TELUS Corporation: Loyalty-Driven Dominance in Canada's Telecom Sector

In a Canadian telecom landscape dominated by giants like Bell and Rogers, TELUS Corporation (TSX: T) is quietly rewriting the playbook. By doubling down on its tiered loyalty program expansion—even amid short-term criticism over reduced points redemption value—TELUS is positioning itself to lock in customers, carve out a 20% market share in Eastern Canada by 2025, and establish an unrivaled “telecom-plus” ecosystem through partnerships like WestJet. For investors, this is a recipe for sustained revenue growth in an industry primed for consolidation.

The Loyalty Lever: Retention at Scale

TELUS’s customer retention metrics are a masterclass in stability. With a postpaid mobile churn rate of just 0.84% in Q1 2025—the 12th consecutive year below 1%—the company has built a fortress around its subscriber base. This outperformance isn’t luck. It’s the result of a bundled service strategy (mobile + home internet + TV) and hyper-localized loyalty incentives. In Eastern Canada, where competition is fiercest, TELUS tailored its program to address regional pain points:

• Rural broadband discounts to bridge the digital divide.
• Premium streaming add-ons for urban tech-savvy users.
• Real-time data analytics to refine offers based on regional demand trends, like surging 5G home internet adoption.

The result? A 12% jump in Eastern Canada market share by 2024, driven by 35% higher loyalty program enrollment versus 2022. TELUS isn’t just retaining customers; it’s turning them into brand advocates.

The WestJet Partnership: Building a Telecom-Plus Ecosystem

Where TELUS truly differentiates itself is through its telecom-plus ecosystem, exemplified by its WestJet partnership. This isn’t just a loyalty program tweak—it’s a strategic move to monopolize customer attention across sectors. By 2025, the partnership will:

• Offer free Starlink-powered Wi-Fi on all WestJet flights (via TELUS’s infrastructure), a perk unmatched in North America.
• Link TELUS rewards with WestJet’s ecosystem, allowing customers to earn points for telecom services and redeem them for travel perks—creating a flywheel of cross-selling.

The integration goes deeper: TELUS customers get discounted streaming bundles, 5G+ international plans, and cybersecurity tools bundled with travel rewards. Meanwhile, WestJet flyers gain access to TELUS’s PureFibre broadband and AI-powered customer support. This synergy turns TELUS into a lifestyle brand, not just a telecom provider.

Addressing the Criticism: Why Reduced Redemption Value Isn’t a Detriment

Critics argue that TELUS’s reduction in points redemption value (e.g., shifting from WestJet Dollars to Points at a 1:100 ratio) could hurt short-term engagement. But this is a calculated trade-off:

1. Simplified Ecosystem: Points never expire, and redemption flexibility is expanded. Customers can now use points for 100% of flight costs—including taxes and fees—creating a clearer path to high-value rewards.
2. Cross-Selling Upside: By tying redemption to broader ecosystem partners (like WestJet), TELUS increases the average revenue per user (ARPU). A customer redeeming points for a flight might also buy TELUS’s 5G plan or security suite.
3. Long-Term Loyalty: The telecom-plus ecosystem builds stickiness. Why switch carriers if doing so means losing access to free Wi-Fi on your favorite airline?

Why Investors Should Act Now

TELUS’s strategy is a textbook play for monopolizing customer lifetime value in a consolidating market. With 87% of Canadians now covered by its 5G network and $1.8B allocated to capex in 2025, the company is future-proofing its infrastructure. Meanwhile, its loyalty playbook—validated by a 99.16% retention rate—ensures that revenue grows with every new customer retained.

Final Analysis: A Buy for the Long Haul

TELUS isn’t just a telecom company—it’s a loyalty tech pioneer. Its willingness to weather short-term redemption value criticism for long-term ecosystem dominance is a bet on customer stickiness in an increasingly fragmented market. With a targeted 20% Eastern Canada market share on the horizon and partnerships like WestJet amplifying its reach, TELUS is primed to outpace rivals in an industry ripe for consolidation.

Investment Thesis: Buy TELUS for its loyalty-driven retention machine, telecom-plus ecosystem, and strategic regional focus. The stock is undervalued relative to its growth trajectory—this is a buy-and-hold opportunity in a sector where loyalty equals longevity.

Disclosure: The author holds no position in TELUS or related securities. Analysis is based on publicly available data.