Zapper has made “almost all” staff redundant because “the UK has not adopted the model quick enough”, according to a former Zapper employee.
Retail Express understands that out of the loyalty app scheme's approximately 50 UK employees, 40 of them were made redundant. The move means the previously announced rollout plans with Gillett's Spar and Nisa Evolution are on hold, and retailers will no longer receive store visits from reps.
A source within Zapper told Retail Express that due to pressure from investors, the company is changing to "a top down approach", and rather than trying to sign up retailers, it will try to strike deals directly with EPoS providers.
The source told Retail Express that out of the 800-900 stores signed up to Zapper, it failed to retain up to 20% of these as there are no exit fees in the contracts. Strict sales targets meant Zapper's sales team often oversold the system's benefits.
Another former Zapper employee said: "What we have learnt is that the sector is still not ready, no matter how hard we pull for such a transformation. It is clear due to slow market and consumer adoption that Zapper is perhaps two or three years ahead of what the market requires today."
However, retailers using the scheme disagreed. Ferhan Ashiq from Levenhall Village Store in Musselburgh, East Lothian, said: "The technology was good. I did really well from it. If Zapper is cancelled in the UK, I will not be happy."
Another retailer told Retail Express: “In the past couple of weeks the cracks have been appearing at Zapper. They may have been adding stores but they just aren’t getting the pay back. Now all the sales team has gone.”
A source still working at Zapper told Retail Express that all store issues would now be handled over phone or email.
Zapper is a smartphone based loyalty scheme that uses an app to give shoppers special offers in participating shops. The company is operational in overseas markets and launched in the UK in 2016, partnering first with P&H and later with Spar, the NFRN, ACS and Bestway.
Responding to Retail Express, Zapper CEO Gerry Hooper said the company needed "a more sustainable sales model", and promised to provide existing Zapper retail partners with "the utmost support as we move forward".
The move represents the second major convenience partner shakeup this week following Kerryfresh's bankruptcy on 26 March. Read about Kerryfresh here.