Audio Transcript

#194: Air Canada’s Award-Winning Aeroplan Program (40m)

00:00:04 Paula Thomas

Welcome to Let’s Talk Loyalty, an industry podcast for loyalty marketing professionals. I’m your host Paula Thomas, and if you work in loyalty marketing, join me every week to learn the latest ideas from loyalty specialists around the world.

This show is brought to you by the Loyalty and Awards Conference the leading annual event for loyalty professionals in the travel industry. Be sure to join us this year from the 10th to the 12th of October in Madrid for the perfect mix of inspiring content and exciting awards. Check out loyaltyandawards.com For more information and to register.

00:00:56 Paula Thomas

So Derek Whitworth joining me today from a snowy Toronto. Welcome to Let’s Talk Loyalty.

00:01:02 Derek Whitworth

It’s a pleasure to be here.

00:01:03 Paula Thomas

Great grace and for the audience I will say Derek, that you and I met in a sunny Dubai, which probably…feels like a….

00:01:12 Derek Whitworth

Million years ago now.

00:01:14 Paula Thomas

Even for me I have to say Derek. So it was, you know, back in October at the Loyalty Awards conference. So we had a wonderful time. You won a fantastic award, which hopefully we’ll talk about today. And but before we get into our conversation, Derek, please do tell me what is your favorite loyalty program?

00:01:32 Derek Whitworth

So I had to think about a lot of different loyalty programs, but I thought I would talk about the one that I use the most at. Which in Canada is? I believe, one of Canada’s largest, if not the largest program, is PC optimum. It’s a retail program and listen, they just do an amazing job with kind of getting you on the wheel, keeping an eye on the offers Getting you to earn getting you to burn. It’s a it’s just a really great program. And frankly I think they’ve done a lot of things right that that we’re thinking about in terms of how we keep Members actively engaged with Aeroplan Day in and day out.

00:02:03 Paula Thomas

Yeah, absolutely well Aeroplan has to be one of the most iconic loyalty programs in the world, dare I say. And I was even looking back on the history that you sent me. Couldn’t believe it dates back to 1984. So you have 38 years of history that you have responsibility for, and it certainly hasn’t been a quiet time of these last few years, so I suppose we should start by saying you know. What are you doing right now? Where has Aeroplan been? I suppose on its journey over the last. Three or four years.

00:02:39 Derek Whitworth

So we embarked on a transformation with Air Canada’s loyalty strategy back and going to say probably back in 2014 or 2015. And things really kind of heated up in 2017 when we announced a big move which was to exit our partnership with, with Aeroplan, Aeroplan had been spun out of Air Canada back in about 2004 2005. And we were dealing with Aimia at an arms length to actually operate the Aeroplan program and you know we finally came to the conclusion that there were enough challenges for us from an airline perspective to actually operate the loyalty program that way that we said we really need to bring it back in House and that’s. You know, for reasons like doing a better job of controlling the customer experience, providing consistency to deliver better economic value to our customers. But you know more broadly to other stakeholders that we have, and you know, really, thinking more about how.

00:03:28 Derek Whitworth

Does the loyalty? Program fit into the broader airline strategy. You know, we’ve seen it in many different areas of the airline. Whether it’s with our airline partnerships around the world Build whether it’s our distribution strategies. Loyalty plays a really critical role in all of that, and we wanted to have you know control of our own destiny. To be honest.

00:03:47 Paula Thomas

Yeah and it was super high profile Derek and I suppose a lot of consumers were initially, I suppose, very concerned and. And I think, as you explained to me, there was essentially a perceived end date where when it was announced it was going to be spun out. It was such an already loved brand that consumers were like what are you doing with our program. All of that uncertainty is probably as a marketeer which clearly you are at heart. It’s very difficult to manage, so it all played out very publicly for you.

00:04:19 Derek Whitworth

It did and that that was what was maybe most interesting about this versus other, you know, kind of corporate transactions that take place over the course of time. Like this is Something that that was going to hit Canadians and consumers.

00:04:32 Derek Whitworth

You know, in some cases around the world. You know directly in terms of how they engage with Air Canada and Aeroplan Day in and day out so you know I think we probably spent months thinking about what is our communication strategy to be able to speak about this, and, you know, provide a sense of reassurance that Air Canada was going to be doing the right thing for all of its customers. Whether Aeroplan members are not to make sure that they were ready to participate in whatever our future loyalty program was going to look like, so you know there was a lot of thinking that went into that. A lot of it was kind of based on what we had seen in the Canadian marketplace. Some other loyalty programs had made some changes that you know, frankly, were front page news, so we wanted to make sure that we could manage and control the narrative as much as we possibly could. But again, always thinking about how do we communicate and you know, set expectations with consumers in such a way that hopefully they’re going to feel confident that we are doing this for them and that they will come out on the other side. With you know an even better program to engage with.

00:05:35 Paula Thomas

And when you say front page news for other programs, that doesn’t sound like it was the right kind of front page news.

00:05:41 Derek Whitworth

Unfortunately not, you know there there’s a lot that’s gone on, especially in the space of you know points or miles expiration. That’s something that Canadians are very focused on with a lot of well loved loyalty programs. Canada has many coalition loyalty programs and therefore there’s a lot of engagement, a lot of attention on what’s going On in the loyalty Base as a result, so exactly because there was this change of strategy with one of our competitors that led to lead to a lot of attention from a lot of people.

00:06:10 Paula Thomas

So then when you decided you’re bringing it back in. House Air Canada loves its customers, loves Aeroplan. I mean that Was a huge Decision and what I really loved Eric as well as you, decided to completely reimagine it. So it wasn’t just a case of, you know, the ownership is changing and the program stays the same. It’s this is our opportunity to essentially get a blank sheet Paper and start all over and with an incredible legacy. Still take best of breed thinking and create something very new. So tell us a bit about what you’re proud of Derek, of all of the things you’ve done, I have a load of things you’ve told me about.

00:06:49 Paula Thomas

And that I want to pick up on. But I’ll certainly talk about specifically in terms of the insights, but tell me, just like, what are you proud of that Aeroplan now early in 2022 has delivered in this digital transformation?

00:07:03 Derek Whitworth

I think the thing I’m perhaps most proud of is you know you. You mentioned the fact that that Aeroplan was reacquired by Air Canada and you know We’re in the midst of this You know enormous transformation We’re thinking about how we’re going to build this new program We’re thinking about the technology and everything that goes along with it But I think the thing that I’m most proud of is When we brought Aeroplan back in house how we all kind of came together and built one team to actually deliver on a completely transformed Aeroplan program and what I mean is you know the legacy or Canada team that was focused on the launch of the new program but then bringing in all of this expertise and experience and knowledge from the Aeroplan side.

00:07:43 Derek Whitworth

And you know, looking at it both from an airline perspective, but also from a loyalty program perspective and Kind of taking all of Those insights to actually Build something even better than I think what any of us you know on your Canada side very early on had in mind So I think more than anything like so many transformations, it really is about the people and that is what I’m proud of.

00:08:04 Derek Whitworth

Is that we’ve really managed to build a good team That is a great team To be honest that you know has delivered something amazing and is continuing to collaborate in such a way. That I think We’re just continuing to evolve. The Aeroplan business to new heights And from the background stuff that you sent me, Derek, I think what’s impressive, you know, looking from the outside.

00:08:25 Paula Thomas

In there is the combination of and I suppose loyalty consulting firms so you know, for example, I think you’ve got five different consulting firms to verify the landscape you know, bring different perspectives, and that’s obviously a very strategic and very comprehensive view that, to be honest, not Everyone can afford or would even go to that level. So that’s an extraordinary amount of investment.

00:08:51 Paula Thomas

I also know that you spoke to I think the number Was over 3,600 consumers, which was an extraordinary number. So to get the feedback as to actually what customers were saying and when you talk about the front page news as context, you know, I think when Members feel heard, there’s a whole different opportunity To bring together, yes. What the consulting guys might say. Your loyalty technology partners might say, but also with what your consumers are saying. I think that’s amazing.

00:09:21 Derek Whitworth

Well I will say on the front of some of the consulting partners and agencies that we worked with. It was a pretty exciting project within Canada, so I think for a lot of them they were like, Yep, we’re willing to you know Co. Invest a little Bit here.

00:09:35 Paula Thomas

Totally, oh nice, yeah.

00:09:35 Derek Whitworth

To be involved but. But you know to Your point, the number of stakeholders involved in this. And the you Know the number of voices that are involved to get it. Right, it’s tough to kind of see the forest through the trees in those situations, but I think from the get go we really did want to put the Member first and a lot of our decisions. It doesn’t mean that we didn’t have to answer to our finance teams and other genes internally, ’cause we certainly did, but I think doing right by our Members was.

00:09:58 Paula Thomas

Of course.

00:10:04 Derek Whitworth

It was always kind of job. Number one especially going into a situation where we were potentially, you know, going to be looking at them and saying, yeah, your points are coming into the new program. Obviously we had a good news story for them eventually on that front, once we reacquired Aeroplan, but you know if we didn’t if we didn’t get ourselves off on the right foot with our Members. You know what the heck Are we doing this for?

00:10:26 Paula Thomas

You’re totally right, actually, because it’s, it’s almost the opportunity for disloyalty or just to breed total. You know, confusion, actually sometimes, and so to get past that, to have all of the messaging totally brought in. And then things which I think are very practical. Derek and you can obviously talk through it a lot better than I can, but you know, simple headlines, like you know, every seat that’s available for sale is available for points like the clarity, the accessibility, like that itself was probably quite a difficult commercial decision Make, would you say?

00:11:01 Derek Whitworth

Well, so you know to be Honest Aeroplan prior to the acquisition had a had a similar concept. You know Aeroplan members could get access to almost every seat on Air Canada but frankly it was the under underlying economics that were challenging that more than anything else. So I think you know to your point We finally got to. A place where we could truly say Any seat, any flight you’ve got it on points, but you know the real challenge in all of that was the You know the pricing.

00:11:30 Derek Whitworth

The technology underpinning it to make sure that we could deliver on that commitment and frankly deliver on it in such a way that you know we’re not charging a member an extraordinary amount of points whenever they want to fly, so you know it, it really does come down to what we had to build underneath to be able to make these claims.

00:11:48 Paula Thomas

Yeah, and I’ve often said on the show Derek that the guys in revenue management in airlines are always the ones that actually I admire. And I just The level of complexity that comes on that side of the business, which clearly is exactly what you had to manage for loyalty. Exactly the same things you said you’ve got to give value. And competing, you know opinions and ideas, so to pull that off, I just think it’s fantastic.

00:12:14 Derek Whitworth

Yeah, and you know I will say as you were saying that about revenue management teams. I should say for people who are listening, I am nodding because I think we have probably one of the best revenue management teams in the business that are Canada, you know. Two things were were. Lucky to be supported by a head of commercial who actually started her career in Aeroplan. So she knows the Value of loyalty. There’s no you Know debate or discussion about that.

00:12:39 Derek Whitworth

But I’d also say you know LRM teams They was unsatisfied with the legacy Aeroplan constructs as we were on the loyalty side So you know It was great because We kind of were coming at it from the same perspective You know, obviously maybe with slightly different financial objectives to balance out, but I would say Even through to today Hey, you know the conversations that we are having Our are extremely productive and I think a large part of that is because of what we actually built together such that you know the way that we’re pricing in the way that we’re forecasting and modeling. It’s not just taking a loyalty program view, it’s taking a loyalty program and an RM view for kind of enterprise value as well as value back.

00:13:20 Paula Thomas

Yeah, and Ourem is revenue management then for the non airline people who are listening yes.

00:13:26 Derek Whitworth

That’s right, yeah, exactly.

00:13:28 Paula Thomas

You know, when I worked in British Airways originally Derek, I used to say this actually feels like a different line Which, like the level of jargon acronyms and you know that was before I got into loyalty But you know, just to figure out how to talk airline speak so.

00:13:44 Derek Whitworth

I ask you, you’ve got to learn the airport codes you’ve got All the all, the all the TLA’s the three letter acronyms is as we call. Totally yes. On airports. My favorite was always at Dublin DUB obviously where I’m from and DXB, which is obviously DUB Dubai and I was always like which one is.

00:14:04 Derek Whitworth

Where am I going?

Am I going?

Home but where is home?

00:14:05 Paula Thomas

Oh my God. Or going to the Middle East exactly. Totally cool and then I suppose on the more innovative side Derek. Uhm, I saw something in one of your slides. About an idea where Members can, for example, bid for upgrades at check in, and I thought that was a gorgeous concept. I have a friend who’s traveling literally this. Week, and I think it might be the first time with she’s actually traveling with Emirates out of Dubai, but it’s the first time I think she’s upgraded, so it’s a fabulous experience, obviously. To do that, but obviously you don’t always have enough points in any loyalty program to upgrade, so it sounds like you’ve found a solution and You know to give People the maximum chance to get an upgrade if they have some points compared to maybe whoever else is traveling on the same flight. Am I understanding that correct?

00:14:54 Derek Whitworth

Yeah, you know, it’s interesting because Aeroplan, unlike you know basically every other loyalty program in the world do not have a robust upgrade program. So upgrade with your points.

00:15:05 Paula Thomas

OK, which you know.

00:15:06 Derek Whitworth

We were very much behind the 8 ball on that but the reality is the economic considerations between Air Canada and Aeroplan made that quite challenging. So you know when we were setting out to, you know, we launched the program We kind of said, OK, do we want to move in the direction of something like what programs? Have done where they kind Of set a value of points that are required. But maybe you’re going to have to pay a certain amount of cash. Gosh, and we said no, that’s not the direction that the industry is going, and so you know we have a great partner in plus grade. Another Canadian based technology firm that works with many airlines around the world and we kind of reimagined our upgrade product with points based on that and effectively to your point, allowing people to kind of say.

00:15:48 Derek Whitworth

You know, maybe for this trip I’m willing to pay a little bit more in points because I really want. The upgrade, as opposed to, and I’ve you know I can tell you I have friends who have certainly done this where they’ve said, yeah, I don’t care that much about the upgrade on this trip, but I’m happy to put it a bit. And if I get it, I get it and I’m happy, but I’m not going to pay as much as I would perhaps otherwise. So yeah, this is this is definitely a place where I think we maybe broke a bit of the frequent flyer program paradigm with upgrades.

00:16:13 Derek Whitworth

And our customers have been taking advantage of it and have been really positive about it, which is great. Oh cool, because I do worry with something like that, but again, you know I’m like this is what I think this means.

00:16:24 Paula Thoms

But when you are breaking a paradigm, you probably have that extra communication channel. To make sure that people kind of get it and go OK, yeah it works or I understand how to try this out. So was it Challenging, would you say Or do people kind of go Oh that’s super cool Yeah, just give it a go.

00:16:41 Derek Whitworth

Well, so you Know the interesting consideration in so much of this is we launched a lot of these products in the midst of the Pandemic we actually Introduced the bid for upgrade with points. I want to say sometime, maybe in spring of 2020 it Had always been on a Road map to launch it a couple of months ahead of the relaunch of Aeroplan. Yeah, so you know it’s One of those things where I, I think we’re all kind of watching to see OK as pasture Volumes creep back up. Are we getting different types of feedback because people are now interacting with this for the first time? Because they haven’t been traveling over the past two years, but so far we haven’t seen that.

00:17:15 Derek Whitworth

We’ve just seen more people wanting to take advantage of it, so, but you know, back to that point, it is something that we are very cognizant of yeah, we’ve launched a Lot of this in a period where very few people are traveling, do we have to make some adjustments because you know, now people are suddenly traveling again and maybe there are things that we didn’t take into account, especially when we were designing certain things Maybe in a pre pandemic context.

00:17:37 Paula Thomas

Of course, yeah And again, I don’t think any of us expected, you know at any point. Maybe we still don’t, that it’s gonna, you know, continue this pandemic, you know, feels like the longest thing and we’ve any of us have ever been through. But certainly the airline industry Like I, I feel you know, most you know I suppose just empathy for in terms of, you know whether it is a snowstorm. Again, my friend who’s traveling has a 5G issue causing cancellation of her flight today.

00:18:04 Derek Whitworth

Got it, Yep.

00:18:05 Paula Thomas

I mean honestly, you know the operational challenges are just unbelievable, and that’s before you get into communicating. This is our program This is how much we love you and Gonna make it. It is, it is.

00:18:17 Derek Whitworth

Not an industry for the faint of heart. I you know, to your point, it’s funny, you know, I we, we were talking about exiting Aeroplan back in 2017 and we said well in June of 2020 will no longer be participating at Aeroplan and sometimes I go. Can you imagine if that’s what we were dealing with in the midst of the pandemic, If we hadn’t reacquired and yeah But you know to Your point, we’ve dealt with the 737 Max over the past couple of months. You know, obviously all of the implications around the pandemic, but Yeah, to your point, it’s like if you want to get into this, you should be prepared that what you think is going to happen by the end of the year is going to be wildly different than what winds up happening at the end of the year.

00:18:57 Paula Thomas

But I think What I hear from you like me is that it’s utterly exhilarating, like the whole industry I missed the airline business. My goodness I’m super envious You can probably tell right now.

00:19:11 Derek Whitworth

Yeah, it’s I mean to your point, it’s not, it’s Not without the Days where you go. Oh my goodness What the heck are we doing? But it’s yeah It’s just you’re always faced with kind of new challenges. And then you know, thinking about how you actually can engage customers through it all I, I think that’s what keeps a lot of us going.

00:19:28 Paula Thomas

Yeah, and I think just as it’s you know, essence in terms of simplicity. Just travel alone is super inspiring so anything we can do to facilitate that. Actually, you know, in whatever form, so I do think that probably comes back to it all. And obviously a beautiful country like Canada, which by the way I have not yet been to. So please, you know.

00:19:47 Derek Whitworth

It’s time, it’s time.

00:19:49 Paula Thomas

I was gonna say I was gonna say yeah.

00:19:51 Derek Whitworth

And frequent non stops from Air Canada from Dubai back to Toronto, so you know we’d love to see it.

00:19:56 Paula Thomas

Oh my goodness, you know any excuse Derek I will hop on a plane, I promise. And the other part which I loved as well in terms of your new proposition And this actually was quite amusing when we talked together before Derek was the whole piece around You know whether or not you should have to pay taxes When you know you’re getting your redemption flight, you know you’ve been saving You’ve been monitoring, you know. Obviously, it’s a big deal That moment of truth and you had some surprising feedback. I thought from a couple of people in terms of their perception of paying the taxes on a redemption flight. So I’d love if you’d share that with the audience ’cause I thought it was very insightful.

00:20:36 Derek Whitworth

Yeah, absolutely And you know, I’ll say upfront this this is the type of thing that really came out of deep In person research that we did with, you know, dozens of consumers You know one of our hypotheses going into the redesign of Aeroplan was we were expecting consumers to say yeah, we, we don’t like paying taxes. We’d rather just pay everything in points and you know we don’t want to take our credit Card when we pay for rewards. So this notion of Totally free rewards was something we thought was going to be very import. But there were some things that actually fell out of those conversations.

00:21:11 Derek Whitworth

One of the things was consumers said, look, I, I don’t like it when you put a fuel surcharge or a carrier surcharge on our reward, which we knew and we took that to heart and the redesign of the program But you know? Consumers in Canada said listen, we live in Canada We know that. We have to pay taxes. We accept the fact that we’re gonna have to pay taxes on rewards. That’s not Air Canada is doing.

00:21:31 Derek Whitworth

You know that’s not any airlines doing. That’s the government doing, but the piece of feedback that we thought was most interesting, which I think maybe you’re talking about is. A number of people said to us, well, actually we really like paying a little bit of cash on our credit card, ’cause it immediately makes the purchase eligible for travel insurance, which we thought was just such an insightful comment from a from a consumer was like, yeah, that that makes sense.

00:21:56 Derek Whitworth

By putting this value onto your credit card, now all of a sudden this trip is going to be eligible for. The travel insurance benefit on your on your cobrand cards. So you know it was It was little insights like that that really became important in terms of informing the final design of the program, but I will say we did met out in a place where we are certainly giving customers the option to say I want to pay for the reward fully in points.

00:22:18 Derek Whitworth

That option is. Available, but you know it told us that shouldn’t be The only option available. This is a Place where optionality is a good thing.

00:22:26 Paula Thomas

Yeah, it’s extraordinary, and I think a credit to you guys that you have such highly engaged members that again sometimes know our programs better than we do.

00:22:36 Derek Whitworth

For sure for absolutely Yep indeed.

00:22:41 Paula Thomas

There was another lovely point as well that you made Derek, which I think probably has to top my favorite statistic Of the year And it was just in the deck that you sent me. So you know, I’ll just share it for the audience. And you know, I was always asking people about their favorite loyalty statistic. But the one about Aeroplan that really I thought was beautiful was 90% of the people that you did this qualitative research with knew their Aeroplan number by heart.

00:23:09 Derek Whitworth

Yeah, it’s It’s amazing the number of people who are just that passionate about the Aeroplan program Now obviously we’re not expecting everyone in Canada to know About to be able to Kind of say it say it But no for many People, it is clear that the Aeroplan program is a is a really important part of their day to day life and for some of these people it is part of their day to day life just because they’re getting on a plane that often. So no, it was It was fascinating to see the number of people who actually have it committed to memory.

00:23:40 Paula Thomas

My God, yeah, I mean, I know my credit card Number by heart But I still have to look up Everything else my God. So yeah, I love that. And then I guess you add to that point about us both the everyday engagement. Derek, I think you’ve done a lot more in terms of partnerships and just broadening the opportunity for earning beyond the airline And I know there’s family propositions, but maybe just talk through how have you made the program more accessible. And I guess you know, maybe on both the urn and the Burnside, because I saw a nice little words which is micro redemptions, so I’d love you to talk about that part as well.

00:24:16 Derek Whitworth

Yep, absolutely. So I guess a couple of things here. You know we relaunched the program in in the fall of 2020 and I would say 2021 Was really the year of our Ownerships and our partnerships team has been has been working, you know, nonstop to implement exactly as you describe. Everyday engagement opportunities for members with the Aeroplan program.

00:24:37 Derek Whitworth

So you know enabling Members to earn when they’re getting coffee at Starbucks or when they’re taking an Uber when they’re ordering in with Uber eats, which obviously I think it’s highly relevant In the pandemic, but especially in the pandemic when it is snowing outside. Oh my God, yeah For us up here in Canada.

00:24:53 Derek Whitworth

And so you know, in a year where a lot of people didn’t have reason or didn’t feel comfortable yet flying. This was a great opportunity for us to keep Aeroplan and by Extension Air Canada top of mind for consumers. So I think we’ve been really excited to see just the volume of engagement and the Uber partnership, which allows members to link their Aeroplan profile with their Uber profile Really only launched I want to say maybe the second week of December Last year, and we’ve already seen you know, 10s of thousands of Members who have actually signed up for it without any sort of communication out to customers about it. They’re delighted to see the number of people who are logging into our digital channels and choosing to engage with this as soon as they’re seeing that it’s available to them.

00:25:38 Derek Whitworth

And then you know to your point on micro redemptions, I think this is a big area of focus for us. Heading into 2022, which is enabling members to redeem, not just for a war, but you know, maybe they want to treat themselves to an extra legroom seat or Wi-Fi on board their flights. You know, there was this notion of loyalty programs for a long time.

00:25:58 Derek Whitworth

That you can only allow someone to redeem for something that’s at least, you know, the basic. You know, 12,500 point rewards somewhere domestically, and I think a lot of airlines have kind of turned that on its head to say no, like let’s get people engaged and let’s get them earning and redeeming on a much more frequent basis because I think if there’s anything that All of us agreed to In the loyalty industry, it is the fact That as soon as you Get a member To redeem it, there’s something in their brain That is immediately going OK, I gotta get back on the hamster wheel and start Earning again so.

00:26:29 Derek Whitworth

I, I think that’s the way that we look at this notion of Micro redemptions it’s very different Then you know way the ways that loyalty programs have approached in the past. But I think as long as we make sure that these redemptions are, you know, well priced for Members and profitable for us from an airline standpoint, it’s the right thing To do overall.

00:26:49 Paula Thomas

OK, wonderful and so am I right in understanding then so your entire micro redemptions are Air Canada products, and I mean have you looked at doing those externally For example with partners? Or is that something that you’re thinking about?

00:27:05 Derek Whitworth

So we do, you know, we talk more about Mike redemptions internally as kind of Air Canada Mike redemptions, but you know, Aeroplan offers you know plethora of opportunities to redeem your points for car rentals For hotels, gift cards merchandise, you know all of the things that you would expect from a from a mobile loyalty program You know I made a redemption for a car rental for a day or two last fall and I think it came out to something like less than 5000 Aeroplan points so you know even. That’s a great example Of delivering that value back to back to customers.

00:27:37 Paula Thomas

OK, so all about flexibility and lots more options.

00:27:41 Derek Whitworth

Exactly right.

00:27:43 Paula Thomas

So here we are coming into, I suppose the middle of March Sorry, pardon me at middle of February, so you had one As I mentioned at the start of the show, a wonderful award already, which was the excellence in management which actually must have been super proud of Derek, because I don’t think you’d want anything with the Loyalty Awards guys before so this I think was your first time on the radar and you know to come up with such a wonderful award.

00:28:10 Paula Thomas

You must have been super.

00:28:12 Derek Whitworth

Well it it It I certainly was in back to my earlier comment. I mean the amount of effort that went into this across our organization Whether you know at the management ranks our frontline Teams who learned. A completely new Aeroplan program, you know I think the excellence and Management award really meant something To all of us because it reflected on the journey that we’ve been on, which he has really been about managing an enormous transformation within a You know, an equally enormous global airline.

00:28:42 Paula Thomas

Yeah, and we were actually sitting on the same dinner table that evening. Yeah, and I do remember that you’re calling your colleagues back in Canada and immediately sharing the news, which I actually even thought was an incredibly generous thing to do was to make sure that as soon as you knew they knew as well so Amazing excitement.

00:29:02 Derek Whitworth

It’s a shared reward or it’s a shared recognition So no, absolutely you know it’s. I think it’s just sad that we couldn’t all be there together but you know, we certainly we certainly took the opportunity to kind of celebrate amongst ourselves in the office with some Starbucks that we had earned some Aeroplan points on.

00:29:20 Paula Thomas

Well done, you still as we come into the rest of 2022 fabulous year ahead? I mean, I’m certainly very Excited, given that you’ve been through, let’s say, the hard part, and you’ve done, you know, complete You know, redevelopment reimagination. As we’ve said, rebuilding the program technically, we’ve done the communication, so you’re out in markets so, so what’s next Would you say then, for Aeroplan throughout this year?

00:29:47 Derek Whitworth

So I guess a couple of things you know first And foremost I Would say Air Canada as we’re you Know hopefully exiting the pandemic over the course of the next couple of months, but You know, even as things evolve. We know that self service is going to be critically important, so we see Aeroplan as a driver to increase engagement across our digital channels and to get people you know downloading our apps, self serving where they can on our website or other channels that we have available to them.

00:30:15 Derek Whitworth

So I think the notion of Aeroplan and service of Air Canada Over the course of the next year is going to be critically important. We’ve obviously seen Aeroplan as an accelerator of engagement when people aren’t flying, but as we see more people returning to the skies, we really want to use Aeroplan as that kind of cash Catalyst from a self serve perspective I will say to you know there’s a number of things that we didn’t necessarily deliver when we launched the program. And as I think you heard me speak a little bit about in Dubai, we were very strict about scope What was in scope versus what was Out of scope.

00:30:48 Derek Whitworth

Yeah, and you know I, I think we’re at a point where we’re still kind of getting some things Out the door, you know micro redemptions and enabling members to use points for things more broad than just Let’s say flight Rewards or upgrades or things like that. That is very much on our radar screen for this year and then we have a number of other things that we want to do to enable Members to more easily redeem for flight awards.

00:31:10 Derek Whitworth

To you know, maybe for more exotic types of itineraries that include stopovers You know other types of international trips and then you know even further Finally enabling our Members To change rewards online, which is something that we know that they’ve been looking for a long time. So you know All that to say I think if there’s if there’s one kind Of headline For us, it is really about the self serve. But again, it it’s about making sure that Aeroplan is doing everything it can to support Air Canada as it, you know, rebuilds out of the pandemic.

00:31:42 Paula Thomas

So, given that you’ve done such an amazing job and I love that point, Derek about being in service of the airline and clearly Aeroplan has had this, you know fantastic legacy proving its value over the years and Air Canada has had loyalty from top to bottom in terms of it’s literally in your blood But how would you say other sectors and we opened by talking about retail for example like do you think loyalty is something that’s growing in importance for all industries? Or is it something that you think airlines are just particularly focusing on given, as we said, the kind of challenges of the pandemic?

00:32:17 Derek Whitworth

I, I mean I, I think it’s across all industries right now and I think what’s amazing for all of us In the loyalty space is There’s so many interesting ideas that are applied in different market segments or in different industries that we can actually kind of learn from and bring into our own industries you Know I I’ve I’ve participated a couple of loyalty conferences and Channels and you know there’s there’s brands Big and small who are doing interesting things They’re introducing loyalty programs for the first time You know they’re they’re getting people engaged on their digital channels and and you know in in industries that you wouldn’t necessarily expect to have digital properties They’re they’re really making investments in that space, so you know I I see this As something that many different industries are really kind of taking taking to the top of their top of their C-Suite to have a conversation about to say, look at what this Is going to drive For the business, as opposed to You know, just basic cash back offers or coupons or things like that, like there’s a real opportunity to create a step change.

00:33:17 Paula Thomas

I I totally agree. And it’s, uh, you reminded me today Actually Derek Somebody just sent me a message and you know, I would say he’s probably in marketing, not in loyalty. And it was just really interesting to me his question, and I’m sure you’ll appreciate this was he was like How do loyalty programs make money like he actually, you know? And he’s not An airline guy you know definitely worked in in grocery But it was just really fascinating to have, you know, such a clear, simple and obvious question.

00:33:46 Paula Thomas

So I definitely think that we probably have a job to do and to kind of go This is how profitable our industry can be, especially when times are tough and that I’ve often said is when I got into Lordi. So you know, the 2008 Recession and there’s very few customers For example, in telecommunications the industry I was in, so churn reduction becomes a focus and I just think we’re we’re learning and I really like your point as well Derek, about learning from different industry. And again, thank you for sharing particularly things like you know the micro rewards things like bidding for upgrades, because that’s exactly what this show is here to teach people.

00:34:24 Paula Thomas

It’s like, well, how could that work in my, you know, retail store, for example Or in another sector So having gone through such a dramatic transformation? I think you’ve come out with something that people seem to love and is utterly transferable So yeah, I just think it’s a really nice way to to get some new inspiration.

00:34:43 Derek Whitworth

Well, I I really appreciate That, and you know it, it’s Actually an interesting question ’cause I I know I’ve certainly had friends and family members say. You know how How is it costing so much To buy back, Aeroplan what? You know what the heck is going on over there? And yeah it is It is a really It is a really interesting thing to dive into the Economics of loyalty Programs, because to your point. So many people Would say well, it’s all about the credit cards, and in many cases that is the case and you know certainly that was a consideration for Aeroplan.

00:35:13 Derek Whitworth

But you know the value and the data, the value, and the opportunities to engage customers The value to do a better job of allocating marketing dollars. You know these are these are hard costs that are hitting businesses and you know Businesses like ours that are Operating on razor thin margins like there’s real upside to generate off of.

00:35:32 Paula Thomas

That yeah, yeah, and I think as well what I’m hearing coming through from you guys is even the opportunity for surprise and delight because you know things like Starbucks being a part of the program really is an unexpected You know aspect, perhaps for an airline.

00:35:48 Paula Thomas

So I think that surprise and delight piece is sometimes difficult to integrate into the transactional side of our business and to deliver on that emotional benefit which I know you guys are super clear on.

00:36:00 Derek Whitworth

Yeah, and and I will say I think that’s that’s a space that we want to play in even more Next, you know I I mentioned to you previously. We we did a big transformation of our passenger service system, which is effectively the heart of the airline That kind of is the precursor or Something we had to do in advance of the relaunch of the Aeroplan program. But you know with with all of this underlying technology it actually gives us the ability to scale that type of surprise and delight and and deliver it in a, you know, a much more meaningful and contextual way for customers. So I I think as we kind of again, hopefully you’re starting to climb out of the pandemic.

00:36:34 Derek Whitworth

That’s a huge area of opportunity for us to actually deliver on those types of experiences Ways that really we didn’t have the capabilities to execute on in the past.

00:36:44 Paula Thomas

Yeah, yeah So if I was to summarize what you’ve said, I think what I’m hearing and it’s actually a political slogan in Ireland But obviously in a nice way. Lots done, but lots more to do. Would that be fair?

00:36:56 Derek Whitworth

Oh, that is the story of Aeroplan right there absolutely absolutely.

00:37:01 Paula Thomas

Brilliant Derek. Well listen, that’s all the questions I have from my side and is there anything that we haven’t touched on in terms of Aeroplan That that you would like To mention, before we wrap up.

00:37:12 Derek Whitworth

No, I you know, I hope we’ll maybe have the opportunity to continue the dialogue and maybe we can talk more about other learnings that have. Come out over The course of 2022, maybe sometime later this year into next.

00:37:23 Paula Thomas

Absolutely, and I know our friends obviously have announced the same conference will be coming up in Europe. I don’t know if it’s official and the actual City, so hopefully you and I can sit and have a coffee or a cocktail. Who knows. And later in the year, compare notes and catch up on everything that you’re doing. So with all of that said, I just want to thank you for a lovely conversation for some extraordinary work and inspiring the whole audience.

00:37:48 Paula Thomas

So Derek Whitworth, managing director of marketing and loyalty optimization at Air Canada. Thank you so much.

00:37:56 Derek Whitworth

Thank you so much.

00:37:59 Paula Thomas

This show is sponsored by The Loyalty People, a global strategic consultancy with a laser focus on loyalty CRM and customer engagement. The Loyalty People work with clients in lots of different ways. Whether it’s the strategic design of your loyalty program or a full service including loyalty, project execution, and they can also advise you on choosing the right technology and service partners on their website. The Loyalty People also runs a free global community for loyalty practitioners. And they also publish their own loyalty expert insights. So For more information and to subscribe, check out theloyaltypeople.global.

00:38:53 Paula Thomas

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