KidsFutures loyalty savings attracts attention
The launch of a new microinvestment loyalty programme, KidsFutures, in Canada is attracting much attention to the concept, following the popularity of other similar schemes in the USA, such as BabyMint.
A recent report from Human Resources Development Canada predicts that the cost of a four-year undergraduate degree (without residence) will be almost Cdn$57,000 by 2017. But less than 25% of Canadian children currently have a Registered Educational Savings Plan (RESP) open in their name. The RESP is the Canadian equivalent of the USA's 529 college savings plan.
The new KidsFutures programme, which launched throughout Ontario on October 1st, 2003, aims to help alleviate the problem by providing Canadian families with cash contributions toward their children's college or university education costs. The programme will roll out across the rest of Canada in late 2004.
Free money The microinvestment model is simple: by registering (for free) with the programme, then buying products or services made available by its network of retail and service partners, members earn cash rewards that will be deposited directly into an RESP (managed by asset management firm, Allianz Education Funds). Consumers already having RESP accounts open with other investors can also link their loyalty membership to those accounts.
All cash rewards earned by KidsFutures members are also eligible for the 20% Federal Canadian Educational Savings Grant (CESG), meaning that programme members receive free government contributions as well.
Partner network "Through our wide network of partnerships, we're able to offer Canadians an effortless way to help fund their children's education," said Mark Farrell, CEO for KidsFutures.
The programme launched with a wide range of partners already participating, including Procter & Gamble Canada, Johnson & Johnson, Kimberly-Clark Inc., Sony of Canada Ltd, Kodak Canada Inc., AOL, Best Western International, Chirp, ChickaDee and Owl Magazines, Hasbro Toys, Color Your World, Lexmark Canada, Hakim Optical, MasterCard Canada, Lewiscraft and Allianz Education Funds.
Attracting attention In addition to its existing corporate partnerships, the programme has also attracted the attention of Vesdia Corporation, which operates the popular BabyMint microinvestment loyalty programme in the USA.
The two firms have signed a multi-year agreement through which Vesdia will - apart from acquiring an equity stake in KidsFutures - provide its patented microinvesting platform and loyalty programme management services. The technology and services provided will track merchant rebates from the point of sale, and then deposit them in the participant's RESP account. There are already 2.4 million users of Vesdia's application across all of the firm's microinvestment programmes, including education savings and retirement savings programmes.
"We have been extremely impressed by the KidsFutures team, the progress they have made in the marketplace, and the clarity of the vision they have for their company," said Peter Davis, Vesdia's CEO, and a former Procter & Gamble executive. "Their model adds some unique and meaningful adaptations to the microinvesting concept, and their implementation plan is extremely well thought out."
As observed by Pat LaPointe of loyalty marketing consultancy, MarketingNPV, the new partnership looks like a win-win situation for both companies, and "shows great potential for the whole to be greater than the sum of its parts."
For additional information: · Visit KidsFutures at http://www.kidsfutures.ca · Visit Vesdia Corp. at http://www.vesdia.com