Air Miles announced a big change to its loyalty program this week. It comes on the heels of customer outcry that the program was unfairly blocking members from accessing certain rewards.
So Air Miles says it has “simplified” its formula for how it doles out reward choices. Now members who collect more miles in the year get to choose from a bigger selection of flights and merchandise.
The change brings Air Miles more in line with some other loyalty programs that offer extra perks to users who pile up more points.
However, the customer outcry continues.
“I don’t believe it,” said Air Miles collector Katherine McLaughlin of Oakville, Ont. “They haven’t been forthright and transparent in what they are doing and then they gave so many excuses to different people at different times.”
“Fool me once, fool me no more,” a reader commented on a CBC News story about the new rules.
For months, Air Miles’ owner, Toronto-based LoyaltyOne, provided different explanations for how it tailored rewards — from basing it on personal preferences to basing it on a collector’s activity levels to showing customers varied products to see which ones “resonate.”
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And this has some customers and industry analysts still questioning what precisely is going on behind the scenes.
“It’s like a teenager who has nine reasons why they’re home late,” said Lindsay Meredith, a marketing professor at Simon Fraser University in B.C.
“Now your consumers don’t know what the heck the truth is.”
In July, CBC News first reported that some Air Miles members were blocked from various rewards.
We had received many complaints from collectors who claimed they found premium merchandise when searching online for items using a membership with few miles.
But they said when they logged on to the website using an account with enough miles to claim the items, the same premium products had vanished.
At the time, Air Miles said the products people could access was based on an individual collector’s personal preferences and activity level in the program.
It was explained to us that more active collectors had access to a variety of items so that they were “seeing new things and it’s not the same product or reward at all times.”
Collector McLaughlin got an additional explanation when she contacted Air Miles on Aug. 30. She was trying to find out why she couldn’t get a Bose Wave music system she’d seen advertised on the website. She had the 6,900 miles to claim it.
She shared with CBC her online chat with an Air Miles customer service representative.
The rep told her rewards are personalized, and that sometimes rewards also vary because the program is testing out merchandise: “From time to time, we offer a different product selection to different collectors to see which products resonate the best.”
“You must be joking,” responded McLaughlin, who didn’t believe either explanation.
A week and half later, CBC News contacted Air Miles again, asking for more details about rewards access.
This time, we got yet another explanation. Air Miles said rewards selection is based on how actively a member collects miles and redeems them for rewards.
The system also factors in what tier or level members are in: blue, gold or elite level onyx.
The more points you pile up in a year, the higher your tier.
“We reward collectors who are more engaged in the program,” spokeswoman Kahina Haffad said in an email.
This time round, Air Miles was adamant that the products people see have nothing to do with personal preferences.
Then, on Sept. 27, the Globe and Mail published an article in which LoyaltyOne CEO Bryan Pearson said rewards are tailored according to people’s preferences.
So CBC News asked Air Miles again for clarification. Spokeswoman Natasha Lasiuk said rewards access used to be based on personal preferences like shopping habits.
She explained that because customers were “confused” by this system, rewards selection is now based solely on a member’s tier within the program: blue, gold or onyx.
The higher your tier, the more rewards you get to choose from. That’s it.
Lasiuk said the change happened at the end of the summer. She provided no specific date.
She also said that over the past 12 months, new collectors saw premium merchandise that was out of their reach to encourage them to collect more miles.
Will customers stay loyal?
The tier system is clearly laid out on the website, so one presumes Air Miles is being upfront about the new regime.
But the question remains: why did the program have so many explanations in the past for why people had different access to rewards?
Professor Meredith suggests perhaps LoyaltyOne was avoiding discussing a less palatable goal: to make it harder for customers to cash in all their miles set to expire in January with the new five-year expiry rule.
“If their underlying motive was indeed a backroom discussion about, ‘Let’s figure out a way to grab a bunch of these points back if we can,’ they’re sure as hell not going to release that one publicly.”
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CBC News asked Air Miles if it had been trying to complicate the redemption process by hiding rewards from certain collectors.
Lasiuk replied in an email that the program offers a bigger rewards selection than ever before “and collectors are definitely taking advantage.”
She also told CBC News that Air Miles has made its “rewards selection straight-forward for collectors.”
But precisely how it offered rewards previously remains unclear. And that’s sure to inspire some members to question their allegiance to the loyalty program, Meredith says.
“They’re going to have trouble, mark my words, downstream, peddling Air Miles.”