Personal Finance

Perks of being loyal

Bhavana Acharya | Updated on March 19, 2011 Published on March 19, 2011


Ever been confronted at the check-out counter of an apparel store with a pitched effort to make you sign on to that store's membership program? Apparel chains are hardly alone in their efforts to keep customers coming in, with grocery stores, book stores and even oil companies offering membership programs to reward customer loyalty.

If you think you've got a great deal and sign on, you may want to reconsider it . Membership programs work only if you are an avid, frequent and brand-loyal shopper. Here's how .

The basics

Akin to credit cards, store chains have an array of cards ranging from basic privileges to premium cards which offer additional benefits. One way to get a card is to pay money and buy it . For instance, you can get Landmark's Classic Card for Rs 150.

The other way is to make a minimum one-time purchase of a specified sum (this sum varies across chains ) and you get the card for free. Westside's ClubWest, for example, calls for a one-time purchase of at least Rs 2,000 for a basic card.

If you have a basic card, it will be upgraded based on your spending . For instance, Pantaloon Green Card holders are upgraded to a 3-star Green Card on an accumulated spend of Rs 8,000 within 12 months.

Now how exactly do you benefit from a membership card? These cards take after the reward points programs of credit cards. Quite simply, you earn points based on the amount of money spent. For instance, in a Shoppers' Stop First Citizens Classic Moments card, you earn one point for every Rs 100 spent. On the other hand, every Rs 25 spent on the Titan Signet card earns you one point. One point is usually worth one rupee.


How beneficial are these reward programs? Remember that store chains want you to stick to their stores. To that end, most chains require a minimum number of points to be accumulated before they can be redeemed for discounts or gifts.

You would therefore have to rack up quite a bit if you are to obtain discounts or gifts of substance. Consider this. Westside needs a minimum of 200 points before they can be redeemed, translating into a minimum spend of Rs 20,000 for a discount of Rs 200. Landmark's Classic Card is a shade better, requiring a minimum of 100 points or at least Rs 10,000 in spending. Most cards also come with expiry dates.

Even if you do love to shop, you would have to stick to the same chain for a long period of time in order to build your points, restricting the choice of shops. It is only in some cases, such as with Reliance One cards from Reliance Fresh and Indian Oil XtraRewards Cards, where the need for repeated visits may not be much of an annoyance. The nature of purchases here are basic necessities and are fairly regular in occurrence allowing steady accumulation of points .

Some chains also do not allow accumulation of points during sales periods or other promotion schemes that they may come out with. Cards are also not transferable; if you want ride on your friends' purchases to accumulate points, your presence is required to sign the bill.

A redeeming factor of sorts is that some memberships such as First Citizens and Club West have tie-ups for discounts with restaurants and salon chains. You may also be better off in some cases where the points system is pushed aside for flat discounts on specific days, such as in Pantaloons.


Multiple memberships beget another problem – you must carry all those cards every time you shop. Enter i-mint cards. These cards have tie-ups with a host of retailers such as Gitanjali Gems, Mega Mart, UniverCell and so on. Spends at these retailers earn points which can be redeemed into gifts with i-mint. Note that here too, the quantum of points required is rather high. A Prestige gift voucher, for instance, worth Rs 502 requires 2010 points.

Published on March 19, 2011

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