Canadians find value in loyalty programs
Whether we’re grocery shopping or buying gas, coffee, a light bulb or cosmetics, cashiers ask if we have a loyalty card or offer to sign us up to a loyalty program.
Canadians are joining loyalty programs in droves. Year after year, statistics show our love affair with collecting and redeeming loyalty rewards continues to grow. According to the findings of the Colloquy Loyalty Census in 2011, there were almost 121 million active loyalty program members in the country across different programs, up six per cent from the census taken two years earlier.
Carlos Dunlap, editorial director of Colloquy, a LoyaltyOne research group, anticipates the 2013 census “will likely show a further six per cent rise in active memberships, based in part on the ongoing commitment of companies, particularly in the retail sector, to make their loyalty programs more relevant and appealing to consumers.”
“Loyalty cards are a mainstay in people’s wallets,” says Patrick Sojka, founder of Rewards Canada, an online resource for Canadians to find information and bonus offers related to travel rewards. Whether they are using plastic cards belonging to a national program or a punch card at their local gelato store, “people are discerning,” he says. “They want to know they are getting value for the effort they put into participating in a program.”
Clients look for value, notes Stephen Menon, associate vice- president, North American credit cards and merchant services, TD Canada Trust, “but also for simplicity and flexibility that rewards their efforts.” The new TD Cash Back MasterCard, for instance, “allows consumers to earn 0.75 per cent on every purchase and redeem, with a $ 25 minimum, whenever they choose,” he says.
As the loyalty market has matured and grown, so too have the ways to earn rewards and the kinds of rewards that can be redeemed.
At Aeroplan, for instance, more than 90 per cent of members collect miles for travel, says David Klein, vice- president, marketing and innovation. But to further serve its customers, Aeroplan launched a digital media store in 2012 where members can turn miles into media downloads, a loyalty industry first in Canada.
In February, the Air Miles for Social Change program added to its list of ways to earn rewards by partnering with the federal government and 15 YMCAs across Canada. The partnership enables families to earn Air Miles reward miles in ways that encourage physical activity, such as registering their children for day camps, using participating fitness facilities or buying YMCA memberships.
Identifying other recent trends in loyalty programs, Klein cites initiatives that engage Aeroplan members through social media and gamification. These initiatives “inject an element of fun into earning the miles,” he says.
In its 2013 incarnation, the Star Challenge program introduced last year allows members to earn miles by shopping and utilizing services of Aeroplan partners through engagement on Aeroplan’s Facebook page and Twitter feed.
Loyalty program members are also becoming more creative in how they use their frequent flyer rewards, says Sojka.
While some collectors hold onto their rewards with a specific destination such as Paris in mind, he says, there are others who use their rewards to make their vacations more luxurious — perhaps by staying at a five- star hotel.