September 22, 2010

It's a Rip Off: Watsons VIP Card

Ladies, don't get the Watsons VIP Card. It's an absolute rip off and a ridiculous waste of RM 12 which you are never going to get back in a year.

Let me lay out the facts for you.

The Watsons so-called VIP Card is like any other customer card we get from Isetan, Robinson's and the like. The idea is simple: the more you spend, the more points you earn and the higher the rebate.

Customers are expected to pay RM 12 for the Watson's VIP card. Card holders earn 1 point for every RM 1 spent in-store at Watson's and once they have collected 200 points, they are entitled to a RM 1 rebate. Customers earn double points for every Watson's in-house product purchase and 5 times the points earned for the first purchase made during your birthday month. Special discounts and bonus points are given for particular products as well.

Putting the special offers and bonus points aside, let's take a look at the basic tier.

Every RM 1 spent gives you 1 point.
200 points collected gives you RM 1 to spend.

This means that you need to spend RM 200 in-store to get an RM 1 rebate. For those with a finance bent, this gives us a rate of return of 0.5%.

Some of you out there may be thinking, "Hmm, ok. Let's say I spend about RM 50 in-store a month. This gives me a return of RM 1 after 4 months but I guess that it's better than nothing..."

Aha, but you have forgotten something. You need to pay RM 12 for the card. This means that you have to spend a grand total of RM 2,400 before you see any real returns on your Watsons VIP card.

Think about it long and hard, ladies. How long will it take you to accumulate a total spending of RM 2,400 at Watsons? Some of you may not have a problem but the average consumer is going to take more than 2 years to hit that much, lifetime membership or not. One of my friends argues that the RM 12 will be offset by all the free vouchers included with the card and that I was seeing too much into the issue.

"Look, maybe they are willing to pay RM 12 for all those vouchers. The card isn't the point."

The thing for me though is that the card is the whole point. Even if I do get my money back in the form of vouchers, I still expect to derive a certain value from a membership card. Most departmental store cards have a 5% rebate on purchases. The OneCard has a 1% rebate but lots of participating outlets. Strip the bells and whistles away and the Watsons card only has a 0.5% rate of return.

Have you seen the number of customers in a Watsons outlet on a ordinary day? Their turnover is amazing. There has to be a better way of rewarding your customers.

Even after looking at the bonus offers and special member prices offered with this card, I was still left shaking my head. The savings are minimal and while the special bonus points seem like a lot, they are actually not worth much once you do the math. 10% in-store discounts are more value for money.

To put it another way, are you telling me that I can spend RM200 in store for my birthday month, get 1,000 points and only get back RM5 for my efforts? I might as well wait til Christmas when RM5 vouchers are given with every RM25 purchase at Guardian.

I doubt that RM 5 will make much of a difference after dropping RM200 at the counter. People for whom that RM 5 would make all the difference for wouldn't be caught spending RM200 on toiletries in one shot. I work with the rural poor, for crying out loud, so I know the value of RM 5 to them. From this angle, not only is the Watsons card low value but elitist to boot.

Even Malaysian banks have a better rate of return -- and that isn't saying much!

Over the Border to Singapore

If we look closer across the border to Singapore, their Watson's card costs $5 for lifetime membership. Every $5 spent gives you a point and every $ 50 spent gets you an additional 10 points. 20 points gets you a rebate of $ 1. This gets you a basic return of 1%. If you spend $ 50 each time you step into a Singaporean Watsons, you end up with a return of 2%.

Also, you need to spend $500 ($ 250 if you opt for the $ 50 nett spending option) to get back that initial $ 5 spent on getting the card. If we ignore the exchange rate and consider that the Singaporean dollar has a higher purchasing power in Singapore, the Singaporean Watsons card is a much better deal.

Other Loyalty Cards

The famed UK Boots card gives a 4% rebate for every pound spent. The Priceline card in Australia gives quarterly rebates: 3% for every AUD 100 spent quarterly and 4% if you spend above AUD 200 in-store (assuming that you don't purchase anything with bonus points). Both cards, by the way, are free.

Conclusion

I love Watsons and think that they carry a really good range of skincare and cosmetics. I also like the fact that they are making the effort to bring a wider range of brands. Who would have thought of seeing DHC on Malaysian shores a few years ago? I make beeline for Watsons each time I enter Midvalley.

I do object to what seems to be pretty shabby treatment of a loyal customer base.

My advice?

Don't buy the card and complain about it to Watsons customer care services. This customer loyalty card is an absolute rip off, has little value and I think that the Watsons customer base deserves better. Watsons can and should definitely do better than this.

Competing pharmacies, take note.

34 comments:

florence said...

Very detail :) Thanks so much.

Tine said...

Good one, Eli. I highly agree with your breakdown of costs. I don't mind taking a store's loyalty card as long as it's free, or if the returns justify having to pay a certain fee.

It's such marketing B.S to state "LIFETIME MEMBERSHIP". They almost always fail to mention that lifetime means the lifetime of the company, not the customer's life :P

Personally, the only loyalty card in Malaysia that I completely support is Popular Bookstore's. 10% off purchases gives massive returns on the measly RM10 (I think it's still RM10) you pay a year.

Watsons, shame on you for cheating your customers out of RM12.

aisyah De Cullen said...

Thanks! I was about to get this since I shop at Watsons a lot. But this post made me see sense..!

akiki said...

u absolutely right about the return rate!!!
i was about to apply but once saw the return rate, i dared not to make decision immediately..

Connie De Alwis said...

Excellent observation and evaluation! I must admit that I got intrigued by the card when I saw it on TV but I'm not really a membership card person to begin with. In the end I don't shop that much to benefit from a card.

Steph said...

I saw this on tv and wanted to get it. I do spend a lot at Watson's and Guardian, so I was thinking spending RM200 to get back RM1 rebate will be better than nothing. But now that I find out you have to pay to get the card, it's a total rip off! Spending RM2400 just to offset the RM12??? I may spend a lot, but not THAT much!

weinice said...

thank you for ur advice. Luckily u tell me this the rate of return just 5% only compare to others...and it doesn't haveany 10 % for every purchaswe..not wrth to apply it..i will share to my frens..

can i ask what is ur career?ur r financial analyst?

Eli said...

Thanks for the all comments. I am glad to see that everyone agrees with me so far!

Tine: Ooh, yes, I love the Popular card. It was the saviour for all school students when I was in high school. Hardly frequent Popular now though so I gave up my card.

The Metrojaya card isn't too bad as they give bonus rebates during festive seasons which can add up to 10%. Mum's friend did the math and only does her skincare shopping during promotions.

Maybe I should write about that.

Weinice: Ah, no. I am a researcher with a development institute. One of my degrees was in finance though so the training is still there.

Anonymous said...

Great post!!! I might even call it brilliant :)
ahh but alas, I just got myself the card a couple of days ago :(
oh well

Askmewhats said...

Gosh, you and I have the same thinking, before purchasing any membership card, I always calculate on the costs and if its worth it! It's worth the purchase if you are a Watson's frequent shopper and you don't have problems spending a lot in that particular store..but to force yourself to spend more just to get those returns? NOT worth it

Wonderfully written post

Anonymous said...

wow! wonderfully written.

was approached by watson's sales staff last fri. when i heard about 200 points collected for RM1 rebate, i say not worth it at all. credit cards will give a better deal (if im not wrong, its about 50points for RM1 rebate) and i know i wont spend RM2400in watson's.

shuaddict said...

Wonderful analysis. So detailed! I was quite excited about this as I frequent Watson's a lot but never even thought of it like that. Thanks.

paris.beaverbanks@gmail.com said...

Yay Eli! When I first saw this online my thought was "What? I gotta pay RM12 and then I have to spend to get 200 points before I even get 1 measly RM?!" The idea of 200 points getting me only RM1 is laughable. They'd better buck up and consumers should smarten up too.

Eli said...

Anonymous 1: Oh dear, I was hoping that not too many people had bought the card. I was on the brink of buying it but was in a hurry and decided not to.

Do you mind telling me what vouchers were included in the card?

Nikki: I usually don't take loyalty cards unless I know that I will shop at the place frequently or splash out huge amounts if I shop at the place infrequently. Even so, my family has worked out a mini system of our own.

Anonymous 2: You are right. Some credit cards give great cash rebates. But I don't really have a use for credit cards now that I don't have any uni fees to pay.

Shuaddict: I was excited too! am glad that I took a step back to examine the terms closely.

Paris: The marketing is so deceiving! I emailed the Watsons Marketing Development Manager to complain but so far no response. Hmm. If I don't get any response in 2 weeks, I might just boycott Watsons.

Kahani said...

Us So Loverly girls are pugnacious yo!

Farhana said...

Thx for ur post but
I got the card for free..
I was asking bout the watsons card yesterday and the receptionist just explain everything and she gave me one and all those vouchers. I look at my receipt and she didn't add RM12. She just asked me to activate this card at watson's website..That's all..

Anonymous said...

Wow! thats a great post! u are absolutely right about the card! I had apply a watson member card in taiwan when i went taiwan for travelling, i think it cost about the same but it lasted for a lifetime! moreover, I can get 5% discount (or more which i cant remember) with every purchase regardless of the amount i purchase! What a boo to watson malaysia!

Jessying said...

totally agree on this, therefore if not getting the card for free, wont apply also.

The so called RM200 vouchers, is RM2-3 deductions for more than 50 over products of their original price. Which normally they have discount of 10-30% in store.

RM2400 to get back my RM12. If with my Isetan card, probably I already got back my RM240 vouchers and with my Parksons Elite card 5% of RM2400 (even items on discounted item).

Watsons got to make the calculation, its nothing to shout about when the points system is worst than bonuslink!

WendyPua said...

wao! very detail explaination!
REALLY not worth to have it !

Celine Mook said...

I remembered the sales person told me that I am going to pay RM12 and I don't need to pay anymore no?

synical said...
This comment has been removed by the author.
synical said...

When I first read the details about the card, I thought I smelled a rat. Now I can put my finger on it - thanks for the post.

While I also didn't pay the RM12 for the Malaysian Watsons card, but I don't know if I will actually ever use it; if it wasn't a lifetime membership, I wouldn't bother. Although now that your post has mentioned it, I might consider getting the Singapore one the next time I'm there and if they'll let Malaysians residing in Malaysia go for it :P

My favourite loyalty card is still the ONECARD (which I also got for free) because I love tapping in and out of the parking lot and I can collect points from a lot of outlets too - like how if I want to get anything from Kiehls, I'll go to the 1U one instead of the other outlets just for the points. 1U is my "second home" for a reason :P

toughcookie said...

i think this is a brilliant post and a thorough analysis.

unfortunately, malaysian consumers are always treated like suckers and we'll condone to anything. i agree that elsewhere, customers are treated better because they demand to be treated better.

i've never really checked out the watson's card because i would usually shop at guardian. but this is a very useful info!

liping said...

Hi there, just wanted to point out that the cash vouchers can be used on top of any ongoing promos and certain items give u extra points (eg sunplay = extra 100 points) but other than that, yeah you still pay 12 bucks.

Kahani said...

liping: the cash vouchers are something besides the card. if the vouchers are the point why even have the card. And RM12 aside, the rebate rate is not only ridiculous, it's insulting. =(

Anonymous said...

hi i want to make a formal complaint on Watson as a member. could anybody inform me how should i do this. i had purchased many things in my birthday month when they claim they give a 5 times more points. they neither paied this nor any of the points they had mentioned on the items. Shameful!

Kahani said...

Anon: I'm afraid you'll have to take it up directly with Watsons with whom we are not affiliated. Have you tried their membership site?. If it doesn't work out, then that's just another reason why no one should sign up for their membership card.

Anonymous said...

many thanks. after sending several emails to several parts finally i have received an email who is getting my information. so i will see what will happen at last. i wish this would work. but on the whole i am dissatisfied with the procedure and for not being customer friendly.

Anonymous said...

After the customer service staff got my information, they did no action. so I need to complain to the head of this company before anything. plz help me if you have access to their email address. i still want to be optimistic and assume that it is a mistake done by the workers.

siti saleha said...

Huhuhu i just get the card before reading this blog...feel regret for spending my rm12 for the what so called vip watsons card

Jia Leng said...

I agree with you. Today I have applied watsons card. I found that this card only benefit their customer for certain promotion products like buy first product normal price,second is RM 1. Just now I make a call to watson customer service hotline, there are no people respond any calls. What kind of service is this? hotline should be 24 hours to solve customer problems. Watson act so unprofessional!! wasted Rm 12 to buy this kind of bad service!

Anonymous said...

hahaha... sbb ko x pandai.. cuba time promotion ko dapat barang 10x 5x ... sehari boleh dpt banyak poimt... kalau g hari2.. no need to think about RM200.. Go watson on promotion.. u get 10x, 5x, 2x...

dwarky said...

U r so true i regretted buying the watsons membership card. And plus i nevr got 5 times more points on the 1st shopping of my birthday month. Its ridiculous. I had to go again and check. Dont get the watsons cars its utter waste

Anonymous said...

OMG! i just renewed my card and got RM5000 gift vouchers! And I cant even use the vouchers because I need to activate my card first and they keeps on sending me error. Watson has wasted my time and money and my RM5000 GIFT VOUCHERS!!! Tried to call the fucking so called customer service, THE NUMBER IS NOT EVEN REGISTERED!! WTH???