Morrisons pins hopes on loyalty card

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In an attempt to attain an increase in sales and brand loyalty, Morrisons released a new “Match and More” card which “awards points equivalent to the difference in the price of items that are cheaper in supermarkets” which can then be converted into vouchers. This additional service gives Morrisons enables it to compete with supermarket brands that have been focusing on the cost leadership strategy: the discount chains. It also results in brand loyalty as customers will constantly return to accumulate points. Furthermore, this loyalty scheme may also act as a point of difference as Morrisons is the first supermarket to provide a price match guarantee.

An important question to consider is whether Morrisons can maintain this competitive advantage – the advantage of possessing advanced technology that allows for the comparison of thousands of prices. Because it is speculated that the program is very costly and therefore more difficult to copy, it is unlikely that other firms would implement the same system; it is likely that the competitive advantage will be sustainable. This raises another problem because the heavy cost involved in investing in attaining the comparative advantage may hinder Morrisons, who have been suffering from profit losses, to make any gains.