Evolving Blue Rewards with Loyalteez

BMO paid $160 million for a bankrupt loyalty program. Here's how to turn that liability into a growth engine.

Blue Rewards inherited Air Miles—a coalition program that watched Shell, Sobeys, Safeway, Staples, Rexall, and Amex walk away over the years. The 2016 expiry crisis destroyed customer trust. And the fundamental model—where partners subsidize each other—guarantees ongoing defection.

Coalition loyalty is a zero-sum game. Protocol loyalty isn't.

The Old Model: Coalition Economics

The Core Problem

In a coalition, customers earn points at Partner A and redeem at Partner B. Partner B effectively subsidizes Partner A's rewards. When the economics don't work, partners leave.

The Math That Doesn't Add Up

For Collectors

1. Confusing value — 1,500 points = $10 is hard to mentally calculate
2. Daily limits — Redemption friction frustrates customers
3. Shrinking network — Partner defections reduce earning/redemption options
4. Trust issues — 2016 expiry crisis still resonates

For BMO/Blue Rewards

1. Unknown liability — Deferred obligation from acquired program
2. Partner negotiations — Constant economics discussions
3. Defection risk — Any partner could be next

The Loyalteez Redesign

From Coalition to Protocol

Investment Structure

Each participating brand independently decides:

How to Implement It

Partner Earning (No Subsidization)

// Each coalition partner sends own events
// Example: Grocery partner earning (formerly Blue/Air Miles partner)
await fetch('https://api.loyalteez.app/loyalteez-api/manual-event', {
  method: 'POST',
  headers: { 'Content-Type': 'application/json' },
  body: JSON.stringify({
    brandId: process.env.GROCERY_BRAND_ID, // Each partner has own brand ID
    eventType: 'place_order',
    userEmail: customer.email,
    domain: 'grocerypartner.com',
    metadata: {
      partner_network: 'blue_rewards_evolved', // For cross-reference
      order_id: transaction.id,
      order_value: transaction.total,
      // Crosswalk: Old coalition pooled points, subsidization issues
      legacy_points_issued: Math.floor(transaction.total),
      // New: Each partner funds own LTZ
      ltz_earned: Math.floor(transaction.total * 10) // 1%
    }
  })
});

// Customer's LTZ is portable but each brand controls own investment
// No partner defection because no subsidization

Point Conversion Path

// Transition existing Blue Points to LTZ
// 1,500 Blue Points = $10 value = 100 LTZ (at 10¢/LTZ)

const conversionRate = {
  bluePointsPerLtz: 15, // 1,500 Blue Points → 100 LTZ
  valuePreserved: true   // Same $10 value
};

// Collectors retain value, gain portability

See: Custom Events Guide

Before/After Summary

For BMO/Partners

For Collectors

The Headline

BMO paid $160M for 10 million collectors and 400+ partners.

On Loyalteez, that's not a liability to manage—it's a network to activate.

Each brand funds its own rewards. Each collector owns their value. The network amplifies everyone.

That's not a coalition. That's a protocol.

See Also

• Evolving Scene+ — Another Canadian coalition facing similar challenges
• Core Concepts — Understanding portable currency