Originally Posted by
YEG USER
Even the whole "customer database" thing doesn't make sense to me, as AFAIK AC has all of the information for flight bookings for AC/*A as they are the ones who pass the information on to Aeroplan for mileage crediting, etc. I will concede that there can be a concern with competitors gaining access to AC information, but for various reasons I don't think it is a huge concern for AC.
However AE has databases that include all your credit card purchases.. Inother words, they know how better than you do yourself.
Whether AC values that, who knows.
I think AC's main risk in the starting of its own FFP is alienating Altitude and other Aeroplan members (those who fly, but not enough to attain status) who have large balances and can no longer redeem on AC/*A, as well as people not wanting to fly AC in 2019/2020 for fear of orphaning their miles. I think this is the main reason why AC was willing to absorb "$2 billion" worth of liabilities in taking over Aeroplan (even though the cost to AC wouldn't be anywhere near $2B), and of course, getting Aeroplan for "cheap" is likely easier than starting over from scratch. I suspect the cash portion was coming from the CC companies as they have their own vested interests.
I don't quite think so. AC might be concerned about the loss of high end customers; however for many of these other issues such as status, MM, etc. may be more important than rewards, and as long as they don't have huge balances, they may fell they'll be able to use the miles.
As to the middle of the pack, it's getting thinner by the day.
Further, if AC starts noticing that they are getting hurt, there are things they can do to reassure/buy people in on a quick notice.
So I suspect it is the credit cards that are suffering and actually were in te driver's seat.
To avoid issues with people avoiding AC in 2019/2020 for fear of orphaning miles, etc. I think AC will likely enter into a new agreement with Aeroplan, whereby AC will become a "redemption only" partner for a few years and in exchange Aeroplan will get AC to agree to access a certain amount of inventory at current (or similar) mileage levels for AC/*A. This would also provide a continued revenue stream for AC.
Possible.
In the long run, I think if AC doesn't buy Aeroplan and starts its own FFP, that AIMIA will regret not having taken the increased offer. Even if Aeroplan can be a viable program, I don't see Aeroplan being as valuable to AIMIA once there is competition from AC's FFP.
Latter being a big if still. Agreed that Aimia will eventually regret not having taken the offer.