Who among us has not wished for his or her own personal bat cave? With the push of a button, a secret door slides open to transport you out of the day-to-day.
Aeroplan is looking to bring a bit of that escapism to its customers. In a nationwide advertising campaign launching on Friday, elite members are shown pushing a little silver button and escaping to a tropical paradise through rotating walls, the ceiling of a salon, and a secret door hidden behind a clothing rack.
But this is more than just a standard promotion for a popular travel rewards program. It is the largest marketing effort Aeroplan’s parent company, Aimia Inc., has ever undertaken, and is the first time Aimia has advertised on television in about a decade. It’s being driven by the huge growth in competition for customers who want credit cards that offer some kind of reward and major changes to the Aeroplan program that some say has caused confusion.
“It’s large for us,” Aeroplan’s vice-president of marketing and innovation, David Klein, said during a recent interview. “We’re different from a lot of advertisers because we reach our members effectively one on one. But there are times when we have to go outside of our channels, because the story is bigger, because we need to get into a space where dialogue is happening like it’s happening today.”
Aimia regularly uses its own channels to advertise, via an e-mail database of its members, direct mail, and online. The company’s partner, Canadian Imperial Bank of Commerce, undertook its own mass media marketing for the credit card as part of the agreement.
When rewards marketing in the credit card space began heating up in 2010, that started to change. The Montreal-based company, which runs loyalty programs around the world, began spending more on advertising outside its own channels – mostly in print, radio, and outdoor ads such as billboards. And now, spending on mass media advertising this fall alone is double what Aimia has spent on any given year in its history.
Part of the push is due to a change in the program’s structure. Aimia’s contract with CIBC was up for renewal this year, and negotiations did not go smoothly. After a tussle with Toronto-Dominion Bank, in September it was announced that the two financial institutions would split the partnership. In the new year, TD will buy half of CIBC’s Aeroplan portfolio.
These types of rewards cards are incredibly important marketing tools for the banks, because they can be an entry point for acquiring new customers. Customers who might be resistant to switching banks may sign up for a second bank’s credit card if the rewards are attractive enough.
Last month, CIBC launched an enhanced travel rewards card of its own. Called Aventura, the program had been around since 2007, but was relaunched with promotional extras to entice new members, and ads featuring its new spokesbird, Percy the Penguin. During a conference call to discuss its quarterly earnings in May, CIBC said its plans to spend $50-million over the course of the year in marketing for Aventura. In December and January, the bank will launch new television commercials introducing viewers to Percy’s family.
“When we look around the world, no other market is as developed or as competitive as Canada in the travel reward space,” said Stephen Forbes, executive vice-president of marketing at CIBC.
Under the new agreement, CIBC will only have the right to advertise its Aeroplan card within its own channels – through direct communication with customers and in bank branches for instance – while TD will have rights over mass-market advertising. TD declined requests for comment on its plans for marketing the new Aeroplan partnership.
Now, Aimia has stepped in to be sure it is promoting the program as well, amid intensified competition. But the heat is not only coming from CIBC. Other competitors have grabbed a bit of the spotlight that the Aeroplan credit card tussle created.
“We got a lot of card members calling. There was quite a bit of concern and confusion in the marketplace,” David Barnes, vice-president of advertising and communications at American Express Canada Inc., said. American Express has an Aeroplan co-branded charge card. With the confusion over the TD-CIBC transfer, the company saw an opportunity to advertise its other rewards offerings. “It made people pay attention to the card that had been in their wallet for a long time, and ask how it works.”
In mid-September, after the Aimia deal was announced, American Express Canada increased its marketing spending, buying TV airtime for an updated commercial for its Gold Rewards travel credit card. It also spent more on digital advertising, outdoor ads, public promotions and social media, and offered bonus points to new members.
“It’s probably the busiest third quarter we’ve had from an advertising and marketing perspective in about a decade,” Mr. Barnes said. “It points to the significance of the opportunity. This kind of shake-up in the credit card market does not come along often.”
Royal Bank of Canada’s Avion card, which has more than a million members, has also released a new commercial, which began airing on Sept. 23. Linda Mantia, executive vice-president of cards and payment solutions, declined to say whether RBC has increased its advertising budget, but she did say that all the news in the space has been a boon to marketing for travel rewards cards.
In June, Aimia took steps to sweeten its card offering: It eliminated its seven-year expiration date on its miles, reduced the miles needed to buy seats on certain flights, and introduced a new recognition program for top points earners, called Distinction. That program is the focus of Aimia’s new advertising campaign. At the heart of it is an effort to retain its best customers – some of whom may have been confused or upset by the changes coming to the program.
“The root of this is really solidifying our relationship with our members,” Aeroplan’s Mr. Klein said. “…TV has traditionally been, in Canada, the place where products are launched. That’s what we’re doing. We’re relaunching the product.”Report Typo/Error