizations?

Recommended Reading:

Economics in One Lesson by Henry Hazlitt. I strongly believe that if everyone in the U.S. read and understood this book, we wouldn’t be in the economic crisis we are now. It’s absolutely worth reading, and it’s also an easy read.
What Can You Do to Help Solve the Credit Crisis? Spending money isn’t the right way to help our country. What is? I give specific details.
Why You Don’t Save for Retirement. Does saving for retirement seem pointless to you? I felt that way, too, until I figured this out…

Loyalty card schemes photo credit: joelogon

Rico Garcia says:

11/20/2009 at 11:52 am

The truth is: To get REAL discounts you need to use coupons. There are ALWAYS opportunities to actually have cash handed back to you if you coupon shop the right way (stocking up on items you have coupons for, waiting to buy things you don’t have coupons for).

It’d be interesting for you to research the 12-week sales cycle grocery stores have, and report back. Sales/coupon combination shopping can be HUGE savings. And, grocery stores love coupons because they actually make money on them (they charge the manufacturer a processing fee for taking the coupon). So, if you use a coupon for $1 off, and there is an 8% processing fee (the norm), the store will save you $1, but will actually get $1.08 from the manufacturer.

It’s why, if you ask nicely, the cashier will often scan their copy of the coupon for you. Store management encourages that. 😉

Carol says:

11/20/2009 at 11:53 am

I love this article!

We have a grocery store that is less than a mile closer than walmart, and has the loyalty card. (for gas) And double coupons, and they run specials each week – buy an “X” amount and get 40 cents more off a gallon of gas.

I know prices very well in both stores, so I ONLY buy what we need at the closer store 1) if after doubling the coupon, it is truely cheaper, and 2) wiLL ONLY buy the specials IF CHEAPER THAN WALMART AND IF I REALLY USE THE PRODUCT.

To many people get caught up in the “oh my, I get 40 cents more off my gas, when they spent way more than that on groceries!

Sorry to be so long winded…..but you have to “play the system” to get the deals.

Thanks for the article!!!

Carol Wingert

Ted Pawlikowski says:

11/20/2009 at 11:56 am

Erica – I think you are a pretty sharp lady, but you’re wrong about this. A loyalty card is no substitute for knowing what the items you are purchasing are worth, but as long as you are an informed shopper, they are a bonus that are worth having. All things being equal (and saving gas is a situation unique to you) the loyalty cards are worth using.

Christina Gremore says:

11/20/2009 at 11:59 am

The whole reason most of those stores offer “loyalty cards” is so they can track your purchases, then sell the information to advertising companies. That’s the real rip-off, in my opinion. But I mostly shop the perimeter (fresh produce and meats) and the bulk aisle, so I don’t feel too manipulated by the food companies. Did anyone get a chance to read the article in the NYT (http://www.nytimes.com/2009/06/23/health/23well.html) about how food companies engineer their product “to reach the precise point at which we derive the greatest pleasure from fat, sugar and salt.” Scary. (But oh, so tasty, too…

Rafael Marquez says:

11/20/2009 at 12:02 pm

I think it all depends on the loyalty card. We use a CVS loyalty card and get discounted stuff all the time. The CVS, Walgreens and supermarket are all about the same distance from my house so picking one over the other costs the same in gas.

steve says:

11/20/2009 at 12:07 pm

Don’t feel bad, we have all been taken in by these kind of things. I was in a sales, but still fell for the old, “just take it with you & return it if it doesn’t workout for you” gambit. And this was for a new car!! I find myself in a contract paying 14.75% interest on $18,000 car for a total of $32,000 over a six-year period. (This year my gross income dropped from 24k to 20,000!!!) I could have bought that same car two years later for $10,000 at 0% interest!! Whether you use your example or mine, the lesson is still the same: one of the best ways to pay yourself is to truly think about how you’re spending your money!

Daniel says:

11/20/2009 at 12:08 pm

I really love the sentiment here. I enourage my readers to embrace what I call “brand disloyalty”–the concept syncs up well with your views.

It’s so easy to fall into a habit of buying the same product or shopping at the same store over and over again. The BEST kind of customer (in the eyes of a retailer or consumer products company at least) is a habit-based, unconsciously loyal customer. And consumers who let habits dictate their buying decisions simply disempower themselves.

Dan
Casual Kitchen

Peter Yaworski says:

11/20/2009 at 12:11 pm

Excellent post, I’ve found myself doing the same thing with my Indigo Chapters card buying books (Indigo is in Canada, not sure if they are in the states too).

Another strategy to the loyalty card are the rewards credit cards (recognizing it only really helps if you can control your spending with a credit card). I have a dividend mastercard through President’s Choice (in Canada). PC has a financial branch but also spun out of a grocery chain. As a result, using the card you get 1% back on all purchases at any store, to be redeemed at PC grocery stores. Granted though, this is only effective if the grocery store isn’t over priced compared to others and you don’t have to travel far to redeem your points.

Karen Kay says:

11/20/2009 at 12:24 pm

Hi Erica!

Mileage is a good reason to shop at the closest store, but I think an even better reason is because they don’t use the cards. If they are giving folks cash back, then they must be making back the money somewhere. I bet if you did a price comparison on every product you would find that Ralphs is charging more overall.

Using Diet Coke as an example… since I am a Diet Coke-aholic, I know where to buy it the cheapest. I have noticed our local “carding” store claims a “cardmember discount price” on an ongoing basis. However, the other non-card store where we shop sells it cheaper than the “discount price”. Meanwhile, that “discount price” keeps going up, while it has stayed the same at the other store for over a year now.

They give the cardholder all kinds of “rewards”….gas coupons, percent off coupons, etc. All to mask the fact that they are raising the prices nearly weekly on stuff we buy all the time.

Ugh!

Karen Kay

ps….I love how the Best Buy rewards card in the photo is the most used one in the bunch…knowing you, that does not surprise me at all! lol

pps – Hi Carol! I agree with you, but many times, alas, the convenience of not having to go to multiple places wins. I also avoid WalMart as much as possible…both of these have to do with the fact that I try to save time as much as I try to save money.

Larry says:

11/20/2009 at 12:31 pm

Erica,

I agree with what you said in the “How Loyalty Card Schemes Suck You In and Rip You Off” article. One major issue I would like to bring up.

In order for a shopper to receive the cash back money, they had to give their real name and address. Whoa! Big mistake.

I have several loyalty cards (CVS, Kroger, Randall’s/Safeway, etc.). I have never given my name – at all. Not even a fake name. I just get the card (or a replacement card if the plastic wears off the old one [from rubbing against my keys on the key ring]) from the Courtesy Booth.

Why no name? I never want them to be able to track me and what I buy in their system. I am even working on switching from a debit card to cash. By using a loyalty card, they can form a profile of your shopping habits which they can exploit, sell to a third party or be reviewed by the government.

Do you buy any (or a lot of) condoms (sexually active?), the morning after pill (sexually irresponsible?), birth control (sexually active?), lots of alcohol (an alcoholic?), tobacco products (smoker?), rolling papers (-may- be used for wrapping marijuana cigarettes), adult magazines, children’s items (you have kids?), pet items (you have pets?), high fat foods (poor diet habits?), single serving frozen foods (a single person?), only fruits and vegetables (vegan?), never any diary products (lactose intolerant?), rent in-store DVD’s (what type, what rating?), food from the sugar-free section (diabetic?), diet aids/drinks/foods (overweight?), mainly Hispanic foods (here legally, illegally?), “black” hair care products (racial indicator), etc.

Any one purchase may not say a lot; but being able to track your purchase over a period of time, the store (and the government) can tell a lot about a person – how they live, lifestyle, habits, preferences, etc. My lifestyle (good, bad or otherwise) is none of their business. So no name is associated with my loyalty card.

I saw an old black and white movie a few years back where a man was an accountant. He was helping a woman with some financial questions. He told her just by looking at her checkbook, he could tell everything about her (beyond where she shopped). He reviewed her checkbook and began telling her all sorts of things about herself. She was shocked.

It is not the stores business, any third party or the governments business what I buy or how often or how much. No name associated with my loyalty cards.

Sincerely,
Larry

P.S. I like watching your videos (not in a creepy way, but in an admiring way); you are so cute.

A says:

3/19/2010 at 4:35 pm

Larry may sound paranoid but it’s true.

Both Safeway and Vons have been involved in lawsuits and mediation where they were known to be reviewing their customers purchase records and trying to claim that the customers “bought a lot of alcohol” in an attempt to try to shame the person away from suing or to discredit their case.

Everytime I go into Safeway the liquor section is HUGE and growing and they seem to be running more liquor ads in my area. Talk about being hypocritical!

Reply

Jonathan says:

11/20/2009 at 1:08 pm

Hi Erica,

I’m not trying to be a smartass here, but the title of your post seems to imply the loyalty cards themselves are ripping you off, whereas your post seems to say the USE of loyalty cards might not be worth it for you. In other words, you were losing hidden money, but that had nothing to do with the cards themselves.

Ed Young says:

11/20/2009 at 1:56 pm

Erica,

If you have stores that frequently have “buy one get one free” offers, you can combine those with manufacturer coupons and save even more on certain items. Of course, a lot of the items that are like that are the junk food items, but we frequently get staples such as spices, cooking oils, cereal, frozen entres, meats, etc. We have an Albertson’s nearby, which offers some great “buy one get two free” on meats and I can also use that coupon at the local Publix store as well. Many stores will match a competitors price without having a loyalty card.

Also, my wife reminds me all the time that when I am shopping for the lowest gas price, that in the grand scheme of things, on a fill-up, I am only saving a few cents per fill-up, but spend more than that driving to the low cost station a few miles out of the way. The old saying, “Penny wise but pound foolish” comes to mind. Now, I buy at stations that are on my way to something and don’t worry about the couple of extra cents I could have saved.

Chris says:

11/20/2009 at 1:58 pm

THAT’S partly why I will go to a Publix grocery store over any other in our area. Prices are in line or better than SweetBay or Winn Dixie AND they decided NOT to go the loyalty card route. They have weekly shelf specials and a lot of BOGO offers that are available to everyone – without having to give up any personal information or keep track of that stupid piece of plastic. AND, they still adhere to the policy that if it says “5 for $5” and you only want to buy 2, they are STILL only $1 each instead of a higher price.
Gary Vaynerchuck has a new video out about how with the spread of all the various social media venues, we are all becoming so connected that we are going to have to go back to “small town values” and watch the personal connections. Offering me phony discounts or small amounts of cash back in order to mine data from my purchasing habits doesn’t seem very “neighborly” to me.

Carol says:

11/20/2009 at 3:06 pm

I agree too, that the BOGO are great, especially when you have a coupon!
I get my laundry detergent that way, and pay less for two bottles than I do for 1!

Had coupon for a free pack of beef Oscar Mayer Beef Hotdogs, got them used it when the sale was buy one get one free, and guess what! Yep, 2 packs for nothing! Cat food went on sale, the brand I buy ($3.00 off the bag), and if you picked up 3, you got the 40cents off a gal of gas.
Since I use the catfood, I picked up three, not only saved $9, but got my Gas at a lower price.

You really do have to do your homework.

Carol

Stew says:

11/20/2009 at 3:18 pm

Hi Erica,

This post got me thinking in a number of ways, but you know I confess I believe thinking this small is really deleterious to your mental and spiritual health.

I know it isn’t about the 53 cents, but you thought about it, ruminated over it, felt victimized, and got crappy enough inside to write about it. Can you imagine what your biochemistry was doing the entire time? I wish you had stuck to the other great topics you have explored.

I like rewards cards and find them beneficial used correctly. As so many here have said the trick is not to fall for the hype and buy products you don’t want or need. I’m big on purchasing lost leaders and adapting my menu to what is on sale or in season.

Then too, stores have become so competitive in this down economy that real deals exist. the stores in my area have taken to posting competitor’s prices under items, saving me valuable time (if my travels take me into the area of a competitor’s store, I check to make sure they are telling the truth).

I have no desire to waste my time driving around to save a few pennies here and there. I’m too poor to do things twice. I don’t live extravagantly but I buy the item of the best quality I can afford and move on satisfied I did the right thing.

My friend is always looking for the Rolls Royce being sold for Volkswagon prices and spends way too much time scanning ads for the best deal on stuff I would never buy in the first place. Heaven forbid they use the word “free”.

I can not tell you how much of my life I have flushed down the toilet standing on return lines because she found it was junk or she could some questionable substitute product $2.00 cheaper at a store 6 towns over.

I told her, why not make a business that you could sell for a million dollars and live off the investment interest. Given a conservative estimate of 8% return she could make $80,000 on top of what she already makes, which would put her in the top 15% of income earners. I said most people can raise families on far less, but more importantly,then your mind won’t be on chump change, but rather on doing things that matter.

Sophia says:

11/20/2009 at 3:36 pm

I didn’t read completely through all of these posts so perhaps someone has addressed this already. Ralphs is acutally named after the original owner – George Albert Ralphs – who opened his first store in Downtown L.A. in 1873. Hence the lack of an apostrophe; no branding purpose or gimmick there.
Also, not all Kroger-enterprise stores offer the rewards program that you’re referencing. Loyalty program, yes (i.e. – Kroger Plus card, as you called out) but the combination of a loyalty/rewards program is unique to a handful of chains including Ralphs.

Pat says:

11/20/2009 at 5:59 pm

There are 3 grocery stores and a super walmart within 5 miles of my house, closest is 1 mile. In two of the stores, if you want the sale price, you have to have the loyalty card. No card, no sale price. I have the cards, with name and address, because they have products I use that the other stores actually don’t have. The one grocery without cards is a fine, low-price-point store. I shop there first if I have a lot to buy; but I find the produce isn’t as fresh or large as the carded stores, which run a higher price point/market nitche. I try to plan ‘bottle of milk’ trips when I’m passing by a store.

There is one other higher end store about 10 miles away with a card that’s just gone ‘weird’ like the ones you all are talking about. I transferred my old account before I realized, there’s nothing in it for me…I only buy soy ice cream and a few other not common items there. Think I will ask them to take me out of their database and destroy my card…but then if the ice cream goes on sale… it is $2 or more off…

Can you remember what it used to be like in stores? When there were barrels of dry beans instead of small bags of ‘soup beans’? Back when a ‘TV Dinner’ was a fad? We’ve come along way and I’m not at all certain the travel has been in the right direction; but it’s where we are… for now. We can change, but Erica is right. We can only change our direction when we have taken the time to figure out where we are. Then we have a starting point to map out our personal route to our blessed lifestyle.

I enjoyed everyone’s input. Thanks.
Love and Light,
Pat

Brandon W says:

11/20/2009 at 6:17 pm

I hate rewards cards because I hate carrying them, or having to pull it out to get a price that ought to be the regular price to begin with. Just sell me your product and give me your price. I hate driving long ways to a grocery store. I grew up in a rural area where it was a 15 mile round trip to get to a grocery store (the 2nd closest option was a 22 mile round trip), so I now refuse to go over 5 miles round trip. And that’s actually my biggest stretch… I drive 2.5 miles to a store I like better with better prices rather than 1 mile to the nearest store. And lastly, I refuse to use U-Scans, on principle. They’re just offloading their costs on me, instead of hiring a cashier. So someone’s out of a job and I’m having to do their job for free.

I don’t know what my point was when I started this. I’m tired. But if the prices are comparable, I can’t fathom driving 7.1 miles to a store when a perfectly good one is just up the street. My time and sanity is worth more than a few pennies either way.

CHUCK says:

11/20/2009 at 6:24 pm

Yes, I’ve fallen for the same thing, repeatedly. However, about a year ago I began really inspecting each and every purchase situation and purchase. Boom Badda Bing! Sorry Wally World, you Don’t necessarily have “Everyday Low Prices”. Fact is, I had to train myself to be very observant when shopping–for EVERYthing, not just groceries. What surprised me was that it isn’t just the occassional rip-off setup I found retailers of every type engaging in–It is ALL of them.
The secret services in our country have a motto–Trust, But Verify. I’m told they got it from the Russians. Ain’t that a twist?
It wasn’t hard, easy actually, to get into noticing and calculating the differences and making educated decisions Before the purchase, rather than kicking myself After.
Thanks for the Information, View and Review, and the Encouragement Erica!
Onward, to better shopping ! “Its Ok, to say no.” “Its Ok to just decide not to buy anything today, and leave with nothing, rather than leave Ripped Off.”

CHUCK A.

Steve says:

11/20/2009 at 7:38 pm

Hey Erica – I really understand why you feel this way.
(After all, I have run on a “budget of nothing” for as long as I can remember now.) However, I can actually walk to Ralphs, since it is within walking distance. Albertsons is perhaps a ten minute drive away, but I haven’t been in ages, because I am to busy to do the extra leg.
Here’s another funny story, along the same kind of lines.
A girl I work with, let’s say her name is Jane, caught me purchasing a trail mix bar or 85c in the work vending machine.
“Ha ha!” she said “I just paid less than a dollar (99c) for eight of those bars you just bought for 85c in the vending machine.”
“Where did you do that?” I asked. And she told me. Rather than fuming, I laughed and asked her where the store was. Well, the 99c store was a considerable number of blocks away and not on the way home. If I went during the lunch hour, I would have to give up my parking space (because someone would just drive in there! And all the other vacant spots seem to be under trees which have some fruit which drops on to my hood and canopy and messes it up!)
So I thought maybe I’ll get some cheap trail mix bars at my local 99c store at the weekend, if I think of it and if I happen to be driving past!
Well Erica, big long story, illustrating the fact that sometimes there is a very thin line between being more trouble than it’s worth and more worth than it’s trouble!
Hope you have a great weekend! Keep these coming! I read every one!
By the way, your anti-spam question is painfully stupid. I answered “Sure – aren’t you?” (and it didn’t like it), to the question “Are you a human being?”
Warm wishes,
Steve

Joshua Skaja says:

11/20/2009 at 10:43 pm

Economics in One Lesson is indeed a great read.

The reason I don’t shop at Jewel or Dominic’s (Albertsons or Safeway for people outside of Chicago) is that there is simply no way a union shop can compete price-wise with the three (fantastic) non-union grocery stores I have access to.

Erica Douglass says:

11/20/2009 at 11:08 pm

Tons of great comments on this post! I think my favorite comment is probably from Stew. Yes, I do think obsessively about this. It comes from my mom and my childhood. And you’re right–it’s not healthy. I have been breaking the trend for a while now. The first step to changing something is to realize it exists, and that’s what I have been doing with this. I had to realize this “mindf***k” (as I called it in the post) existed, and realize it wasn’t logical, before I could make the change.

I’m on my way to being better about this stuff. 🙂 And yes, plenty more blog posts on the business side coming up. It’s just nice to take a break from talking shop all the time!

-Erica

Stew says:

11/21/2009 at 2:43 am

Hi Erica,
Thanks for the follow-up comment. You are absolutely right that you can not defeat an enemy you do not recognize. I had a chuckle because actually you and I are very much alike on this.

In my family it became a pathological obsession because of the Great Depression; which ironically gave this way of thinking validity. Even when the good times returned, my grandmother would use a small piece of bread to get those last bits of tuna fish out of the can or the juices from the cooking pot.

It’s what I call a generational curse and it is a hard habit to break, but it can be done. My own first step was getting angry about how much time and energy was being sapped from my life thinking this way. I changed my internal dialogue and when I focused on achieving loftier goals the angst dissipated and I became much more productive and financially solvent.

greg cryns says:

11/21/2009 at 6:16 am

I love articles like this. I really chafed when the stores introduced the “club cards” many years ago. I knew what they were doing (loyalty and database info combined) but I couldn’t beat them because they all jumped on the bandwagon. It just seems silly to be forced to use the card and I’m not sure I like my actions being monitored.

Beth says:

11/21/2009 at 6:25 am

This post sure hit a nerve with people. In this economy and “tracking society,” groceries, loyalty cards, and saving money are hot topics.
We are not going to get away from having our privacy invaded. Unless you spend cash for everything and pay more by not using loyalty cards and never filling in forms anywhere and don’t even own a car or a house or go to the doctor or dentist or college you will be tracked somewhere in your adult life. The internet has made it possible to buy any government records. You social security card, now issued as a baby, has made it impossible to get away from that really if you are not an illegal who lives in a cave.

Amazon.com, Netflix, and other online retailers use cookies to help you find things easier so they will generate more sales and make your shopping experience personalized. They recommend things based on your past purchases or rentals. One of the grocery stores in my local area that I like the best sends excellent high-value coupons in the mail based on my past purchases- for milk,produce,cereal,cat food, and more. They also offer me lower prices than Walmart and the other local stores, double coupons, and give me money off gas purchases.

I believe that those who are good stewards with their money will generate more. For that reason I do use coupons, look for deals and rebated, compare prices, and more. I am not obsessive about it though.
I’ve been doing it so long it is second-nature to me and takes little time for the huge savings. I stock up when things I regularly use are on sale. Candy,good for my spirit but not my health, I buy after holidays when it gets 50- 75% off. Amazon.com offers some food in bulk and a couple times they have had great sales with free shipping on certain items I buy. I just discovered alice.com which ships staples with free shipping if you buy six items. The prices were a little higher over-all than in my local stores, but not significantly. Considering it is almost 45 minutes drive to my main grocery area from the small town in which I live that is a big time and gas savings. CouponMom is a great coupon site that lets you know what the best deals are at the stores in your particular local area, including drug stores, as well as letting you print coupons.

There are also many ways to purchase something and help others online.
The hunger site and the others connected- breast cancer,rainforest,animal rescue, literacy, child health give money to good causes with each purchase. They offer unique, high-quality products made by needy people throughout the world. They offer fair-trade items, sometimes offer free shipping or something free with purchase and you feel so good after buying from there. Recently I bought new walking shoes from one of their sites and they gave a pair free to someone in need. The size I wear is unavailable almost everywhere- a woman’s 10 1/2 so I have had to purchase men’s shoes for several years. I now am so excited to have quality woman’s shoes that fit well and look better on my feet.

My point- take reasonable care to make a purchase you feel good about.
This has become fun for me.

TeresaA says:

11/21/2009 at 7:00 am

They real key is to use the loyalty cards, stores sales, BOGO’s and coupons to your advantage. This can be done without being obsessive, creating lists or spending hours rummaging through store ads. I have three main stores within a two mile radius of my home. I know from experience what products to buy at each store. Store A has superior produce at much lower prices than Store B. Store B tends to have more BOGO’s on the basic stuff I need. Store C is usually the best bet for cleaning and personal care items. However, since I am in each store often, I can pick up on any additional sales and deals any of them may be offering. All of them have loyalty cards. I LOOK AT THE LOYALTY CARDS AS AN EXTRA PERK, NOT A REASON TO SHOP THERE.

Then there are the exceptional stores that are usually out of my way. There is a farmer’s market that I love that has even better deals on produce, deli meats and cheeses. They also offer items you won’t find in your typical grocery store. I stop here when I know I am going to be in the area anyway, or I sometimes make a special trip because it’s worth getting farm fresh green beans for $0.69 per pound, turkey breast from the deli at $3.99 per pound and home grown apples for $0.99 per pound. It’s worth the 10 mile round trip, and they have a loyalty card too. ($10.00 for every $400.00 you spend.)

Trader Joe’s is out of my way. Probably 16 miles round trip. But I sometimes make a trip out there for some other favorite stores, or to meet my daughter for lunch or dinner. Trader Joe’s is a wonderful place. Quality at an everyday reasonable price. Fun stuff too. But it’s fun stuff you can really use. If you have ever shopped there, you know what I mean. I like Trader Joe’s for bread, stuff for kids lunches (like granola bars), eggs, cheese, peanut butter, chocolate (for eating and baking), snack stuff, wine, coffee, tea, etc. Better for you stuff at better for you prices. All in all, it’s probably worth going out of your way.

Then there are coupons. Coupons are only worth your time and effort if they are for something you can really use, purchase a lot, and give you enough value. $1.00 of on a tube of toothpaste that is already on sale for $2.00? Definitely worth my time. Probably paid for my gas to get to the store.

Bottom line…know your stores, find the positive things about them and use them to your advantage. Treat the loyalty cards and coupons as a little “icing on the cake”.

Natalie says:

11/21/2009 at 7:55 am

I completely agree with and follow TeresaA’s logic.

And I don’t give a hoot about store/government tracking. It’s not like they start charging you more for the products that you’re buying; and I’m not a criminal that’s trying to hide something. So why sweat it?!

Clark says:

11/21/2009 at 10:54 am

Christina touched on something that we’re all missing here. Erica’s analysis and comparison shows the true cost comparison between the local and loyalty store. An even wider, high-level perspective would point out the positive health benefits of avoiding a large number of the food items advertised for sale. Okay, cat food, yogurt, toothpaste are fine from most grocery stores but the doritos, soda, pizza, frozen foods are going to cost us all down the road. It’s taken me over ten years of skepticism and denial, and ss much as I dislike paying a premium for organic foods I do it.

TeresaA says:

11/21/2009 at 1:39 pm

Thanks Natalie, and I agree with you on the tracking issue. It’s not a big deal….I am not doing anything particularly interesting or illegal. If you are worried about it being an invasion of your privacy, then you’d better give up your cell phone, the internet, your Facebook account and your credit/debit cards…..just for starters. If I do decide to “fall off the grid” someday it will be because the world is starting to get a little scary…LOL.

And Christina does make a great point too. Save your self some money and save your health….skip the processed stuff. It’s true…they really do have chemical engineers and colorists playing with your “food”. There are huge laboratories and kitchens where scientists work to formulate chemicals, flavors, colorings, etc. to entice your tastebuds and make that processed stuff seem soooo yummy!

Mackenzie says:

11/21/2009 at 9:27 pm

This seems to all come down to “I live in an area which is stupidly unwalkable and thus waste money on gas.” I can walk 4 blocks to Safeway, 6 blocks to Yes!, or 12 blocks to Whole Foods. I think only Safeway of those has loyalty cards, but none of that stupid “spend money and we’ll send you a coupon,” just plain old “if you’ve got the card, you save $1 right now.”

Which store I go to depends on what I want, not a card. If I want dried beans, I go to Whole Foods because it’s got a great selection of them in bulk. If I just want some carrots and apple juice, I go to Safeway.

Prime says:

11/22/2009 at 7:01 pm

this post reminds me on how i was suckered three years ago into buying a starbucks planner in manila. i thought i was saving money because i will get a free planner after buying about a dozen starbucks coffee. hah! well it’s not free. i did the math and i learned that regular trips to starbucks cost me roughly 100 USD in just two weeks!!!!!!!

the year after, i chucked starbucks (and even advised other people to do the same), and bought myself a a nice(and better) planner for less than ten bucks.

Omar says:

11/30/2009 at 5:32 pm

I’m not into rewards cards. I rather shop at a place that has great customer service. But I do need to stop shopping at a neighborhood discount store that has only one cashier throughout the day. But I don’t mind paying extra at a place that makes me feel appreciated. Thanks for the article Erica.

GE says:

12/5/2009 at 9:39 am

A nice analysis, but let’s simplify things. Nothing is free. You’re paying yourself, because prices are raised to cover the cost of your “rewards”. Loyalty also undermines competition – the more disloyal customers are, the more shops are kept on their toes. Retail loyalty is a con.

zenk says:

12/10/2009 at 6:16 pm

“I save money by shopping at Ralphs” would be a statement that, on its surface, appears to be correct.”

Actually, I read that statement, and say “self, that’s complete crapola”.

It is impossible to save any money by purchasing things. You might spend “less” than somewhere else if all variables are taken into account, which you actually started to do here. But you haven’t saved anything at all. You spent.

Its the most devious of marketing, and its everywhere. Train yourself to laugh at it. The idea that you “save” by purchasing and so it is therefore a good an wholesome thing to do in general is simply a pervasive perversion of purtian ethic.

Mike says:

12/27/2009 at 9:29 am

the card programs arent there to save you money, they are there to make the retail chains more money. you know there can be no other reason.

other factors you should consider, read up on

http://www.consumeraffairs.com/news04/2005/loyalty_cards.html

http://www.nocards.org/

Sabine says:

2/13/2010 at 1:32 pm

Hello Erica

my answer to this is to have a loyalty card for every shop in my area and every shop near my work and on the commute to and from work. My Credit Card wallet looks a mess (no CC cards in there though), but I end up shopping where it is either most convenient or cheapest. I don’t tend to collect too many points on any of the cards, but I just use them as an added bonus, as the stuff would have cost me the same if I wouldn’t have used them. The only problem is when we are moving house – what a nightmare to change addresses on all these card. And the companies they sell the information to ? Well, they must be sick of my name by now, lol. I must be appearing in every single list of theirs. If it stops Viagra adverts hitting my e-mail-box and instead tells me where I can get the cheapest Diet Coke this week (fellow addict here), I happily give this inormation away – although I am not getting my hopes up 😉

Have a nice day

b w says:

4/19/2011 at 1:48 pm

I just want to point out a truism that’s never wrong. There aint no such thing as a free lunch.

The goal of loyalty promotion programs is to confuse the consumer and make it more difficult to price compare.. period. The collection of personal information for sale is secondary, and for many businesses that money is actually collected by the third party who manages the loyalty promotion program.

I’ve been involved in the software side of these programs for over a decade…

Dan Baker says:

6/7/2011 at 4:27 am

Loyalty cards just encourage shopping at high priced stores!. Walmart doesn’t use them, neither does ALDI. in fact it cost companies to operate the cards through database maintenance, IT people, advertising, and printing the cards!

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Ingo says:

7/23/2011 at 3:28 pm

There’s something I don’t get, but might be obvious to residents.
I am a visitor from germany and just visited ralphs. Every second item (of not more) had a respectable discount for card owners. By respectable I mean about 10% and more. This is much more than I think you can save with loyalty card systems in germany.
Now, I guess these discount prices are the actual prices, and I as a visitor am the idiot who pays more than others. Is that true? What store should I visit to buy?4
Thanks for your help

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9/2/2011 at 11:20 pm

had a respectable discount for card owners. By respectable I mean about 10% and more. This is much more than I think you can save with loyalty card systems in germany.
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