M&S moves to shore up customer loyalty

In a radical break with tradition, Marks & Spencer is planning to launch a branded credit card and loyalty scheme to keep shoppers coming back to its stores.

The beleaguered high street chain has never run a customer loyalty scheme, such as Tesco's Club Card, or offered its own credit card.

It only began accepting credit cards in April 2000, being the last high street store to do so.

A wholesale review of M&S's financial services began in March.

Laurel Powers-Freeling, the 44-year-old American who joined M&S from Lloyds TSB last month to run the financial services division, is finalising the plans.

Advertising agencies are being briefed about a multi-million-pound marketing push.

The loyalty scheme and card will be pitched, in the first instance, at the 5m holders of the M&S store card.

Trials of the services will start next year.

"We are currently reviewing our charge card with a view to reinvigorating it. But we are looking at all aspects of financial services," said an M&S spokeswoman.

M&S already offers insurance, life assurance, stakeholder pensions, personal loans, mortgage protection, car-buying plans, savings and investment advice through its financial services divison, which makes a profit of almost ?100m a year.

The UK retail managing director, Roger Holmes, has said financial services represented a huge opportunity for the company.

He said the boom in consumer spending on home ownership, personal possessions and travel had left people under-funded in areas like pensions and healthcare.