In the wake of Air Canada’s recent announcement that it will launch its own loyalty program in 2020, ending its commercial agreement with Aimia−which operates Aeroplan, Canada’s premier coalition loyalty program−Rob Daniel, executive vice president, Bond Brand Loyalty, told Loyalty360 Aeroplan officials need to make sure they are more aligned with the drivers of consumer choice.

The Aeroplan program was created in July 1984 by Air Canada as an incentive program for its frequent flyer customers. 

Effective June 30, 2020, Aeroplan will no longer be the loyalty program for Air Canada. Aeroplan has been independently owned and operated by Aimia for almost a decade. By operating its own loyalty program, Air Canada officials believe they will be better able to strengthen their customer relationships and deliver a more consistent end-to-end customer experience.

Loyalty360 posed a few questions to Daniel about the potential impact of this announcement.

Can you talk about the domino effect Air Canada's announcement might have on Aeroplan and other loyalty program operators affiliated with Aeroplan?
Daniel: Coalitions have eroded not only overall member satisfaction but also trust, which is a top anti-driver of satisfaction in loyalty. In the past few years, changes in rules associated with the currency (like points expiry), not living up to the value proposition through challenging redemption experiences, and shifts in consumer expectations have all impacted the success of these programs. We have already seen one partner announce that it is not renewing with Aeroplan and, if the program does not evolve and adapt to be more aligned with the drivers of consumer choice, we would expect program operators affiliated with Aeroplan to demand change or consider alternative program options.

Let’s not forget that loyalty is tremendously effective. Consumers overwhelmingly declare that it influences their choices, share of wallet, and brands they love.

Was this announcement by Air Canada a surprise?
Daniel: As a leading professional services agency in the loyalty space, Bond is obviously watching this story closely. We’re surprised by the timing, but not the change that has been announced as coalition providers like Aeroplan are often too heavily focused on the currency (T&Cs, breakage, and expiry) instead of focusing more attention on the needs and joy of their members.

Programs and operators are under significant pressure to deliver deeper member engagement and Air Canada is doing the right thing to create a more brand aligned end-to-end customer experience that builds loyalty to its own brand instead of the Aeroplan brand. What we saw this week is one of Canada’s most important brands choosing to be closer to its program and the customers who have raised their hands to be part of it.  

How can Aeroplan and its affiliates react positively to this?
Daniel:  While coalitions were very valuable in their day for rewarding transactions, today’s consumers are looking for more authentic connections and personalized shared experiences with the brands they choose. And brands are looking for richer proprietary data and tools to help meet those expectations. Aeroplan members also now have added concerns and will be looking for reassurances and possibly alternatives.

What we know from our research data on consumers in loyalty is that the top drivers of program success include program meeting needs, enjoy participating in the program, appealing benefits, and time to earn desired rewards. Aeroplan and its affiliated partners looking to assert themselves as the program of choice for consumers would do well to amplify elements of their program associated with these drivers to ensure they deliver on current and future member demands and expectations.

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