The two largest loyalty schemes in the UK are Nectar and Tesco Clubcard. Nectar claims to be the most popular out of the two and has more partners with which to collect, both Tesco Clubcard and Nectar have an impressive array of partners with which to spend. You can also increase your points balance with using credit cards from Sainsbury's or Amex for Nectar and Tesco Bank with Clubcard.
In store a Clubcard point is worth 1p and a Nectar point is worth a halfpence. This is why originally Sainsbury's and most Nectar partners gave 2 points per pound, this meant at base value you earned the same both on Nectar and Clubcard. Now that Sainsbury's is halving their earning rate it means you'll earn half as much as you would earn with Clubcard if you redeem your points to spend in store.
If over the year you spend £10000 in Sainsbury's with the new base earning you'd get 10000 Nectar points which are worth £50. If you spend the same amount in Tesco you will get 10000 Clubcard points which are worth £100.
Sainsbury's have promised an increase in bonus points to make up for the reduced earning. However, this means to gain the extra points you're going to have to meet the conditions of the promotion that may mean buying particular items or meeting a minimum spend. As well as offering a better base earning rate Tesco also offer frequent bonuses so although it can't be certain it's unlikely that you'd earn more points (in value terms) in Sainsbury's than in Tesco.
Remember that 1 Nectar point is 0.5p and 1 Clubcard point is 1p.
Nectar American Express
This currently gives you 2 Nectar points (1p) per pound spent on the card. The only drawback is the card is only accepted where American Express is, which is at fewer locations than Visa or Mastercard.
Sainsbury's Bank Mastercard
This currently gives you 2 Nectar points (1p) per pound spent in Sainsbury's only, and 1 point (0.5p) per £5 spent elsewhere. This is not as good as the American Express but may be worth having for use in places that don't accept American Express.
Tesco Credit Card
This currently gives you 1 Clubcard point (1p) per £4 spent.
The Nectar American Express card is the best earning card of the ones available but is limited to places that accept American Express (whether this is an issue depends on where you live and where you use your card). Out of the Mastercards the Tesco one is generous by more than double.
Other Earning Opportunities
Nectar wins on the number of places you can collect, some options are good if you shop there others are poor.
Nectar top partners
- Homebase 2 points per pound spent
- BP 1 point per litre of fuel and 2 points per pound spent in the shop
- First Group - 2 points per pound for all UK rail travel
- The rail travel offers on Virgin are limited to their own services so it's better to book through First Group
- Sainsbury's Mobile - 4 points per pound when topping up
- Hertz - 2 points per pound spent
- eBay - 1 point per pound spent
Nectar poor partners
- Nectar Toolbar by Yahoo! - offers 100 bonus points (50p) for installing and 1 point per 2 searches (1p per 4 searches). Installs a bar which takes up space and monitors your search history, to earn points you need to search with Yahoo! This is only going to earn you pennies a day, takes up space and monitors your searches. Recommendation: avoid.
- British Gas - offers 200 points (£1) a year for each service (gas and electricity) you have with British Gas and also points for other activities such as 120 points (60p) for submitting a meter reading. Recommendation: only worthwhile if British Gas is cheapest for your circumstances. Otherwise look at alternative suppliers.
- Nectar canvass - up to 120 points (60p) per survey. Doesn't seem worth the hassle.
Although the list of earning partners is impressive only a few of them have a reasonable offer. It may be worth collecting if you use these partners regularly and Sainsbury's is your supermarket of choice. Remember though that with half the earning rate of Clubcard you'd have to spend a lot with Nectar partners to make up the difference.
If the sole reason for choosing your supermarket is loyalty points then you're certainly better of at Tesco, however you should look at other aspects when considering which supermarket to use. If price is your main concern you're more likely to save money at the cheapest supermarket compared to the points you earn. Other considerations are quality and location.
Is it time to ditch the Nectar card? Only you can decide. If you no longer find the scheme rewarding then cancelling your card (use up your points first) is a good way to send a message.