Thanks to a recent case study shared by another fellow blogger, I continue to question the “rewards” associated with one of Canada’s most beloved travel rewards programs: Aeroplan.
What is it? Aeroplan 101
With 150+ retail, financial and travel partners, Aeroplan is one of Canada’s main loyalty programs.
How do you earn Aeroplan Miles?
- Fly on eligible Air Canada, Air Canada Express, Air Canada rouge or other Star Alliance member airline flights.
- Purchase various travel products and services online.
- Shop at participating program retailers.
- Register for bonus promotions online when they occur.
- Use a bunch of credit cards associated with the program.
How do you use Aeroplan Miles?
- You can book a flight reward with Air Canada, Air Canada Express, Air Canada rouge or other Star Alliance airline partner.
- Purchase various travel products and services, entertainment experiences, gift cards, and other merchandise.
You can learn more about using Aeroplan Rewards here.
While this loyal program offers some decent benefits, there are some significant drawbacks to this program based on my own experiences:
- Matching the flight schedule with the desired travel schedule – finding the flight you want to fit your travel schedule has always been a bit of a nightmare for me using this program. Optimal times one-way, “red eye” flights on the return trip. Multiple stops for what could be a direct flight. Extremely lengthy layovers. These are just a few examples of schedules gone wrong.
- I’m always shocked at the number of Miles required for travel – for example in looking for flights recently to Europe the points requirement is 60,000 for one (1) economy seat (or 120,000 Miles per couple). In comparison, you can redeem 6,000 Miles for some $50 gift cards. That equates to, give or take, a travel rewards value of $500 for every 60,000 Miles redeemed and in this example, $1,000 per couple travelling to Europe. In looking at flights from Canada to UK round-trip, here is what it might cost to book a flight:
As you can see, using this particular flight 1) we’d be on some sort of milk-run (3 stops, over a day of travel), 2) we’d burn the 120,000 Miles ($1,000) and 3) spend over $2,000 in taxes, fees and surcharges. This is hardly a deal when, without much effort, I found flights with less stops, less travel time, for about $2,000 AND I could retain those valuable 120,000 “rewards” Miles.
- There is no such thing as “free” travel – advertisements for travel reward programs like Aeroplan, all tout “free airfare” yet there is really no such thing as a free airline ticket. As you have already seen in my example above there are taxes, fees and surcharges factored in for Aeroplan Miles. Don’t forget travel insurance especially if not covered by your credit card.
- Consumers are subsidizing travel rewards credit card users – it’s true… Yes, these loyalty programs have perks. However, merchants, as with any other costs associated with delivering a product or service, pass credit card fees on to their customers in the form of higher prices. This does not generate much fairness: customers who use payment methods associated with fewer benefits (such as cash, debit) end up subsidizing the costs of consumers that use premium or travel rewards credit cards, for the same cost of a product or service.
- To own a premium travel rewards credit card, I would need to pay a yearly annual fee to do so, to borrow money, that I don’t have in the first place – Most of us use credit cards to pay for goods and services we want but don’t have the cash at the time (or want to pay cash at the time of the transaction) to do so. This is fine, so long as we borrow money, short-term, interest-free and pay the balance every month. Even if you never carry a balance on your credit card, you are likely paying an annual fee to use your travel rewards credit card. Far worse, there are people that carry a credit card balance on their travel rewards credit card(s). These folks are paying money to use a travel rewards credit card, to make purchases, they can’t afford to pay off. This doesn’t make much sense to me.
I could go on but I won’t. I use my Aeroplan card to earn Aeroplan Miles (and I will continue to do so) but I don’t intend to own an Aeroplan travel rewards credit card in my wallet. I far prefer using a cash back credit card that has no annual fees. Cash back is tangible, I know the purchasing power of it and there are no restrictions. I intend, as I have done in the past, to redeem my Aeroplan Miles for short-haul flights or other rewards purchases. There are fewer restrictions, which mean more options that translate into fewer headaches. This sounds better to me.