Shoppers popular rewards program is about to get less rewarding for its members – and more lucrative for the retailer – just as new generic drug rules start to squeeze the retailer’s bottom line.
Changes to Shoppers’ Optimum loyalty program mean that its members will have to spend at least $800 before they begin to receive benefits, up from $700.
At the highest reward level, consumers who spend $9,500 will now be allowed to redeem $170 in discounts on future purchases. That means they’ll have to buy about $56 worth of products for every dollar in rewards, compared to $50 today.
The Optimum program is important to Shoppers, Canada’s largest drug store chain, because its members spend 60 per cent more on their purchases than non-members. The retailer generates two-thirds of its non-prescription “front store” sales from the cardholders, and it is considered one of the most successful loyalty programs offered by any Canadian retailer.
But drug store chains with a large Ontario presence have been under pressure ever since the provincial government announced radical changes to the pricing and sale of generic drugs, a major driver of profit for pharmacies. Shoppers has warned that the…
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