Blackfriar: Loyalty cards should be on Morrisons and Asda's agenda

Tesco's like-for-like sales rose by 4.9 per cent, exceeding market expectations of three per cent growth, and Sainsbury's produced a credible 4.2 per cent increase.

Now all eyes will be on their Yorkshire rivals, Asda and Morrisons.

Bradford-based Morrisons is expected to emerge the festive winner with like-for-like sales up by as much as seven per cent.

Leeds-based Asda, owned by US retail giant Wal-Mart, is also expected to show a strong sales increase of around five to six per cent. While Asda and Morrisons are expected once again to outperform, the question is how much longer can this last? Both Tesco and Sainsbury's attribute much of their festive sales increases to their loyalty cards.

Tesco decided to send out its Clubcard coupons early and double the points in the run-up to Christmas.

This achieved three things – Clubcard owners did their Christmas shopping at Tesco, they spent more in Tesco than in previous months and they treated themselves – as shown by a 16 per cent increase in sales of Tesco's Finest range.

Tesco handed out around 100m in extra loyalty vouchers before Christmas and the group said around 40m of these were redeemed.

The additional vouchers boosted like-for-like sales by about 0.5 percentage points.

Recent research by Asda shows that supermarkets are one of the most trusted organisations to help people get through the recession.

Following friends and family, police are the next most trusted, then supermarkets followed by teachers, social workers and at the bottom of the pile, politicians.

So at a time when customers are rewarding supermarkets for being trustworthy by staying loyal and using their loyalty cards, isn't it about time Asda and Morrisons got their act together and launched their own loyalty card? During a recession both have done well as people opted for BOGOFS – buy one get one free deals – but in the coming era, loyalty and trust are going to have a much greater resonance.

When the new chief executive takes over at Morrisons, Blackfriar wouldn't be at all surprised if a loyalty card wasn't one of the first things on their agenda.

Blackfriar notes with interest the appointment of Lawrie Haynes as non-executive director to the board of Network Rail.

That's the same Mr Haynes who stepped down as chief executive of Leeds-based consultancy White Young Green this time last year to join Rolls-Royce. "His general business experience and, in particular, his mission-critical project and safety management expertise will be a valuable addition to the board," gushed the taxpayer-backed owner of Britain's rail infrastructure.

Mr Haynes, who joined WYG in 2007, left two months after the group released a profits warning. His departure was by "mutual consent" and did not include a payoff.

Under his leadership the consultant had continued its ambitious acquisition policy, which meant it entered the recession with a hefty debt burden.

That debt was very nearly WYG's downfall, and it has only just emerged from a painful period which saw hundreds of job cuts and a debt-for-equity swap that left its banks with 60.5 per cent of its equity and shareholders with just 15 per cent.

At the time his departure from WYG was called "sensible" by analysts at Arbuthnot who said he was "brought on for a role of expansion in market conditions which have changed markedly".

Network Rail described Mr Haynes as a "successful chairman and chief executive with a heavyweight CV".

Maybe so, but Blackfriar bets there are a few shareholders and staff who would disagree with the success of the WYG chapter.