When loyalty programs have a cost

It feels impossible to get ahead economically, Not for a lack of trying. You make your own lunch, walk to save transit money, thrift clothes. 

Inflation hit the cost of food, so we buy in season and hope you can stock up when it’s on sale. Then, ‘Shrinkflation’. This was a problem in feminine hygiene for decades, now it’s a wave across the food and cleaning product landscape.  Brands we love are suddenly 25% smaller but cost the same. Bottles change shape, and lower the portions inside. And we adjust again. Making a part time job out of finding a sale for the products you use every day. It’s stressful. 

You have something to help, I guarantee it. We all belong to at least one. 

A loyalty program. Or a Rewards Program, or a Membership. THey first started as cards, and then moved to apps. I at one point cancelled most of my reward program profiles, tired of carrying cards everywhere.

 I still do have my original Air MIles Card and my first Starbucks Gold card. No mistake, this is about loyalty and personal attachment. 

PC Optimum, Air MIles, ScenePoints, there are dozens that claim to help you grab some of your money back. It came from much more humble beginnings.

Punch cards are one of the first I remember being a part of. It’s the lower end of programs, low tech, easy to control. Used by coffee shops and other businesses that experience regular customers. It’s worth carrying around. If you’re a regular anyway, might as well get a freebie once in a while. 

A Points based system.  One of the more popular types of programs. Starbuck has stars, Air Miles has miles, many names for the same thing. Currency. In this system you collect a currency to spend exclusively in that store. There are usually promotions for bonus currency, and retention offers if you haven’t used the program for a while. Each program has rules for use and redemption. 

SUBSCRIPTIONS! Woooboi. This is a biggie. Everyone has paid for a subscription or membership they forgot about.  From streaming services to gym memberships, it’s the easiest way to make extra money as a business. I have forgotten about Twitch subscriptions for a year. I have also ignored the cost of spotify as it doubled in price since I started it. It’s so easy to set up, and after a few payments, it slips into your monthly cost. The permission we give these services to auto renew usually comes back to bite us.

Thankfully there are little things to make the most of loyalty programs. It takes a little effort and forming some good habits. But I think you will see in the long term that it can make a difference. 

Deciphering expensive promotions is one of the first things to learn. You never really ask for them, but they keep showing up. Buy 3 things and get 100 points. Buy said product at a different time of day, and get a cookie. They are really dangerous because it gives you faster gratification than waiting for more points, but the return is negative in most cases. Spending that extra time and money will never be worth the price (or especially cost) of the cookie. Buying 3 products you normally wouldn’t purchase are not worth the five dollars worth of ‘free’ points.

Business loyalty. This requires a bit of planning. Yes buying things at your store for points is a good idea. But if there are cheaper or sale item somewhere else, that is better in the long run. Saving $2 today is better than spending money to get that $2.

Subscription reminder apps are a great weapon against auto renewals. Having these schedule alarms for a few weeks before payment will occur. Whether it is a free trial ending, or you want to cancel closer to the end of the period, This will help. 

Some are just no longer valuable. I was surprised by this, I didn’t think it could happen. But the spike in inflation the past five years had made some loyalty currencies close to worthless. Having spent years collecting for $100 credit only to have $100 buy nothing you could want.  

My message today is to, shopper beware. Businesses are looking for anywhere possible to save money, and these programs are no exception. Make sure you know what they are giving you, and if it is worth it. Happy saving!