The long-awaited revamp of Aeroplan is finally here.
Back in 2017 when Canada’s largest airline announced it would be spinning out of the then-separately-owned Aeroplan loyalty program and intent to launch their own in June 2020, millions of Canadians worried about the security and value of their miles collected from hundreds of flight hours and thousands of dollars in credit card spend.
With much negotiation in a public on-again off-again deal, Air Canada alongside TD, CIBC, and Visa Canada secured the acquisition of Aeroplan from Aimia to once again bring the loyalty program and airline back under one roof. Air Canada promised travellers that points would transfer one-to-one into the new program, and today Canadians are getting a first look into what the revamped Aeroplan will look like when it officially launches Nov. 8, 2020.
- What people were worried about
- Aeroplan, or a whole new name?
- What’s going to be different?
- Do I get more or less value?
What people were worried about
With the reported aggregate purchase price for the acquisition of $450 million in cash and approximately $47 million in cash for pre-closing adjustments, this deal wasn’t cheap. Members were rightfully worried about the devaluation of their hard-earned miles, flexibility of earn and redemptions, significant change in reward charts, and shifts to revenue-based earn as opposed to the present-day distance-based system. Air Canada assured miles would transfer one-to-one, but very little was said about reward charts, redemption rates, and credit card partnerships.
Before the present-day acquisition, Aeroplan members were concerned they’d be left with hundreds of thousands of miles that couldn’t be redeemed easily on a national carrier. There were discussions of Aeroplan-backed partnerships with the likes of Flair Airlines, Porter Airlines, among others, but none that would be the equivalent to the network of Air Canada. With Aeroplan being back under Air Canada, those partnerships are no longer, but is rather backed by the strength of the Star Alliance network.
Additionally, many Canadians racked up thousands of miles through pure credit card spend. Aeroplan recognizes their loyalty members through the Distinction program, while Air Canada has the Altitude program for frequent flyers—two separate programs for two valid uses. With the programs coming together, it’s critical that it’s done right and recognizes both types of loyal members.
To keep or not to keep the Aeroplan name?
There was a lot of talk as to whether to launch a new brand or stick with the Aeroplan name. At the end of the day, Air Canada felt there was brand equity in Aeroplan and that it would be a great opportunity to build a new chapter for the program under the airline rather than transitioning to a new name.
The airline said they consulted over 36,000 customers, 147 hours of interviews, and analyzed over 38 competitive programs, and the new Aeroplan will build on trust, make rewards rewarding, and recognize loyalty no matter how customers engage with the program whether it’s through travel or daily spend.
I would go as far as to say the old almost stops at the word Aeroplan. With a fresh logo featuring Air Canada’s signature rondelle, clean font featuring a creative letter ‘E’ comprised of the mask inspired by the facial markings of birds indigenous to Canada in the airline’s new livery, the revamped Aeroplan is built on an all-new tech stack, centred entirely around a digital experience, enabling personalization, flexibility, choice, but most important practicality.
Whether it’s for the business traveller who logs thousands of miles in flight or leisure traveller looking to delight their family with upgrades to their favourite vacation destination, the airline hopes Aeroplan will be the Swiss Army knife that can capture loyalty, simplify redemptions, and do it all in an intuitive manner. The airline wants Aeroplan to help sell the certainty for the aspiration of travel—a synergy it thinks Air Canada is prepared for with major upgrades to fleet, mobile app, and backend systems with the launch of Amadeus Altéa in 2019.
What’s going to be different?
Aeroplan wants to be different from other airline loyalty programs. Rather than keep customers collecting miles for a dream vacation that is near unattainable, Air Canada says it wants to focus on the fast, everydayness of the program. Through better value transparency, increased flexibility on how members can spend their points, and accessibility for premium experiences through credit cards and/or being a frequent flyer, members will be able to redeem for more, often. Redeeming for a reward shouldn’t be like a trip to the dentist. Miles will transfer one-to-one from Aeroplan Miles to Aeroplan points.
Do I get more or less value?
- No more cash surcharges on reward redemptions
The carrier is removing cash surcharges on reward redemptions on Air Canada. This will significantly reduce the fee added on top of the points redemptions when booking a flight with Aeroplan. This makes redeeming much more attractive, combined with the added ability to redeem for virtually any seat on an Air Canada flight. The result is increased accessibility and added value by reduced surcharges when redeeming for a reward.
- Improved access to partner airlines
Now, passengers have improved access to partner airlines with better integration with the Star Alliance network and other partners added recently including Azul and Etihad. On partner redemptions, Aeroplan will now charge a flat $39 fee—a pretty fair trade off for improved access to partner airlines. It’s also important to note that all rewards will now be eUpgrade eligible.
- Points + Cash
Don’t have enough points to redeem for a reward? Aeroplan is taking a page out of SPG’s book and launching the Points + Cash feature—the ability to redeem rewards for a combination of points with cash. Options of combinations will be made available to users to make the choice that enables better flexibility—ideal for when you might want to bank points for a future, more valuable redemption.
- Peak pricing
With Aeroplan previously being a fixed-award chart, the new program will introduce peak pricing for flights within North America and between North American and outside regions operated by Air Canada. On a traditional economy class fare, what could have been 15,000 Miles round trip (+taxes and fees) would fall into the 6,000-10,000 point range, per direction, meaning it could cost 12,000-20,000 round trip (+taxes and reduced surcharges) in the new charts. Variables would include flight capacity, demand and times, and passengers can see price jumps on high-demand flights while seeing potential savings on earlier flights or low-demand periods. Partner flights remain on a fixed chart, as will flights within regions outside of North America.
- Revenue-based earn coming next year
Next year, Air Canada will be transitioning to revenue-based earn, officially moving away from distance-based earn currently present on Aeroplan Miles. Economy Basic fares will become eligible to earn Aeroplan points, while they are ineligible towards Status Qualifying Miles (SQMs) and Status Qualifying Dollars (SQDs). Simpler calculation of points means greater transparency with Basic fares earning 2x base fares (pretax and fees), and all fares above earning 3x. Additionally, members with status earn additional multipliers, with 25/35K, 50K, 75K, and Super Elite earning +1x, +2x, +3x, and +4x, respectively. In some cases, especially with sale fares, earn rates may see a decrease in the new revenue-based earn calculations compared to what’s currently in place.
- Some features could devalue your points
The revamped Aeroplan will come with new ways to use your points from upgrades, to Wi-Fi, paying for seat fees to access to the Maple Leaf Lounge, covering baggage fees through food on board to name a few. These are strategic on an airline’s part but won’t be worth as much as saving up to redeem on a proper flight which is much higher in value. This gives passengers flexibility to access more comfortable features on a flight, but your best bet remains to save points for travel redemptions.