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The Globe and Mail is reporting that ACE Aviation Holdings, Air Canada's parent company is on the verge of announcing a public offering in Aeroplan, Air Canada's loyalty program and that country's leading consumer reward program.
This isn't the first time Aeroplan has been the subject of such discussion. In 2003, the investment group Onex Corporation was set to take a 35% stake in Aeroplan for CAD $245 million ($194 million) -- a transaction that valued Aeroplan at CAD $900 million ($712 million). More recently, Aeroplan was valued at (USD) $900 million to $1.2 billion.
Who said these programs aren't big business?
Does the world really need another co-branded airline card?
That's the question which inevitably arises with today's roll-out of the new SkyPoints credit card, issued by American Express in conjunction with Delta.
Just like the current SkyMiles credit card, also issued by Amex, the SkyPoints card awards users with 1 point (a SkyPoint, not to be confused with a SkyMile) for every $1 in charges. Also like the SkyMiles card, the points are doubled for charges at supermarkets, gas stations, drugstores, home improvement and hardware stores, the U.S. Postal Service, for wireless phone bill payments and for Delta and Song purchases.
The new card assumes its own personality on the awards side.
SkyPoints can be redeemed for discounts, in the form of a statement credit from American Express, on Delta tickets, as follows: 3,000 points may be redeemed for a 10% discount off the first $500 of a ticket's price; 7,500 points get a 25% discount; 15,000 points equals a 50% discount; and 20,000 points redeem for a 75% discount.
Doing the math, assuming the 75% discount award and a ticket with a price of $500, the value of the points would be 1.8 cents. Assuming a ticket price of $300, the points' value drops to 1.1 cents each. Those values are neither stellar at the high end nor criminally meager at the low end. On a scale of 10: a 6 for value.
If the card is just OK from a value standpoint, it's a big step forward on the flexibility front. The ability to redeem as few as 3,000 points for a meaningful if modest award is welcome.
And perhaps the best part: since the discounts are applied to the price of revenue tickets, consumers are not subject to the capacity controls which have made loyalty programs such a hit-and-miss proposition lately.
Oh, and SkyPoints can be redeemed for SkyMiles, at a 1:1 exchange rate, with no transfer fee.
The card costs $49 annually, waived the first year. Annual percentage rate is variable, currently 15.99%. New cardholders receive a 2,500-point bonus after the first purchase.
The news release enthuses: "The SkyPoints Credit Card is a perfect complement to the American Express and Delta co-brand cards." Wishful thinking. I predict that the second card will cannibalize current and future SkyMiles card customers.
Here's some gratis advice for the marketing honchos at Amex and Delta. Combine the features of both cards into a single card. Cardholders then choose between earning SkyPoints and SkyMiles by checking 1 or the other in their online profiles (or by phone or mail, for the offline set). This is easily done and widely understood by consumers, who have been trained to make exactly such a currency choice by most major hotel programs, which award either hotel points or airline miles, but not both.
Benefits are good; simplicity is better.
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Between May 19 and June 15, OnePass members may redeem a Standard Economy class reward ticket for travel to Bristol or Belfast for 25,000 miles, half the normal requirement.
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Early Returns members will henceforth earn 500 miles for qualifying rentals of 5 or more days.
In addition to the new rate for longer rentals, through Dec. 31 members will earn 500 bonus miles and save $5 per day on Leisure Weekend Rate rentals of 2 or more days, or earn 500 bonus miles and save $20 on Leisure Weekly Rate rentals.
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Hilton HHonors members will earn triple miles in the programs of American, United, Hawaiian or Northwest for stays of 4 or more nights booked by May 31 for stays through June 12 at the Hilton Waikoloa Village on Hawaii's Big Island or Hilton Hawaiian Village on Oahu.
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Between June 1 and Aug. 31, Rapid Rewards members will earn triple credits -- 1.5 instead of the normal .5 credits -- for stays at Econo Lodge and Rodeway Inn hotels in the U.S.
Members should cite their Rapid Rewards number at check-in to receive the bonus.
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Between May 15 and Aug. 15, Mileage Plus members will earn 125 bonus miles per bottle with the purchase of any wine from Robert Mondavi, Simi, Franciscan Oakville Estate, Ravenswood and Estancia.
To participate, Mileage Plus members must also be enrolled in GroceryMiles and use a Dominick's Fresh Values card at checkout.
Registration is required.
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