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A new study by Scene+ and Bond Brand Loyalty produced quite interesting results, almost in contradiction to what we in the miles & points community aim to do with our points. A few things in the study were shocking (mostly the unused loyalty points), while the main takeaway draws many parallels between aspirational redemptions and points to save on everyday spending.
Canadians Are Sitting on Billions of Dollars in Unused Loyalty Points
The study estimates that Canadians are sitting on between $13–15 billion in unredeemed loyalty points. Despite belonging to an average of 15 loyalty programs, 28% of Canadians redeem points only once per year or less.
The findings suggest that the issue isn’t a lack of opportunities to earn points. Instead, Canadians are increasingly looking for rewards that are easy to use. 60% of Canadians prefer small or medium-sized rewards rather than saving points for a large redemption.
The study really drives home that while earning keeps people on the hamster wheel, redemption is playing an increasingly important role in keeping members engaged long-term.
Surprising, But Also Not
While the Miles & Points community tends to focus on aspirational travel, these findings don’t surprise me at all.
A few weeks ago, I wrote about the growing case for cashback credit cards. While we in the points community love to hoard our points and primarily redeem them for business and first class flights, that’s never been the case for most Canadians.
Most people I know sign up for whichever loyalty program a retailer promotes (T&T Rewards comes to mind) and redeem points whenever the cashier offers a discount at checkout.
Even so, I’m still shocked that Canadians leave $13–15 billion in loyalty points unredeemed and that 28% redeem points only once a year or less. On the subject of Canadians preferring everyday savings to aspirational redemptions, it’s easy to see why programs like Scene+ have expanded well beyond their original use case of movie rewards.
Shell just joined Scene+
We see banks continue to invest heavily in programs such as TD Rewards, BMO Rewards, and CIBC Aventura. While travel remains the best use of these points, the programs have increasingly expanded simple redemption options that allow cardholders to redeem points for gift cards, merchandise, and more. Yet despite those straightforward redemption options, Canadians are still sitting on billions of dollars worth of unused points.
Redemption Confusion Isn’t Exclusive to Flexible Rewards
There’s an interesting parallel here. In the miles & points community, we often complain that redeeming for premium-cabin travel has become more difficult due to dynamic pricing, shrinking award availability, and rising costs. Yet this study suggests that even Canadians collecting simple fixed-value rewards aren’t redeeming points regularly.
The common thread isn’t the type of reward currency. It’s that loyalty programs have become very good at getting people to earn points, but not necessarily as good at getting them to use them.
When my friends and family ask me about which credit cards to sign up for, I say Scotiabank for high earn rates at Sobeys and then easy redemptions on their next grocery bill. After all, redeeming Scene+ points at Sobeys has the same 1CPP redemption value as redeeming for travel.
Scene+ has the same redemption value whether redeeming for travel or groceries at Sobeys
For engaged hobbyists, transferable rewards can still offer significantly higher value. An Aeroplan redemption in business class will almost always outperform redeeming points for groceries or fuel on a cents-per-point basis.
But theoretical value only matters if points actually get redeemed.
Takeaway
The takeaway from this study isn’t that travel rewards are losing relevance. It’s that many Canadians value rewards they can redeem often and understand immediately, whether that’s money off groceries, fuel, or everyday purchases.
For loyalty programs, that means redemption needs just as much attention as earning. Getting people to collect points is one thing; getting them to actually use those points is what keeps them engaged.
That said, I can’t help but wonder how many people surveyed have ever seen what’s possible with points. Would some of them still choose $10 off groceries if they knew that using a different credit card could potentially unlock a lie-flat seat across the Atlantic?
Perhaps that’s my bias showing. Then again, if Canadians are sitting on up to $15 billion in unused points, maybe the real lesson is that earning points is the easy part. Whether you’re collecting Scene+ points for groceries or Aeroplan points for business class, figuring out how to redeem them is what matters.
