More than two-fifths of Canadians (42%) think that loyalty programmes and incentive points toward travel, groceries, and retail goods are an important consideration when they look for a mortgage, according to a homebuyer survey from President's Choice Financial and Ipsos-Reid.
Despite competitive interest rates and other offers and benefits commonly associated with mortgage acquisitions, the Canadian research suggests that banking and financial services customers are now also carefully considering the real benefits of loyalty programmes. Customer loyalty programmes are increasingly on offer to those looking for financial services such as mortgages.
"Canadians are extremely mortgage savvy," explained Geoff Wilson, vice president of industry and investor relations for Loblaw Companies Ltd, which designs financial products for President's Choice. "They want - and expect - not only great rates but options and perks such as flexible payment options and bonus points that will suit and even enhance their lifestyles."
The survey polled Canadians who are personally involved in decisions about mortgages. When asked about the importance of specific aspects of their decision-making, travel bonus points were cited as important among British Columbia and Atlantic region residents (50% and 61% respectively), while Ontarians and residents in the Prairie provinces said it was important to receive points toward merchandise (almost 45% in each region).
Gender was also noted as being significant in the survey, with 35% of women saying that, if given a choice, they would prefer bonus points redeemable toward free groceries, compared to only 28% of men. For other options, however, men and women displayed much closer preferences, such as the promise of a free trip (35% of women, and 34% of men).
The survey also found that 54% of mortgage decision-makers under the age of 35 think it is important that mortgage lenders offer loyalty programmes with bonus points toward retail items, in addition to a competitive rate of interest. For the 35 to 54 age group, however, the figure falls to 41%, and only 25% in the 55+ age group.
Word of mouth, too
But points and good interest rates are not the limit of what consumers want, either: some 58% said it is important to have friends or family recommend a mortgage lender (63% of women thought this, compared to only 52% of men). Furthermore, 70% of those under the age of 35 said it is important to have a mortgage lender recommended by friends or family, compared to 53% of those over 35.
The Ipsos-Reid poll was conducted by telephone during August 2003, on behalf of President's Choice Financial, and included responses from 885 randomly selected Canadian adults who were personally involved in decisions about a home mortgage at the time.
Financial loyalty programme
President's Choice Financial services offers its own PC Points loyalty programme, where points can be earned from mortgage products, and later redeemed for travel, retail goods, and groceries.
The firm's PC Points can be redeemed starting at 20,000 points (at an exchange rate equivalent to 1,000 points per Cdn$1), with rewards including household goods, groceries, last minute travel, and gift certificates from Chapters, Indigo, Coles, Blockbuster and Famous Players.