BMO Bank of Montreal

BMO Bank of Montreal

November 02, 2011 10:28 ET

REPEAT: Despite Economic Uncertainty, Majority of Canadians Plan to Vacation this Fall and Winter

Domestic and Inbound Travel Generated About $30 Billion for the Canadian Economy in 2010. If Fall Travel Plans Hold Up, it Would Be Welcome News for the Canadian Economy.

- Wanderlust - 61 Per Cent of Canadians Plan to Vacation This Fall or Winter.

- Seize the Day - 59 Per Cent Say They Will Not Change Their Travel Plans as a Result of Current Economic Uncertainty.

- Slight Decline After Steady Rise - After Seven Consecutive Quarters of Gains in Tourism Spending in Canada, Averaging 0.9 Per Cent a Quarter, Spending Decreased by 0.1 Per Cent Last Quarter.

TORONTO, ONTARIO--(Marketwire - Nov. 2, 2011) - Despite lingering uncertainty over the state of the economy, Canadians continue to travel. According to a new survey released today by BMO Bank of Montreal, 61 per cent of Canadians will take a fall or winter holiday this year (compared to 79 per cent who vacationed in the summer). Survey respondents say current economic volatility has not affected their vacation plans.

"Tourism generated about $30 billion for the Canadian economy in 2010, or 2 per cent of GDP, and about 4 per cent of the labour market has a direct link to the tourism industry," says BMO economist Robert Kavcic. "So, if travel plans can hold up despite economic uncertainty and lower consumer confidence, it would certainly be welcome news for the Canadian economy."

In addition, one in five is taking advantage of a strong Canadian dollar to head out of country; 14 per cent say they are heading to the United States, while 5 per cent plan to vacation outside Canada or the U.S.

The study, conducted by Leger Marketing, also revealed that the younger you are, the more likely you are to travel out of country:

  • Canadians under 44 years old were twice as likely to be travelling outside of Canada (26 per cent) than those over 44 years of age (13 per cent).
  • Almost 20 per cent of Canadians under 44 who are planning to travel, plan to travel to the United States versus 9 per cent of those over 44.
  • Those under 44 are only slightly more inclined to vacation outside Canada or the U.S. (6.5 per cent) than those over 44 (4 per cent).

Strong Canadian dollar fuelled travel outside Canada in first half of year

Travel within the country remains the most popular with Canadians. However, the strength of the Canadian loonie, which has been close to or over parity with the U.S. dollar for the past year, has led to more trips outside Canada. Outbound travel by Canadians grew by 5.5 per cent year to date to June 2011, with most of that growth comprising travel to the United States.

Canadians watching their travel budgets

In a survey conducted in May, Canadians told BMO that affordability was a key consideration when they made vacation plans. Yet in BMO's follow-up fall/winter travel survey, only 13 per cent of those polled said they will use loyalty rewards to lower vacation costs.

"Canadian consumers are increasingly more knowledgeable about the value of rewards programs. In fact, rewards programs are the number-one determinant in the choice of a credit card," said Su McVey, VP, Customer Communications & Marketing, BMO Bank of Montreal. "In today's economic environment, I would encourage every Canadian vacationer to take full advantage of their travel-related rewards to reduce their holiday expenses."

BMO's Fall Travel survey revealed that those travelling this season with incomes greater than $100,000 were the most likely (19 per cent) to use travel rewards to lower vacation costs.

"Extra features -- often included with premium cards like the BMO World Elite MasterCard -- such as trip interruption and cancellation insurance, travel medical insurance, rental car collision waivers and airport VIP lounge passes, can also substantially reduce travel costs. So, it is important to know the benefits of your credit card. If you're not sure, call your bank or check online for confirmation."

Unforeseen events like an accident or illness, or an emergency back home, can be extremely expensive and quickly eat up savings if travellers do not have the appropriate travel insurance coverage.

BMO's 2011 Fall/Winter Travel Survey was conducted from September 6-8, 2011, by Leger Marketing. The sample was 1506 Canadians, 18 years or older. The margin of error is plus or minus 2.5 per cent.


Tips to Maximize Loyalty Rewards

Loyalty programs are the number-one determinant for consumers when selecting a credit card. Here are a few tips to maximize collection of those loyalty rewards.

1. Shop and compare to ensure you select a credit card with a robust rewards program, like BMO MasterCard's AIR MILES and World Elite loyalty programs. Look at the redemption ratio (what the points are actually worth) and the flexibility of the program - does it offer travel, merchandise, cash back, financial products and charitable donation options?
2. Expiration date? Determine whether and under what conditions your points expire. Opt for programs, like BMO's, where the points don't expire.
3. Focus on one loyalty program. Consolidate all of your purchases on a single card so that you can accumulate rewards faster. Doing this also makes it easier to track and monitor your spending.
4. Capture your entire spend. Make sure you earn rewards on even your minor day-to-day expenses, such as coffee, fast food, or convenience store items. Consider using PayPass for smaller-value purchases. It is fast, convenient and allows you to collect rewards. For purchases under $50, you simply tap the PayPass enabled card or mobile device to the PayPass reader, and go. No personal identification number, swipe or signature is required.
5. Try a triple play. Why not earn rewards three times? You can do this by shopping at a loyalty program sponsor, paying for everyday purchases using a loyalty credit card and taking advantage of in-store or online bonus offers. The triple play lets loyalty program collectors earn points at a much faster pace.
6. Redeem points to offset your vacation costs. If you have a flexible program like BMO's World Elite or AIR MILES loyalty programs, you can redeem points for flights, cruises and other package holidays, train travel, gas, hotels, restaurant gift cards, passes to local attractions and more. Plus, with BMO World Elite, if you don't have enough points to redeem for your trip, you can use what you have and then "top-up" with cash – for any amount.
7. Use the travel insurance features of your credit card. Certain premium cards like the BMO World Elite MasterCard and BMO Gold AIR MILES MasterCard provide trip interruption and/or cancellation insurance, travel medical insurance, rental car collision waivers and other benefits, such as airport VIP lounge passes. These benefits can substantially reduce travel costs. So, know and use your card features and benefits, and when in doubt call your bank's contact centre or check online for confirmation.

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