Australia’s grocery giant Woolworths has junked its association with Qantas Airways on its Everyday Rewards card program, which offered frequent flyer points to shoppers. Woolworths, which is battling fierce competition from rivals Coles and Aldi, is trying to win back its lost market share through the new strategy.

Under the new scheme, Woolworths will offer shoppers discounts on groceries rather than Qantas frequent flyer points. The terms of the new look scheme allows customers to earn “dollars” when they shop for grocery items, The Sydney Morning Herald reports.

Rewarding loyal customers

Woolworths was convinced that only 9 per cent of customers were chasing frequent flyer points as opposed to 68 per cent of its shoppers, who wanted more discounts on groceries.

Under the newly announced scheme, as soon as a customer earns $10, that amount will be saved on the reward card and can be redeemed when they next shop.

The supermarket’s boss, Brad Banducci, said it was quite easy to accrue $10 in savings. Woolworths hopes the simple scheme will help its 9 million loyalty customers earn the much sought after discounts on groceries. Banducci also mentioned that the changes were part of its customer first strategy.

“There was an absolute commitment to look at the business through the eyes of our customers and make decisions that benefited them,” he added.

Rationale of review

The retailer has long found the programs with Qantas-Big W or BWS costly, and had felt burdened by the responsibility of paying for the points earned by customers, an earlier report from The Sydney Morning Herald said. The rewards program has been offering shoppers at Woolworths and liquor outlet BWS a frequent flyer point for every dollar spent over $30 in a single transaction.

At Big W, which is a chain of discount stores targeted at Woolsworth consumers, customers could earn one frequent flyer point for every two dollars spent over $30 in a single transaction.

A spokeswoman of Woolworths said the supermarket had already indicated to Qantas of the need to “make changes” to the Everyday Rewards program “to benefit our loyal customers.”

Woolworths' changes have come despite a Qantas spokesman saying confidently last week that the program and partnership would continue unhindered, and that both companies are in discussion over how to ensure the loyalty program “continues to meet the needs of our Frequent Flyers”.

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