NEW MEDIA: SPOTLIGHT ON NECTAR - Nectar's crash reveals danger of creating too much demand.(Sainsbury customer loyalty scheme seen as too successful)(Brief Article)

Online registration fiasco is bad news for the founders of Nectar, Mark Sweney writes.

The high-flying launch campaign behind Nectar, the new customer loyalty reward scheme with pounds 50 million in backing from its founders Sainsbury's, BP, Debenhams and Barclaycard, has come down to earth with a technical crash.

All online registrations for the scheme, which were encouraged with the carrot of 100 bonus points, have been suspended because high levels of demand caused key parts of the website (www.nectar.com) to grind to a halt.

Richard Campbell, the marketing director at LMUK, which runs the Nectar operation, claims that the company did undertake extensive testing of its web capability.

'We did a lot of testing and due diligence and anticipated the number of online registrations from our experience with other LMUK operations in Canada, Holland, Spain and the Middle East,' he says.

Campbell adds that despite a year of planning, demand outstripped the company's most 'bullish' traffic forecast by a factor of four times. He blames the security and encryption checks required within the registration process as the culprits for the closure. He says it has been a regrettable but unavoidable incident that was out of Nectar's control.

However, Steve Adams, a senior consultant at Dragon Brand Consulting, which specialises in web usability, disagrees. Adams, who has undertaken studies of the websites of brands including Sainsbury's, Tesco.com, Heinz and Haagen-Dazs, puts it down to poor media planning.