How Air Miles plans to win loyalty » strategy

How Air Miles plans to win loyalty

The LoyaltyOne company joins other players that have expanded or formed new programs in recent months.
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The loyalty landscape continues to evolve with the announcement of several new programs and partnerships in recent months.

In February, Loblaw Companies merged its popular PC Plus and Shoppers Optimum loyalty programs, and Subway announced it was relaunching Subway MyWay Rewards in an attempt to reverse declining sales. In March, Esso said it would leave Aimia’s Aeroplan at the end of May in order to join the newly formed PC Optimum. Keurig Canada also joined the fray, having launched Keurig Perks, a new online loyalty program, last week.

And now, adding to the mix of loyalty program news, AirMiles is expanding its program to include more rewards requiring less than 1,000 miles, such as discounts on movie tickets. It has also made it easier to use Air Miles Cash in-store towards purchases such as gas, groceries and drug store items. Through Air Miles Perks, it also now offers a number of “show our card” benefits — rewarding customers for simply being members — incentives that include 25% off regular season hockey game tickets and up to 45% off Park’N Fly at the airport.

The strategy, for the LoyaltyOne company, is to broaden the definition of what it means to be a collector, adopting the mindset that its program shouldn’t only be about collecting and using miles. As collectors look increasingly for smaller, more frequent rewards, “part of the focus that we have is around expanding what being rewarded means,” says Rachel MacQueen, the company’s VP of marketing.

A recent study by Leger Research found that Canadians prefer small rewards over the possibility of big ticket items, such as travel. It’s something Air Miles has taken into consideration as it looks at the future of its loyalty offering, says MacQueen.

But as the company works to meet consumer needs that are always evolving, MacQueen says it has become increasingly important to ensure Air Miles is as relevant and simple as possible, especially in the context of recent debates over data use and privacy.

As a coalition loyalty player, data has become critical to the company’s ability to create value for its more than 200 brand partners across the country — and that value, in turn, benefits Air Miles by helping its partners deliver better customer experiences.

“Consumers understand that data is being captured, but what they expect is reciprocity,” MacQueen says. “The company that is collecting information should be using it in a way that drives meaningful value in exchange for that consumer.”