Supermarket Discount Cards Targeted in New Bill
By: Administrative Account | Source: Radio Sales Today
January 16, 2004 9:39AM EST

Senator Ken Chlouber (R-Leadville, Colorado), has introduced a bill that would ban supermarket discount cards, claiming that stores use the cards to gather information about customers' buying habits and then sell that to other companies.

The bill, Senate Bill 04-081, introduced earlier this month, states that "in some instances, base prices of consumed goods have increased after the introduction of loyalty programs or discount cards, to create the appearance that the consumer with the discount card is receiving a discount," and that "personal identifying information of a consumer participating in a loyalty or discount program is gathered and sold to third parties without the consent of the consumer."

A retail industry lobbyist denied Chlouber's claims and told local reporters that the cards require minimal information in exchange for sale prices. "If you don't want to provide that information you don't have to," Colorado Retail Council president JoAnn Groff said. "This is a program that is mutually beneficial to the stores and to the customers, but mostly to the customers."

Groff, who represents King Soopers, Albertson's and Safeway, said Chlouber is unfairly targeting grocery stores when dozens of other retailers also offer such discounts, called preferred customer cards.

Supermarket cards are free, unlike some other cards, and usually require customers to provide names, addresses and telephone numbers, she said. She pointed to an application for a Safeway card that promises the information will not be sold to outside companies and explains that the card will be used to track customer buying habits. Customers may request that the store not send them coupons based on the information contained on the application.

Mary Lou Chapman, president of the Rocky Mountain Food Industry, which also represents Safeway and King Soopers, said the cards are just the latest way for stores to compete for business by drawing in loyal customers looking for weekly specials. She said it is fairer and more convenient than coupons, which require people to buy a newspaper. (Source: progressivegrocer.com, 1/14/04)

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