According to BMO’s Annual Holiday Spending Outlook, more Canadians than ever plan to redeem loyalty rewards for gifts this year.
“Canadians consider loyalty rewards a bona fide gift-giving currency,” said Su McVey, Vice President, Customer Communications & Marketing, BMO Bank of Montreal. “More than 85 per cent of respondents to our poll told us they do not think using rewards for gifts is tacky; in fact, the intention to use rewards as an alternative to cash or credit to purchase holiday gifts increased by 6 per cent to 20 per cent this year from 14 per cent in 2010.”
While credit cards (64 per cent), debit (57 per cent), and cash (56 per cent) remain the three top payment preferences, the practice of redeeming loyalty rewards as a fourth option suggests Canadians are looking for ways to stretch their purchasing dollars. The good news for retailers is that this growing thriftiness doesn’t come at the expense of in-store and online purchases.
“Canadians, who plan to spend $1,397 on average this holiday season, are being both frugal and generous, as 26 per cent of those polled told us they will use the savings they generate from redeeming their rewards to buy additional gifts,” said Ms. McVey.
LoyaltyOne, which along with BMO founded the Air Miles program in 1992, reported that redemptions in all of the Air Miles rewards categories spike during the holiday shopping season, but electronics and toys typically experience the largest increases.
Redeem loyalty rewards early to avoid disappointment
Canadians who plan to redeem loyalty rewards for gifts this year should take note. To ensure your gift(s) appear under the tree on December 25, you must place your order by December 14, the last day from which delivery of items ordered through the Air Miles catalogue will be guaranteed to arrive with Santa.
Top travel choices
There also is a spike in flight redemptions this time of year. The survey found 13 per cent of Canadians plan to use rewards for holiday travel. Sun destinations remain the most popular travel choice, according to LoyaltyOne. This year, the top five holiday destinations for Air Miles collectors are:
3. Dominican Republic
Reward collectors hoping to book flights or other travel for the holidays are advised to book well in advance of their travel dates.
Breakdown for use of loyalty rewards by region
- People in Ontario were the most likely to use rewards for gifts (25 per cent), while people in Quebec were the least likely (14 per cent).
- People in British Columbia were the least likely to say using rewards for gifts is “tacky” (7 per cent).
- People in the Atlantic Provinces were the most likely to put money saved from using rewards towards additional gifts (34 per cent).