The Canadian loyalty landscape has undergone significant changes. HSBC Rewards were recently converted into RBC’s Avion Rewards, Canadian Tire partnered with Petro-Canada and Metro announced they would terminate their partnership with Air Miles to focus on their own loyalty program, MOI.
Financial institutions, merchants and loyalty programs claim these shifts offer more value for consumers, but it’s likely about higher profits. The changes might be confusing, but consumers can benefit from the loyalty arms race with a little research and strategic thinking.
There is no more loyalty
Every retailer wants to participate in a loyalty program to gain a competitive advantage. For some merchants, that means jumping to a different program. Others believe bringing things in-house is more beneficial. What retailers really want is your data, but consumers who pay attention to loyalty program changes can find ways to save money.
For example, Metro’s MRU-T departure from Air Miles is significant because the chain was the loyalty program’s only major grocery partner. This had potential to be a death blow, but Air Miles responded by announcing Air Miles credit card holders would now earn two times the points at all grocery stores and wholesale clubs such as Costco in Canada.
Not having a specific grocery partner is less relevant now because members can earn extra miles at any grocery store. Plus, Air Miles collectors can now earn more points on specific products, such as bacon, juice and chocolate through receipt scanning offers in the app. This new tactic gives packaged goods companies more consumer data and gets them into the loyalty game.
If loyalty partners aren’t even loyal to each other, consumers shouldn’t be, either. You should take advantage of any offers provided and pay with a credit card that gives you the best return. This could lead to significantly more rewards earned.
Think of your goals
Loyalty programs often advertise the different ways to earn rewards. But that’s only half of the equation. How you redeem your rewards is just as important and should be a significant factor in determining your loyalty.
Let’s say you fly WestJet twice yearly to work and visit family. Getting the WestJet World Elite Mastercard would be beneficial, since you get your first checked bag for free and an annual companion voucher. However, using the card for your daily purchases might not be the best idea, depending on your rewards goals.
Say you ultimately want to take a business-class flight to Asia or Europe. WestJet’s loyalty program is a cash-based one where you earn WestJet dollars. These rewards can only be used to offset the base fare of a WestJet flight. Plus, the airline has limited reach, so they might not fly to your preferred destination.
On the other hand, with Aeroplan, you can book any available seat on Air Canada AC-T, including the mainline, Rouge, and Jazz airlines. If the seat is available for sale, you can book it with points. You can even pay any fees or taxes with your points. So, you might be better off using an Aeroplan credit card to get the bigger payoff later.
Some people aren’t focused just on getting the maximum value. Instead, they’re looking for a great end-to-end credit card and loyalty experience. In this case, American Express cards that earn you Membership Rewards may be appealing. Not only can your points be redeemed as a statement credit for any travel purchase, but you can also access Amex’s The Hotel and Global Dining Collections. These membership perks can give you free room upgrades, dining credit and special access to some of the top restaurants worldwide.
Unless you’re a frequent traveller with a real chance to reach higher status tiers, there’s no real reason to be loyal to one specific brand. You should be looking for what offers value that’s meaningful to you.
Stick to what works for you
The gamification of loyalty points can be overwhelming. If you prefer to keep things simple, stick to two or three loyalty programs and learn them inside out. You can make strategic decisions with your points if you know what’s available.
Taking advantage of the best promotions can help you rack up points. For example, Shoppers Drug Mart offers 20 times the points a few times a year, and the Aeroplan eStore runs a Black Friday event. There’s also the Triangle Max Stack Event on this week where you can earn up to 50 times more Canadian Tire CTC-T money.
Most loyalty programs have targeted offers within their apps and you’ll earn extra points if you load them before shopping. Deals are based on your previous spending habits, so it’s always beneficial to look. When it comes time to pay, use your credit card that gives you the highest return so you’re earning points on every purchase.
Barry Choi is a personal finance and travel expert at moneywehave.com. He was previously affiliated with RBC, Canadian Tire, AIR MILES, WestJet, Aeroplan, American Express, and PC Optimum, but currently has no relationship with any of the brands.
Barry Choi