Wellcome offers new credit card

Dairy Farm International Holdings Ltd's Taiwanese supermarket unit Wellcome yesterday launched a credit card together with the Shanghai Commercial & Savings Bank (上海商銀) in a move to lure more customers to shop in its stores.

Wellcome Supermarket (頂好超市), Taiwan's largest supermarket chain with 151 stores, said the "Wellcome Key Card" will offer cardholders a 0.5-percent to 1-percent cash rebate for every one penny they spend, a company executive said yesterday at the launch.

The Shanghai Commercial & Savings Bank will start issuing the co-brand credit card in December, and Wellcome expects to attract 100,000 applicants during the next three months.

"We estimate that around 30 to 40 percent of the co-brand card applicants are the source of our new customers," said Wellcome's chief executive officer Alex Tay (鄭朝豐).

Wellcome estimated it seized around 20 percent of the NT$77 billion-worth supermarket busioness in Taiwan last year. The chain's chief operations officer, Howard Tsai, (蔡裕人) said there is still space to expand their business in Taiwan.

Tsai last week told a Chinese-language newspaper that the retailer wants to open four more stores by the end of the year, with annual sales of NT$15 billion. He said Wellcome is planning to have 200 outlets by 2005 with annual sales of NT$20 billion.

"It is a loyalty co-brand card," said Tsai. "We hope to establish a mechanism to attract loyal customers by understanding their shopping patterns and rewarding loyal customers with benefits through this card."

Wellcome's largest rival, Sung-ching Supermarket (松青超市), which started offering membership services two years ago, said they have no plan to follow suit in issuing a credit card.

"Customers can pay NT$100 to obtain membership. Members are able to accrue points every time they shop in our supermarket and enjoy discounts or rebates by using those accrued points," said Liu You-chin (劉友清), Sungchin's associate manager for marketing and planning.

Sungchin currently operates over 80 stores in Taiwan, accounting for around 8 percent of the nation's supermarket business. The chain claimed it has spent hundreds of millions of dollars in maintaining its membership database every year.

"Besides discounts and rebates, we regularly hold seminars on health issues, cooking classes, and even one-day tours to the places of origin of our vegetables and fruits, exclusively for our members ... This approach helps us keep strong relations with our loyal customers," Liu said.

"What matters to customers is the quality products that supermarkets offer, instead of the cash rebates provided by the co-brand card," Liu added.