Loblaw to merge Shoppers Optimum and PC Plus loyalty programs

Loblaw Companies Ltd. and Shoppers Drug Mart are merging two of the most popular loyalty point programs into one, in a new venture called PC Optimum.

Starting Feb.1, anyone who is a member of either PC Pluspoints or Shoppers Optimum will be grouped into thenew points program, where their account balances will be transferred over at par.

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The lone exception where the move isn't automatic is in Quebec,where Shoppers Drug Mart operates under thePharmaprixname. In that province,thePharmaprixOptimum program will end on Jan. 31 next year and members will have until May 2 that year to redeem their points or convert them at equal value to the new program.

The move has been long anticipated eversince Loblawbought the drug store chain in 2014. The PC points program currently has about 11 millionmembers. Shoppers Optimum, meanwhile, counts 8 million members.

TD Bank analystMichael Van Aelstsays about half of that total pool of 19 million membersare already members of both programs, so the chain is hoping to grow by catering the other chain to the other half.

All in all, points will accrue and can be spentat all of the chain's retail brands, including:

• Real Canadian Superstore.
• Atlantic Superstore.
• City Market.
• No Frills.
• Independent.
• Zehrs.
• Loblaws.
• Shoppers Drug Mart.
• Shoppers Home Health Care.
• online at JoeFresh.com and BeautyBoutique.ca.

Once the system is set up, members will be able to accumulate and spend points interchangeably at all the chain's 2,500 different stores and websites.

While points will be moved over at par, it will be easier to earn new ones at Shoppers than it will be at Loblaws.

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Under the current system, PC points members can redeem 20,000 points to get $20 worth of groceries. The number of points they earn per dollar spent at Loblaws stores varies depending on the person, and the products in their personalized offers in any given week.

Shoppers Optimum points members currently only have to redeem 8,000 points to get $10 worth of goods,but all customers will earn 50 per cent more points for almost every dollar spent at Shoppers Drug Mart locations to help accountfor the higher number of points needed for each redemption level.

• Click here for a calculator to see how many points you'll get after conversion

Van Aelst sums up the changes like this: "Those that had redeemed more frequently at lower tiers will see slightly better returns while those that had previously chosen to maximize point value by stock-piling points to redeem at the highest tiers will see slightly lower returns."

"Conversion of existing Optimum points will be done at the highest eligible tier," he said.

Customers of both chains have been requesting this changefor a while now, Loblaw'ssenior vice-president of loyalty and consumer insights Jim Noteboom said.

"Make it one program, that's easy to understand and easy to earn, with points that are redeemable at all stores," he said collectors told the company while it gathered research on its loyalty cards.

Follows split with CIBC

Analyst speculation about a points merger has heightened since August when CIBCand Loblaw's PC Financial announced they would end their nearly 20-year relationship.

• CIBC swallows PC Financial, rebrands as Simplii

In its place, CIBC launched Simplii Financial a no-fee direct banking brand on Nov. 1. In the breakup, savings, chequing and mortgage accounts went with Simplii, while MasterCard credit cards and the PC Plus points program remained with PC Financial.

The change means PC Financial debit card holders no longer earn PC points when using those cards.

Both companies said that the end of the company's relationship with CIBC was unrelated to the decision to merge both programs, which has been in the works for a few years.