The Decibel - Why your loyalty points don’t go as far as they used to

Episode Date: December 16, 2025

Loyalty reward programs are everywhere we shop. They’re at coffee shops, retailers, airports and grocery stores. Many of us are connected to our points, but the rewards no longer seem to go as far as they used to.Vass Bednar, the managing director of the Canadian SHIELD Institute, explains the changes to Canadian loyalty rewards programs, what we are giving up when we hand companies our data in exchange for points – and if it’s even still worth it to collect rewards points anymore.Questions? Comments? Ideas? Email us at [e-mail] Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Loyalty reward programs are everywhere, from coffee shops to retail, flights, and of course, grocery and drugstores. Collecting points with the promise of discounts or perks brings us a lot of joy, but you might have noticed those points don't go as far as they used to. So what's going on? And is the tradeoff for our privacy and data worth it? Vass Bednar is our guest today. She's the managing director of the Canadian Shield Institute, an independent policy institute focused on strengthening Canada's economic resilience. She'll explain what's going on with these programs, what we give up when we give companies our loyalty,

and whether collecting points is even worth it anymore. I'm Cheryl Sutherland, and this is the Decibel from the Globe and Mail. Hi, Vass, thanks so much for you. coming on the show. Thank you for having me. So you look at how markets work and for who. So I'm really curious about your relationship to points. Like do you collect points? Do you spend them? Or are you kind of like a points hoarder? A points hoarder. I do sort of more passively participate in a few points programs. I would say I'm not active as I used to be, but years ago when I made my will, I actually asked about like bequeathing my points because it felt like a form of value that I had. And

And before I married my husband, I actually felt like it was getting serious when he agreed to merge his PC optimum program with mine. Because I was like, going to be hard done, do this. So if we break up, I'm keeping the points. That's a big deal. Yeah. I feel like for myself, I don't like have all these loyalty programs, but I am very, very tight with the PC points. I don't know what they have that's hold over people. But I am very much like, these points are very important. And I hold them on. And I'm like, I have $30 now. And it's just a big deal for me. You got to go on a special day at shoppers. the like points multipliers space. Yeah, we're all, we're all very like, I think there's like many Canadians that can very much relate to us and being tied to their points. More than half of

Canadians participate in that program. Wow. Okay. So let's get the lay of the land in Canada. Like, what kind of programs do we have here? We have, I mean, all sorts of programs. I think the biggest difference over time that we've seen is a shift from more kind of flat collection based, so collecting stamps, right, kind of volume-based or that kind of OG Canadian tire money where a loyalty program was like actually a form of pseudocurrency to something that is more personalized, more of a closed ecosystem, more kind of tailored and tied to us, which could make it harder to pool in a household like PC optimum, and then allows companies to sort of know a little bit more about us in exchange for what we call.

loyalty. Yeah, and I feel like if you go into any store nowadays, it's like they ask you if you want to sign up for their point. So it's just like, it seems to be expanding and expanding. Oh, yeah. Sometimes at checkout when they're like, can I get your email? I'm like, can I get your email? And we're like, what? No, and I'm like, you're making this weird. No, I'm cool. Like, I just want to buy something and move on. Yeah. So also to point out, this is not unique to Canada, right? Like, everywhere you go, there are loyalty programs around the world. There are loyalty programs everywhere. And they're probably the most direct example of in what's become a very surveillance economy, a more concrete exchange, right? So in other instances where we see

digital companies of all sizes kind of being more extractive, taking as much information from us as they can, that same economy plays out often with loyalty programs. But we, again, have more of a bargain where in exchange for that information sharing, we are receiving something that we or a person perceives to have some sort of value. So I guess there's kind of always two elements with loyalty programs, you know, the terms of that bargain and how much we understand is going on. And then also the stored and potentially eroding value of those, I, you know, I do think it's like a form of currency of sorts, right? We all kind of mentally might have. the value that we have, again, stored up or might be feeling pressure to spend them by a certain

time. And that's one of the main dynamics. Right. So the point of these loyalty programs is kind of to incentivize loyalty from customers, right? Kind of right in the name there. But what exactly is in it for the companies? Like, what do they get out of it? Loyalty programs allow us to be incentivized to purchase more. So spend more and shop more often. So it's in companies. interest in, you know, of course, a competitive landscape to find ways to kind of loop or hook us back. Often with a range of programs, we might self-rationalize, well, we're going to be spending that money anyway. We're going to use a credit card anyway. We're going to get groceries anyway. So you might as well sort of sign up for something. But the reason I find them so

interesting and worth looking at beyond the kind of consumer psychology is because they probably represent a shift in pricing strategies overall that's occurring, you know, throughout the online economy in terms of those hyper-personalized offers, right? When you can only access a discount, a particular kind of discount through loyalty program, then they're also interesting questions there around price discrimination and accessibility. You know, my grandmother's not going to sign up for an app for when she goes for grocery discounts. So are there other ways for her to get a discount on milk, or is she, you know, out of luck? And there's really a value here for companies, right?

I mean, there's a value in terms of money, but also data. But can you talk about this value for companies? So, I mean, there's the value of data, a range of data, both in terms of what we're consuming, maybe what we look at. For companies, loyalty points reflect like a deferred expenditure, right? So Starbucks is a great example. It's very interesting because their loyalty program, their Starbucks, card is also often a prepaid card. So just to parse that out for Starbucks, you could view it as

customers are willing to give Starbucks an interest-free loan. Let's call it what it is, right? They are fronting, when you load your Starbucks card, you are fronting Starbucks cash, but you're fronting yourself cash in a way too. So it represents a liability on their balance sheet because, you know, they've promised an exchange of the coffee or, you know, some other treat that they haven't yet given. And that's the same with points. So that means for Starbucks, I believe last fiscal year was about $1.8 billion USD, which is a lot of money, right? You know, a serious thing. So again, sometimes we dress up loyalty. It's gamified. It's cute. But it's a serious kind of financial element for these companies. And because of that kind of deferred liability element, it could create

incentives, especially in this kind of inflationary period for people to depreciate the value of those points or force people to redeem their points faster or more often to sort of prevent that accumulation. And when you call back to Canadian tire money and that kind of wonderful physicality, I think we've, you know, lots of people experienced that or sort of saw it, you could keep that in a shoebox under the bed and you had what you had. That's changing with loyalty points. Sometimes the bargain, the hook, what brought in, what achieved our loyalty, erodes very, very quickly. And that was something I felt.

I was sort of smelling or picking up on vibes, clicking around Reddit and stuff like that. Yeah, you mean, you've argued that the value of these loyalty programs are getting worse for us as consumers. So tell me why you think that. Like, what's going on? So sometimes they just are, right? Sometimes places like hotels are increasing the threshold,

how many points you need in order to make a redemption. So when you sit down and kind of do the conversion, you're like, oh, I need to spend $40,000 on my credit card in a year in order to get, you know, one night free at a hotel. Is any of this sort of making sense? And why I noticed it the most was because there was just some chatter of the provincial government here in Ontario was considering amending a provincial law. And that law said that points can't expire. And then it was sort of a headline like, hey, points might be able to expire now. I was sort of wondering, well, I wonder who's asking for that. I wonder who's putting up their

hand and knocking on Premier Ford's door and saying, you know what, those loyalty points, here's a policy priority for you. What if they could expire? Yeah, I mean, something I've noticed on this topic of things seeming to be getting worse is airline loyalty programs. Like, I feel like a few years ago, I would be able to purchase almost an entire ticket with my points. And now it's almost not even worth using them because the discounts don't seem worth it. So it seems like they aren't as good as they used to be, but is that true? In some instances, it does seem like, again, the redemption thresholds are increasing, which is a way of devaluing the points, as some people wrote to me. Their sense was, you know, money also expires or erodes in a way it experiences inflationary pressures. So sure,

we could say that loyalty points programs are, you know, also experience. inflation or deflation. But I don't think we can decouple, you know, again, I don't want to dismiss those terms, those changing kind of murky terms of loyalty programs, because I think it happens in this whole kind of this landscape that we experience every day as consumers, where you might be up against shrinkflation, right? The same product, less volume, higher price or the same price. You know, when we have this growing mistrust of markets because we feel that, again, the bargains eroding or that we're being taken advantage of or we always have to be very vigilant, I think that's really important for consumer trust and also trust in the state.

So, again, loyalty points depreciating or changing their value is probably part of the whole competitive landscape where once you might entice consumers to be part of your program because you want to, you know, earn their, again, trust or their, you know, of course, their business, but then as you accumulate that market share, you have less of an incentive to serve those customers in a particular way. All that said, last year, you know, La Blah actually took a financial hit because so many people redeemed to their PCOPA points. Oh, interesting.

Yeah, that's from 2024. So again, back to the, like, it really represents, it's a, it's seen. by the companies on their balance sheets, right, as a form of financial exchange. So for me, that's why I think it's okay for us to say, look, this is or has been a prototypical kind of digital currency. And as we look at the future of money for Canada, if we want people to trust a new stable coin regime or other forms of digital money, I think it's worth reminding people. We have experiences with digital money. And sometimes those experiences are not very good. We'll be right back.

So Vass, it sounds like the bargain for consumers is getting worse. Like we give away a lot of our privacy and yet here we are with all our cards or all of our apps here. Why do people still sign up? Like, why are we so loyal to our loyalty points? Why do we keep them? One, I think we do, people do rationalize. We're going to spend money anyway. So why not?

it couldn't hurt. And again, that makes a lot of sense. These programs are designed to psychologically entice us to, you know, send us nudges. Sometimes they're quite gamified or they have kind of cute levels and kind of different names. And it seems perhaps normal now, right? A normal way to kind of participate. And I don't begrudge anybody for having a favorite, you know, loyalty program or for being somebody who truly believes that a particular brand or store deserves their loyalty, especially in this moment where we're trying to sort of support Canadian firms more and more. What I resent is the reality of how people are exploited for their information and how that bargain, which maybe shouldn't even exist in the first place, right, is steadily eroding for people. Just to throw

back to Canadian tire for a second, because I kind of think this is a fun fact. When they were developing their their credit card right again another way for a company to learn more about you but also provide value um they were looking at you know credit scores and risk assessments and they found that one anybody who had ever purchased something that had a skull on it was actually a very they deemed them a very unreliable person to loan money to however if you had purchased those have you ever gone those little like felt circles that you can put on your chair, like your kitchen chair, your table, so doesn't scrape the ground. Okay, well, people who purchased those, like you, Cheryl, are very, tend to be very vigilant and pay back

their credit cards on time. So how are companies able to use the information that we voluntarily share, you know, to what end and why is it valuable and sort of what makes it, what makes it interesting? Yeah. We've kind of talked around this a bit about like how these companies collect our data, but what kind of information do these companies, actually collect on consumers. In terms of what kind of data these companies are collecting from us, the McDonald's app, there's a report from the Vanderbilt Policy Accelerator from earlier this year that looks at loyalty programs.

And they found that the McDonald's app uses almost like a thousand different data points to start to profile and learn about customers and that they draw you in through, I think it used to be like a monopoly game where you would collect the little stamps, but now they force that into a digital ecosystem. So again, the terms of the exchange are changing and becoming more sophisticated, and I think there are tradeoffs there worth talking about. Their privacy policy for this game, simple game, is nearly 10,000 words, and it notes how McDonald's can monitor our precise geolocation, so exactly where we are at different times,

browsing history, anything we're looking at on our phone, app interactions, other apps that we're using and social media activity. And then the company uses that data to train its AI models and build profiles on us to predict our preferences, characteristics, psychological trends, predispositions, behavior, attitudes, et cetera. And, you know, there's other research, again, this has been done in the U.S., that shows that these loyalty offerings can actually be a bit more predatory. So we typically talk about them in terms of a form of a discount.

But for instance, I'll mention as an example, you know, talk about. Taco Bell, Taco Bell might be able to infer when my payday occurs, which means that they'll make my Gordita offering more expensive. And I think that kind of nudging and extracting the maximum possible price from people, again, this is an example of a trend or shift that's happening in other ways when we're buying things, which is different people are getting different prices. And it's not clear why. So loyalty programs have become more invasive, more sophisticated. And again, their rewards feel like they can be more of a punishment. That's so fascinating. And you talked about how, you know, the privacy policy for this McDonald's app was 10,000 words. And those are the

things that we all ignore, right? We just press, agree. And then we continue on not knowing all the stuff that they're collecting from us. Yeah, I'm like, get me the points. Let's go. Yeah, I want the points. This sounds like there should be rules around this, right? Like, are there any rules in Canada that regulate what information companies can gather on us? There are. I mean, we are waiting right now for new updated privacy legislation for Canada. So a few years ago now, the Privacy Commissioner did an investigation into the Tim Horton's app and found that their loyalty program was collecting an excessive amount of information and that the price of that exchange, even though we weren't, you know, again, paying money for that exchange was egregious when compared to

to the rewards that we were getting. And Tim Hortons did, you know, amend that, uh, somewhat proactively. And I think they gave everyone like a free coffee and a timid or donut. But can you really blame a company if our rules are weak or unclear? Or again, consent people, Tim Horns did receive consent to track people kind of 24-7 through that app. So primarily it is through privacy. Um, also we have consumer protection laws, which are provincial. The Competition Bureau federally has, you know, put out a couple of warnings and considerations around loyalty programs and the claims that they make. So they kind of look at it from false and misleading advertising. But the area that challenges our laws sometimes is that because there's not a direct

monetary value in our information that we're exchanging, the law doesn't see it as a transaction. Okay. So it's viewed a little bit differently. But yeah, We do have legislation. Sometimes like Ontario, we have supplementary kind of elements to points themselves. But as we think about, you know, the kind of economy we want or want to have and how we can better equip people to navigate loyalty programs and understand what's occurring, I think that element is really important and probably not a place that companies are going to go out of their way to, you know, talk. about tracking us. What do you think needs to change then to make these programs more fair? You know, maybe not collect all of our data. I don't know. What do you think needs to change? I don't think people should have to volunteer so much personal information in order to receive

a very modest discount when they're shopping. I appreciate when everybody, no matter your past shopping habits, neighborhood, income shopping. level, et cetera, can access the same discount. I think that people should be able to accrue points for as long as they like without being forced off redemption cliffs, right? We are seeing some programs like Starbucks force you to redeem within six months or they lose their value. That seems unnecessary. Again, if you, if a company wants to take on that deferred cost and make that exchange, then it should be a true exchange that people can redeem kind of when they want. And you know, shout out to anyone who has the vigilance to even notice some of these elements

changing or speak out about it. Again, I think it's easy to scoff and think that caring about these things are silly, but the reality is a lot of us, a lot of people view this as a form of value and a deal that they've made with a company. So as what Corey Dr. O would call as the economy insidifies, or Tim Wu calls it the extraction economy, right? Taking taking more and more and more away from us and away from the economy. I don't think we can leave loyalty programs out of that conversation. The big question is, are points still worth it? I think when you look at everything a company gets to know about us and how we can be exploited, again, for that maximum willingness to pay as a kind of test subject.

you know, how, how much is Vaspin are willing to pay for Miss Vicki's bag of chips? I'll tell you a lot. I like those synthetic foods. It goes straight to my brain sometimes. I really need it as a treat. I'm being a little bit silly, but I think relative to what many of these companies know, it's absolutely not worth it. However, for people who do enjoy, you know, they're able to accrue enough points for that

special flight per year or splurging on a big. holiday meal with their family or getting a cool birthday treat at Sephora, that's great. I would personally prefer loyalty programs to be limited to our transaction information with that one company and not more. Okay, yeah. And just finally here, what are your tips for consumers like in this climate? Like, how do we take back our points power? Consumers exercise power by having choice, by being able to compare prices and kind of keep

a kind of competitive. pressure and discipline in the marketplace. And that's always going to be important. However, it's not our job as shoppers individually to constantly be watchdogs for potential exploitation of loyalty programs. And unfortunately, we have a pretty weak culture of consumer protection in this country. I guess my main tip is just be prepared for loyalty to lie. And something else I saw online people were like just burn your points like just spend them if you if you have some just use them because you don't know what's going to be around the corner yeah don't collect them for eternity i guess that's a good idea no but you should be able to if you want to okay that's a good point

too vast we'll leave it there thank you so much for coming in the show this has been really interesting thank you for having me that was vas bedner managing director of the canadian shield Institute. That's it for today. I'm Cheryl Sutherland. Alisa Wheeler joins us as our Brooke Forbes fellow and is our associate producer. Our producers are Madeline White, Mikhail Stein, and Ali Graham. David Crosby edits the show. Adrian Chung is our senior producer, and Angela Pichenza is our executive editor. Thanks so much for listening and I'll talk to you tomorrow.