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Retailer Loyalty Programs - Canada - August 2017

Memberships in loyalty programs are high with 91% of consumers claiming to belong to a program, with the greatest engagement seen in categories that meet staple needs. Shifting household structures and consumer shopping habits means that traditional points collection methods may lose relevance. Ultimately, loyalty programs are working to keep shoppers loyal.

This report looks at the following areas:

  • Loyalty program participation is softer amongst Millennial men
  • Traditional points collection methods more of a hurdle for 18-24-year-old women
  • Quebecers may be more apathetic towards loyalty programs

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Table of contents

  1. Overview

    • What you need to know
      • Definition
      • Executive Summary

        • The issues
          • Loyalty program participation is softer amongst Millennial men
            • Figure 1: Loyalty program participation – men, by age, June 2017
          • Traditional points collection methods more of a hurdle for 18-24-year-old women
            • Figure 2: Agreement with relevance-related frustrations, women 18-34 vs overall, June 2017
          • Quebecers may be more apathetic towards loyalty programs
            • Figure 3: Loyalty program participation, Quebec vs overall, June 2017
          • The opportunities
            • Flexibility in reward redemption appeals to women
              • Figure 4: Desire for rewards that can be redeemed across multiple retailers, by gender, June 2017
            • Young women – it’s high time to be rewarded for advocacy
              • Figure 5: Desire rewards based on social engagement, women 18-24 vs overall, June 2017
            • Younger consumers less fazed by membership fees
              • Figure 6: Agreement with ‘I’m not interested in paying a membership fee’, by age, June 2017
            • What it means
            • The Market – What You Need to Know

              • Consumers more attuned to value in tighter economic times
                • Who shops for the household is changing
                  • The retail landscape in Canada is polarizing
                  • Market Factors

                    • Canadians are feeling the economic pinch
                      • Figure 7: Monthly movement in selected components of the Canadian Consumer Price Index, seasonally adjusted, May 2012-May 2017
                    • Shifts in household structures mean shifts in shopping responsibilities
                      • Figure 8: Grocery shopping responsibility, by gender, September 2016
                    • The retail landscape in Canada is becoming increasingly polarized
                    • Key Players – What You Need to Know

                      • Loyalty programs seeing success engaging women
                        • Effective program management platforms matter
                          • Some flux is seen in the marketplace
                            • New options on the horizon for young consumers
                            • What’s Working?

                              • Value propositions offered by loyalty programs are appealing to women
                                • Figure 9: Loyalty program participation, by gender, June 2017
                              • Online redemption capabilities drive more active participation
                                • Figure 10: TURF Analysis – desired loyalty program features, June 2017
                              • Spotlight on Shoppers Optimum
                                • Figure 11: Shoppers Optimum direct mail, June 2017
                              • Spotlight on PC Plus
                                • Figure 12: Your Personalized Store, November 2013
                            • What Are Some Areas of Concern?

                              • For loyalty program members, it is a time of flux
                                • Air Miles maybe not flying so high in the eyes of members
                                    • Figure 13: Retailer loyalty program engagement, June 2017
                                  • Air Miles faces an uphill battle with recruiting younger consumers
                                    • Figure 14: Air Miles program engagement, by age, June 2017
                                  • Uncertainty surrounds Aeroplan
                                    • Figure 15: Aeroplan engagement, by age, June 2017
                                • What’s Next?

                                  • Amazon Prime will likely see growth amongst Millennials
                                    • Figure 16: Amazon Prime engagement, by age, June 2017
                                  • Bonus! Apps to simplify and reward loyalty program usage
                                    • Figure 17: Attitudes towards apps and loyalty programs, 18-24s vs overall, June 2017
                                  • Spotlight on Drop
                                  • The Consumer – What You Need to Know

                                    • Most participate in loyalty programs, though there’s still room to grow
                                      • Perception of value is dynamic
                                        • Engagement is all about relevance
                                          • Loyalty programs really do build loyalty
                                          • Loyalty Program Participation

                                            • The market is highly saturated
                                              • Figure 18: Loyalty program participation, June 2017
                                            • 25-34-year-old men are a relatively untapped opportunity
                                              • Figure 19: Loyalty program participation – men, by age, June 2017
                                              • Figure 20: Repertoire analysis of loyalty program participation – men, by age, June 2017
                                            • Supermarkets are well positioned to market loyalty programs to men aged 25-34
                                              • Figure 21: Edge Cereal – Boxcar, August 2016
                                            • Opportunities to connect with less affluent via staple categories
                                              • Good potential to engage less affluent consumers with grocery retailers
                                                • Figure 22: Participation in supermarket loyalty programs, by income, June 2017
                                              • Quebecers are less engaged with loyalty programs
                                                • Figure 23: Loyalty program participation, Quebec vs overall, June 2017
                                              • Strong potential exists to recruit Quebecers to drug store loyalty programs
                                              • Redemption Preferences

                                                • It’s all about value
                                                  • Figure 24: Redemption preferences, June 2017
                                                • Discounts are top of mind for over-55s and the affluent
                                                    • Figure 25: Preference for discounts (% agree), over-55s and consumers with household income of $150,000+ vs overall, June 2017
                                                  • Opportunities to deepen engagement exist outside of discounts
                                                    • 18-24s are willing to wait for a bigger payout
                                                      • Figure 26: Save rewards for more expensive purchases when using dollars-off rewards (% agree), 18-24s vs overall, June 2017
                                                    • 18-24s will respond to programs that reward advocacy
                                                      • Women under 55 are more inclined towards instant gratification
                                                        • Figure 27: Agreement with ‘I usually redeem my rewards as soon as they’re available’, by gender, June 2017
                                                    • Desired Loyalty Program Features

                                                      • Meaningful rewards and ease of use are top of mind
                                                        • Figure 28: Desired loyalty program features, June 2017
                                                      • Women would like to see more partnerships
                                                          • Figure 29: Desire for rewards that can be redeemed across multiple retailers, by gender, June 2017
                                                        • Millennials want customized rewards
                                                          • Figure 30: Desire for personalized rewards based on interests, 18-34s vs over-35s, June 2017
                                                        • Meaningful perks will be remembered
                                                          • Young Millennial women are keen on rewards for social engagement
                                                            • Figure 31: Desire rewards based on social engagement, women 18-24 vs overall, June 2017
                                                          • Social and proud of it…a boon for loyalty programs
                                                            • Figure 32: Trevor, enjoy your reward! Acquisition email, June 2017
                                                          • Women aged 18-24 are looking for special treatment
                                                            • Figure 33: Desire for exclusive perks, women 18-24 vs overall, June 2017
                                                        • Frustrations with Loyalty Programs

                                                          • Fees and time it takes to earn rewards are top frustrations
                                                            • Figure 34: Frustrations with loyalty programs, June 2017
                                                          • Resistance against fees – in their words
                                                            • Younger consumers are less concerned about fees
                                                              • Figure 35: Agreement with ‘I’m not interested in paying a membership fee’, by age, June 2017
                                                              • Figure 36: Retailer loyalty program engagement, by age, June 2017
                                                            • Earning rewards more of a hurdle for women 18-24
                                                              • Figure 37: Agreement with relevance-related frustrations, women 18-34 vs overall, June 2017
                                                            • Give young Millennial women an alternative
                                                              • Quebecers are generally more apathetic towards loyalty programs
                                                                • Figure 38: Frustrations with loyalty programs (select), Quebec vs overall population, June 2017
                                                            • Impact on Shopping

                                                              • Loyalty programs are effective in driving their namesake
                                                                • Figure 39: Impact on shopping, June 2017
                                                              • Loyalty programs drive greater dedication amongst women
                                                                • Figure 40: Impact on shopping, by gender, June 2017
                                                              • Keeping them active will keep them dedicated
                                                                • Chinese Canadians lack dedication
                                                                  • Figure 41: Preference for shopping at retailers where they belong to loyalty programs, Chinese Canadians vs overall, June 2017
                                                                • Stroke the ego not the wallet
                                                                • Canadians vs Americans – Attitudes towards Retailer Loyalty Programs

                                                                  • Customization should yield greater gains for Canadian retailers
                                                                    • Canadians see more challenges to earning points
                                                                      • Figure 42: Frustrations with loyalty programs, Canada vs US, June 2017 (Canada)/February 2017 (US)
                                                                    • Canadians more likely to crave personalized rewards or redemption
                                                                      • Figure 43: Desired loyalty program features, Canada vs US, June 2017 (Canada)/February 2017 (US)
                                                                    • Catering to Canadian demands should yield greater traction
                                                                      • Figure 44: Impact on shopping, Canada vs US, June 2017 (Canada)/February 2017 (US)
                                                                  • Appendix – Data Sources and Abbreviations

                                                                    • Data sources
                                                                      • Consumer survey data
                                                                        • Consumer qualitative research
                                                                          • Abbreviations and terms
                                                                            • Abbreviations
                                                                            • Appendix – TURF Analysis

                                                                              • Methodology
                                                                                • Figure 45: Table – TURF Analysis – Desired loyalty program features, July 2017

                                                                            Companies Covered

                                                                            To learn more about the companies covered in this report please contact us.

                                                                            Retailer Loyalty Programs - Canada - August 2017

                                                                            US $3,995.00 (Excl.Tax)