Rewe and Penny have officially announced the termination of their partnership with the popular Payback loyalty program, embarking on the launch of their own customer rewards systems starting from December 29, 2024. This decision signals significant changes for consumers across Germany, as these major supermarket players reconsider how they engage and reward their loyal shoppers.
The new system, dubbed 'Rewe Bonus', replaces the previous Payback points with Euro credits, marking a shift not only for Rewe’s own customers but for the market as well. This revamped program is entirely digital and managed through the Rewe app, eliminating the physical loyalty cards traditionally associated with programs like Payback. Instead, customers will have opportunities to earn up to ten percent bonus credit on their next purchases, depending on their spending habits within the month.
Rewe’s decision reflects broader trends among retailers who are eager to control their customer engagement strategies and the valuable data associated with them. By utilizing their proprietary systems, Rewe and Penny will bypass the Payback infrastructure, potentially allowing them to offer more personalized promotions.
Meanwhile, the transition isn't without its complications. Customers who have spent months or years collecting Payback points at Rewe and Penny will find those points remain valid for redemption at other participating Payback partners for three full years following the change. This means customers needn't worry about losing their accumulated rewards immediately upon the program's switch.
On another front, Aldi Nord is also working to introduce its own loyalty program aimed to launch mid-2025. This new system is expected to function similarly to Payback, giving shoppers the chance to collect and redeem points for rewards, illustrating how retailers across the board are adapting to changing consumer sentiments about loyalty programs.
Edeka and its discount subsidiary, Netto, will step up to take Rewe’s place as leading partners with the Payback program starting January 1, 2025. They aim to capitalize on the customer base generated through Payback, which boasts around 31 million users. With their recent partnership, Edeka and Netto will not only retain existing customers but also attract those who are newly abandoned by Rewe’s exit.
Against this backdrop, the Deutschland Card is preparing for its reinvention as well. The card, which has lost significant market power with the exits of Rewe, Edeka, and Netto as key partners, will introduce innovations intended to create new points-earning opportunities. Beginning on January 2, 2025, users of the Deutschland Card will have access to the new 'points scanner' feature, which enables them to scan receipts from participating retailers to accumulate points irrespective of traditional partnerships.
The chaos around loyalty rewards and cashback offers has sparked discussions among consumer watchdogs. The Verbraucherzentrale has urged shoppers to carefully manage their personal data, emphasizing the trade-offs customers face between data sharing and potential savings. Research has shown the average savings from these programs are minimal, with Payback reported to yield just 0.11 percent savings and the Deutschland Card even less at 0.05 percent.
While they seek to attract loyal customers, retailers like Rewe and Aldi must also navigate the dissatisfaction stemming from reveals about the ineffectiveness of such programs. The merits of these offerings seem questionable when considering the highly touted savings versus reality, especially when loyalty programs often bind consumers to specific retailers at the expense of comparison shopping.
With Rewe now solely focused on its own initiatives, analysts will be watching closely to see if independent loyalty programs improve actual savings for consumers or if they will merely become one more instrument through which customer data is harvested, all under the guise of loyalty.
Overall, the transformation of loyalty programs marks just one of many shifts approaching the retail sector as we move forward. While the changes open up new avenues for customer engagement, they also pose fundamental questions about how well they will actually serve consumers considering the deceptive allure of savings and rewards.