What’s the point of a loyalty program? (Pun intended.) In a perfect world, offering the best products and services would be enough to earn customer loyalty, but the world is not perfect. Sadly, excellence is not the aspiration of many businesses, especially if they think they can get away with cutting corners.
In a complex and crowded marketplace customers demand and expect more – or are willing to accept less, for the right offer.
Businesses gain advantages through loyalty programs
One way businesses can compensate for lapses in the experience they offer is implementing a well-developed and effectively executed loyalty program. Considering the benefits loyalty programs offer – revenue from repeat clients and customer insights, as well as cover for deficiencies – it is no surprise that they have become a staple for many businesses from grocery chains to airlines, from clothing/lifestyles retailers to casinos.
For businesses, a loyalty program is a way to help convince customers to choose your products and/or services over those of your competitors.
Loyalty programs are a means of improving retention, winning wallet-share, and increasing a customer’s lifetime-value.
The more behavioural data a business has on its customer-base, the more effective it could be in targeting its offering to customers’ needs and preferences.
Loyalty programs also have to offer customers value.
The yin to the yang is that to be successful, the loyalty program actually has to offer – and deliver – something customers perceive to be valuable.
Today, most sophisticated consumers are aware, if only subconsciously, that they are exchanging their privacy – as I have written about in a previous blog – as well as their money to earn benefits in a loyalty program.
Air Canada is out-of touch with the customer's experience of the Aeroplan Elite program.
Which brings me to the purpose of today’s blog: a recent email I received announcing changes to Air Canada's Aeroplan Elite program. This email made me question whether Air Canada was in touch with how its members were actually experiencing its program.
Let me start with something positive: I appreciated it when Aeroplan’s Altitude program – rebranded as Aeroplan Elite in 2020 – made the decision to permit members maintain their status in the year following the onset of the pandemic. It was a smart move that recognized the major disruption to business and personal travel that had resulted from government health restrictions around the world. The decision demonstrated an understanding that when its customers started travelling again, they would be unhappy – and consider other options – if Air Canada had revoked their status and associated privileges as a result of circumstances beyond the customer’s control.
What I did not appreciate was an email I received on October 26, 2022, advising me of upcoming changes to the Aeroplan Elite program in 2023 and reminding me to use my Elite Status benefits before the end of the year. In theory this was a helpful and proactive communication, so you may be wondering why this message was so irritating to me? It was annoying because I have not been able to use some of the benefits associated with my status due to lack of availability.
Specifically, this year I have attempted to use my e-upgrade credits every time I fly without success. (This is not insignificant: I requalified for my status in Q3 of this year, so I am flying regularly.)
The list of people waiting to upgrade is far in excess of the available seats in business class on any given flight on the more popular routes.
Last week, for example, I returned home from Toronto on a Friday evening and 14 of 16 seats in business class had been sold, all 14 passengers had checked in and there were more than 20 people on the upgrade list vying for the remaining two seats.
Based on my experience this year, if you’re in the bottom two tiers of Elite status it is next to impossible to get upgraded with your credits.
It was not this way before the “trouble.” I suspect that the lack of access to this benefit is the result of the contracted flight schedule. Still, this is something the airline should be aware of and communicating to its customers to manage expectations – not reminding us that the e-upgrade benefit is basically useless.
More examples of Air Canada's failure to deliver benefits.
On the same trip I tried to activate one of my transferrable lounge passes and was told that the domestic Maple Leaf Lounge at Toronto’s Pearson airport was not accepting guest passes due to capacity issues. We could try back later.
Another disappointment: this month my husband and I attempted to use our significant stock of banked Aeroplan points to book business class flights to participate in a cultural tour in the classical Mediterranean world in 2023. We discovered that business class travel for the entire trip would not be available for any number of points. We also learned that in addition to the more than 200,000 Aeroplan points required to book the “mixed cabin” trip on offer, there would be a cash contribution of nearly $2,000 per person – which is just under the cost of an economy class seat. This did not make us feel like we would be getting a reward!
The thing about benefits is that they have to offer something you can use for them to have any meaning or any sense of value. While we all value different things, if the benefit is offered it should be accessible.
I understand not all readers can relate to the difficulties I am describing; however, most would acknowledge that air travel has become quite inhumane since 2001 and has deteriorated further since 2020. We have all heard stories about people who have had their holidays ruined by cancelled fights and lost luggage, and these stories are upsetting. It is sad to think of people who have been saving for a vacation for years only to have their holiday ruined and money lost by airline incompetence. Please, have a little empathy for those of us who travel more frequently, often for business. We are constantly dealing with changed flights, late flights, missed connections, lost and delayed luggage, and more. Business travel is not glamourous. The benefits we receive in exchange for our loyalty to an airline, and by association its lager group affiliation (Air Canada/ Star Alliance), do make a difference. We have paid for these privileges with our time, privacy, and cash.
Some Aeroplan Elite benefits are working
Of course, not all of the benefits offered through the Aeroplan Elite program are inaccessible. There are some benefits Air Canada is able to deliver consistently: dedicated phone line, discounted preferred seats, priority check-in, free checked bags, priority-baggage handling, expedited security lines, and priority boarding.
The e-upgrades and lounge passes, which will all expire at the end of the year, will be unused because Air Canada is unable to deliver, not for lack of effort on my part.
Changes to Aeroplan Elite 35K
What frustrated me about the October Aeroplan communication was that Air Canada appeared to be oblivious to the way in which its own program was experienced by its customers. In fact, in that same email I was distraught to learn that those who have earned 35K status for 2023 will no longer have access to domestic lounges as an organic part of their benefits. Guess what is replacing this lost privilege? 35K members will be given more e-upgrade credits, which we have established are nearly impossible to use if you have status below 50K, and two (possibly useless) complimentary lounge passes. At least 35K members will now be given priority baggage handling – those little red tags cost the airline very little, but do make a difference.
Why I fly on Air Canada and what might change my behaviour
Air Canada is not my first choice of airlines because the service is any better (or worse) than the other Canadian carriers. I invested in and committed to Air Canada decades ago because it offers the most flights out of my home city.
Whenever possible I fly on Air Canada because my loyalty will earn me a little extra comfort and access. There have been times when there was a more convenient route or less expensive flight on another carrier, but I chose Air Canada because of the loyalty program and its benefits. Aeroplan and Air Canada have been successful in earning my loyalty. I am keeping my end of the bargain in the loyal program covenant.
Special message to Air Canada: here is how not to win customer loyalty
Air Canada's Aeroplan Elite program is not keeping its end of the deal. Is it too much to ask that the benefits promised are something members can actually use? Here are a few tips for our friends at Air Canada:
Don’t offer an upgrade that is unavailable
Don't promise lounge access that cannot be passed onto a friend or used by the member
Don't offer rewards travel that costs the same as purchasing a ticket in addition to the points debit
Don’t replace a benefit that customers have been enjoying with one that they cannot use
My expectations are low: I do not expect outstanding service on Air Canada, but I would like to have all the benefits – that I have paid for – and in a modest way make travel more tolerable for the frequent flyer. Promising benefits that are not accessible could, in due course, cause members to consider their options which include other airlines, alternative routing, and premium credit cards that offer airline agnostic travel benefits.