Q: I previously owned shares in Coles Myer that gave me a discount on grocery purchases at the checkout. Are there any listed companies that offer shareholder discounts or benefits anymore?
A: Whilst not as popular as it once was, there remain a few listed companies that provide additional benefits and discounts to shareholders. These benefits include discounted mortgage rates, bonus interest on savings, discounts on vitamins, wine, clothing, movie tickets, accommodation and even price reductions on property purchases.
To qualify for benefits, a shareholder is typically required to hold a minimum number of shares, and in some cases, they need to have held those shares for a minimum period of time.
Here is a run-down on benefits I have been able to find provided by ASX listed companies.
Blackmores (BKL) offers shareholders a discount of 30% off the retail price on the purchase of their “over the counter” vitamins and supplements as well as their Pure Animal Wellbeing (PAW), IsoWhey, Fusion Health and Oriental Botanicals brands. Purchases must be for personal use and exclude any products that would need to be prescribed. Orders can be shipped without freight costs anywhere in Australia or can be collected from their Warriewood on site shop.
Shareholders in Bank of Queensland (BOQ) who hold 500 or more shares are entitled to the following benefits; a bonus 0.25% p.a on their Premier Investment Account for balances of $25,000 up to $250,000. Discounts of up to 1.05% on lines of credit. Discounts on personal overdrafts and home loans of up to 0.9%. A discount of 20% on Life Insurance products.
Cedar Woods Properties (CWP) is a residential, commercial and industrial property developer involved in projects in Victoria, Queensland, South Australia and Western Australia. Shareholders are entitled to 5% discount on single residential lots and 2.5% on residential homes and commercial strata units. Shareholders must have owned a minimum of 1000 shares for at least 6 months or hold the shares at the time of “buying off the plan” and retain the shares through to property settlement.
Event Group (EVT) provides entertainment, tourism, leisure and hospitality services. Shareholders who own a minimum of 500 shares are entitled to; 15% discount off the best available accommodation rate at participating Rydges, Atura or QT hotels. When dining at participating hotel restaurants, they are entitled to a discount of 20% on the bill. Terms and conditions do apply and some properties are excluded or subject to block out dates. 10 % discount on Thredbo Alpine Resort accommodation, lift access, lessons, Thredbo Sports retail and Thredbo Leisure Centre. Please read the fine print, additional terms and conditions apply. Discounted Movie tickets are available for the cinemas they own; Event Cinemas, Greater Union, BCC and GU Film House.
Mirvac Group (MGR) owns a portfolio of retail, commercial and residential properties across Australia. Shareholders are entitled to accommodation discounts ranging from 5-10% across the Accor Global network. Travelodge Hotels offer Mirvac shareholders 10% off accommodation in their hotels across Australia and New Zealand.
Mosaic Brands limited (MOZ) formerly known as Noni B offers a discount card for shareholders who own 2000 shares or more. Shareholders receive 10% off purchases at Non B stores excluding the online store.
National Australia Bank (NAB) recently withdrew their shareholder discount programme effective 30 September 2019 but continue to honour discounts for existing shareholders who were part of the programme prior to this date.
Star Entertainment Group (SGR) owns the “Star Sydney”, “Star Gold Coast” and “Treasury Brisbane “. Shareholders are offered a 10% discount on the best available rate for accommodation when the AGM is held at the particular property. Additional terms and conditions apply.
Treasury Wines (TWE) is one of the World’s largest wine companies operating in 70 countries. Shareholders, family and friends in Australia can purchase the company’s wines through the Shareholder Wine Club Cellardoor.co at discount prices.
From a marketing point of view, shareholder discounts make sense. Discounts are a reward for loyal shoppers and shareholders which supports demand for the company’s shares. However a problem cited by companies that have withdrawn their shareholder discount programmes, is that it encourages an unmanageable number of smaller shareholders on share registries. One of the most popular packages was the former Coles Myer’s discount card. Launched in 1993, it was so popular that by 2001 the number of shareholders in the company had swelled from about 68,000 to 580,000. The card was cancelled in 2005, with management saying administration costs made it unprofitable.
Accessing shareholder benefits can encourage investors to hang onto a stock that either underperforms or which is no longer suited to the investor’s goals. Shareholder discounts and benefits are offered at the Board’s discretion and can be withdrawn cut back at any time.
The primary consideration when you invest in shares should be the ongoing dividend yield and potential for capital growth. These factors should significantly outweigh short-term discounts.