Sarah Deveau: Money Matters


The Lowdown on Bonus Air Miles

Are They Worth It?

My local Safeway has been trying to win back business from competitors, and recently began running coupons offering 250 bonus Air Miles with $100 grocery purchase, or 500 bonus Air Miles with a $200 grocery purchase.

As a frugal grocery shopper, committed to paying the cheapest price possible for our food, I keep a detailed spreadsheet with products, sizes, and the lowest price I’ve ever seen our favourite products sold at.

Armed with the Air Miles coupon and my list of the best prices, I went to Safeway to see if I could still take advantage of this great Air Miles deal without spending more than I would buying the same products at other stores, such as Superstore or No Frills.

If you want a nitty gritty list of what I bought and how it compared at each store, you can check it out on my blog on my Money Smart Mom website.

I spent $14.65 more at Safeway than I would have if I had bought those items at the lowest price I’ve seen at other stores. Because I only buy items when they’re at the lowest price, I compared the shop against that list, not what the same items were selling for at other stores at the time of my shop. For instance, I overpaid by a dollar for Laughing Cow Cheese because I paid $6.99 for it, when I’ve seen it on sale for $5.99. However, that day it was not on sale at any of my local grocery stores for the best price of $5.99, but I wouldn’t have normally bought it if it was not on sale.

With the bonus deals in store, the base Air Miles offer (1 AM for every $20 spent) and the 500 Air Miles bonus coupon, I earned 740 Air Miles, and I consider that those Air Miles “cost” me $14.65.

So what can I get with 740 Air Miles. Turns out, a great deal more value than $14.65.

175 Air Miles = Admission for 2, plus 2 pops and 1 popcorn at Empire Theatres ($30 - $46 value, depending on day of attendance)
740 Air Miles = 4 passes (with 40 AM remaining) = $120 - $184 value
175 Air Miles = $20 gift card to Sobeys
740 Air Miles = 4 gift cards (with 40 AM remaining) = $80 value
225 Air Miles = $25 gift certificate at Gap
740 Air Miles = 3 gift cards at Gap (with 65 AM remaining) = $75 value

Air Miles roughly seem to translate into being worth $0.125 in cash-like redemption value, sometimes a little more, sometimes a little less.

From talking to friends in other cities, it seems like their usual spend $200 Air Miles deal gets them 250 in Air Miles. Assuming a deal like that, I would only have received 490 Air Miles.

I could easily have spent $200 on my Safeway visit that would only have been $100 at No Frills by picking the wrong things. With the $0.125 valuation, the 740 Air Miles are worth $92.50 - in that case I'd be losing money, but only a little bit. However, if the Air Miles deal had only been 250 I would have had just 490 Air Miles - $61.25 worth. If the same groceries could have been elsewhere for $100, in the big financial picture you're $50 in the hole.

So has Safeway won me back? As long as they’re running this super Air Miles offer, definitely. I’ll go armed with my best price list and shop the staples.

However, if you’re not obsessive about your pricing, you could easily spend overspend by $60 - $100 or even more on a $200 load of groceries compared to the best price at other stores. And Safeway does not price match - so you can't run an end game that way.

At Safeway, many products were twice the regular price of other stores, and some items were three to four times the sale price at other stores. Our brand of bagels were $4.79 at Safeway, $1.50 on sale at No Frills, and when they're at the lowest price, they're just $1.

It would be easy to think you're getting great value by loading up on Air Miles when really you're spending more on groceries than the rewards are worth.