Air Canada’s move to spin off its Aeroplan loyalty program was hailed as a massive win for everyone when the transaction went through. Passengers would get a dedicated group running the points scheme, more flexible and able to add more partners while the airline got a truck load of cash as a lump sum, plus ongoing payments for flight redemptions. Through the years since the spin-off the relationship has been held up as an example of how an airline could realize the true value of its loyalty program rather than keeping the operation in house.
As of 30 June 2020 that experiment will come to an end. Air Canada’s contract with Aimia, the company running Aeroplan, expires on the 29th and the airline is set to relaunch loyalty internally rather than renew the contract.
By operating its own loyalty program, Air Canada will be better able to strengthen its customer relationships and deliver a more consistent end-to-end customer experience.
“Our relationship with our more than 45 million customers sits at the core of Air Canada’s ongoing transformation as we continue to grow our business beyond the 200 destinations that we already serve, and work to become a global champion,” said Calin Rovinescu, President and Chief Executive Officer. “This decision is the right one for our customers, our employees and our shareholders.”
While it is good to have the details three years in advance, it also presents many challenges for customers and the two companies. We know today, for instance, that points earned in Aeroplan will be locked there when the transition occurs. There will be no migration of Aeroplan points into whatever the new Air Canada loyalty scheme is named. And while Aeroplan will continue to be able to redeem for travel, it is likely the rates will shift from the current numbers. Redemption on Star Alliance partners will disappear from Aeroplan as part of the transition.
- Aeroplan miles earned up to June 2020 will stay in Aeroplan members’ accounts, and will continue to be subject to the conditions of their program.
- Air Canada intends to continue to offer Aimia redemption seats for Aeroplan members after June 2020, with pricing competitive with other third-party rewards programs.
Put another way, while earning in Aeroplan today likely still makes some sense, passengers should be considering a change towards the 2019-2020 timeframe so they don’t end up with points orphaned in a program that no longer has access to the desired award seats.
Further details are expected from the company in an Investor Day briefing on 19 September 2017.
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