The Canadian Loyalty Anomaly
I’ve recently returned from a rewarding business trip to Toronto with Urchana Moudgil, Upgrade Pack’s co-founder and COO.
For me, it was a welcome return to a city that I recall as being highly adaptive and open. Though some time has passed since I last worked with some of Canada’s leading loyalty programs, I was pleased to see these attitudes have not changed. Urchana, on her first visit to the country, was also impressed by the culture of openness and enterprise, both in a business and broader context.
A mature loyalty market crying out for disruption
The loyalty market in Canada is both thriving and mature: according to one study, the average Canadian participates in some 12.2 loyalty programs and 90% of Canadians have a loyalty card. Yet the same research also found that there remain some $16 billion worth of unredeemed points.
Travel is a predominant category among many of Canada’s leading loyalty programs, including Aeroplan, Air Miles, American Express Membership Rewards and CIBC Aventura, yet redemption is increasingly a challenge. The increasing complexity of points redemption, from program fragmentation and restrictions (such as points expiration), is thought to be driving member frustration and leading to reduced engagement.
So why are we entering a mature market where travel-led rewards are already prominent, and in light of the above trends?
The reason is simple.
Upgrade Pack is breaking new ground: providing an innovative, compelling loyalty benefit for customers. We deliver a genuine differentiator - even in established markets - where banks and card programs can,
* reward their customers,
* earn incremental revenue (users purchase their upgrades using our client’s own credit or debit card),
* learn more about their most valuable customers’ habits, drivers and motivations through upgrade data.
Their customers, meanwhile, gain access to a transparent and direct reward platform that they want to use, giving them a substantial savings on dynamically priced upgrades on their pre-booked flight or hotel.
A nation of travellers
According to HSBC’s latest annual Expat Explorer Report Canada now ranks fourth in its top five places for expats to live. Research by Kayak also revealed Canadians as a nation of adventurous travellers, using its tool to seek out an array of far-flung travel destinations. Both point to an active population of travellers who would benefit from exclusive access to flight and hotel upgrade offers that aren’t available elsewhere – all through a modern and intuitive app that’s quick and easy to use. Of course, the halo effect extending from this experience reflects well on the loyalty provider.
The people we met in Toronto were quick to recognise the differentiation opportunity provided by Upgrade Pack, with discussions progressing to how they could onboard our platform more rapidly than even we had hoped.
As I finish writing this blog on Canada Day, I look forward to our journey ahead, continuing to build collaborative partnerships with our Canadian partners.