Bryan Pearson, CEO of LoyaltyOne, the company that runs Air Miles, said in a statement Friday that the company was focused on advising people about the change, and that it expected the news to be “well received by collectors.”JENNIFER ROBERTS/The Globe and Mail
Edgar Governo had been saving up his Air Miles to go to Europe. It was going to be a dream trip, visiting great landmarks around the continent.
"It would have been nice," he said.
Those plans went sideways this year.
Like millions of other collectors, Mr. Governo had been informed of the changes to the rewards program that would have seen points five years or older expire starting at the end of this year. Toronto-based parent company LoyaltyOne first announced the change in 2011, and was reminding customers this year to use their expiring Miles before the deadline.
Mr. Governo, a 38-year-old Winnipeg resident, anticipated he would have collected enough Miles for his European trip in another year or two. But not wanting to lose the value of his older Miles, instead he took a trip to Portland, Ore. in October – using up about 10,000 points on two round-trip tickets and accommodations. Then on Thursday, LoyaltyOne announced it was dropping the expiry policy, following political pressure and a backlash from customers.
Some people took to social media to express their relief that the expiry was cancelled, while others complained that they wished they hadn't rushed to use up Miles to meet the company's deadline.
"I enjoyed myself on the Portland trip. It was worthwhile, so I'm not saying I didn't get something, but it was purely based on a company policy," Mr. Governo said. "Now I feel a whole new kind of frustration. I changed my plans based on what the company told me, and for them to say they had changed their mind, it makes me feel manipulated."
He's not alone. "Today, our inbox has lit up," Andrew Wilson, a partner at Calgary-based law firm JSS Barristers, said Friday.
JSS is seeking certification that would allow it to pursue a national class-action lawsuit against LoyaltyOne.
Since the statement of claim was filed in September, Mr. Wilson said the firm has heard from roughly 2,000 people saying that they are among the affected collectors and sharing information that they suggested should be included in the claim.
It was filed on behalf of Red Deer, Alta.. resident David Helm, who had been saving up for a trip to the South Pacific, which "he would not otherwise be able to afford," according to the statement of claim.
Air Miles has roughly 17 million individual cardholders, and saw a 15-per-cent increase in the number of Miles redeemed for rewards in the first nine months of this year as the expiry deadline approached.
Mississauga resident Michelle Garcia rushed to use her Miles – with unfortunate timing. She spent 2,700 of her roughly 3,800 Miles on a Blue Jays jersey signed by Marco Estrada on Wednesday, just one day before the company announced the change.
"Literally the next day. I was like, 'Oh, jeez,'" she said. She was annoyed at having to spend her Miles before she'd saved enough for a trip. "They're Air Miles; I wanted to fly somewhere. I couldn't fly very far with 3,800 Miles, but I would have planned a trip [later]."
However, she said that she's happy with her jersey, which she plans to wear to games next season.
Gordon Preece was not so happy with his merchandise. The 65-year-old Winnipegger had saved about 9,200 Miles when he heard about the change. He and his wife had been dreaming of a trip after his retirement. But he was receiving reminders about the expiry, and so a week and a half ago, they went shopping for rewards.
"We weren't in a position to take a trip so soon," he said. "We spent about 8,000 on a mini red bar fridge and some binoculars, neither of which we wanted. But it was all we could find."
Indeed, some collectors have complained that not all rewards are visible to collectors on the site – an issue the company has said was a result of tailoring rewards to people's preferences, and that it would fix – and that the merchandise available was sometimes overpriced or undesirable. On Friday, Air Miles was informing some consumers that it would not be providing returns, order cancellations or exchanges on rewards that had already been ordered.
In a recent sit-down with The Globe and Mail, LoyaltyOne CEO Bryan Pearson said the expiry plan would improve customer "engagement" in the program by prompting collectors to check in on their balances, visit the website, and consider which category of Miles was most suited to them. In a statement Friday, the company did not address whether it has received any consumer backlash in the past 24 hours, but said it was focused on advising people about the change, and that it expected the news to be "well received by collectors."
"It's just wrong," Mr. Preece said of the changes. "I don't know how a company can get away with that."
Air Miles executives have emphasized that the program is a free service, although collectors do give up personal information including their shopping habits, which has financial value to marketers.
"It's a free service, sure. We'd be shopping anyway," Mr. Preece said. "But at the same time, in our case, we bought things that we wouldn't have bought, all that time thinking at some point we would be able to go on a nice trip when we retired. … I'll probably be dead before I can cash them in [for a trip] now. It's taken all these years just to get to 9,000."
In Milestone, Sask. on Friday, Deanna Brown had been keeping an eye on the Air Miles customer service online chat window for hours waiting to connect to an agent. She had already tried by phone but an automated message estimated the wait at about two hours. Having learned that the expiry policy had been reversed, she was trying to cancel an order she placed on the weekend for an immersion blender – 1,200 Miles had been debited from her account, but she could see the order had not yet shipped.
"I was hoping I'd be able to buy something useful. I went through the catalogue online for a few hours on the weekend, just trying to find something I could give as a gift, or use, and there wasn't a whole lot of really useful stuff," she said. "...I know there are bigger worries in the world! But it's a pain."
Though she has collected Miles for most of her adult life, Ms. Brown said she'd never really thought before about the value exchange that loyalty programs are built on: that in return for rewards, collectors share their personal information.
"They're receiving all this information about you. And after 20 years, you get an immersion blender you don't really want anyway," she said, with a laugh. "… Maybe it's not worth it."