Shoppers and Aeroplan face lawsuits for loyalty program changes - Macleans.ca
 

Shoppers and Aeroplan face lawsuits for loyalty program changes

New rules leave some customers asking how valuable the programs really are


 

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As rewards and loyalty programs have become important lures for chains looking to build brand loyalty, they’re also becoming more controversial. Shoppers Drug Mart Corp. is facing a class action lawsuit in Quebec over changes to its Optimum rewards program in 2010. Options Consommateurs, a lobby group, has been given approval by a provincial court to sue the company, which operates as Pharmaprix in Quebec, for devaluing its rewards points.

In July 2010, Shoppers announced a new conversion rate for its points: to get $1 in merchandise, customers would need 800 instead of 700 points. (The changes were effective Canada-wide but the lawsuit only represents Quebec customers.) Marie-Anaïs Sauvé, one of the lawyers representing the plaintiffs, called these changes “abusive” and “illegal” in a statement.

The case echoes another lawsuit, filed in 2009, also in Quebec, against Aeroplan’s reward program, which brought in unpopular new rules that see members’ points expire if they don’t redeem any miles at least once a year. At a time where loyalty programs are becoming the norm for major retailers, the lawsuits highlight questions over how valuable the programs really are. Michael McCall, a professor of marketing at Ithaca College who specializes in rewards programs, thinks companies are not handling the initiatives properly. “There are huge administrative costs,” he says, and, more importantly, “the programs themselves end up becoming debts on [company] balance sheets.” This, McCall explains, is the reason why companies have been trying to devalue their points, and trying to force customers to spend them faster. Unfortunately, those efforts are causing anger among many customers who are invested (financially and emotionally) in these programs.

The lawsuits against Shoppers and Aeroplan are not likely to go to court for another two years. McCall says this will allow Shoppers and Aeroplan to study their responses and even reconsider or redesign their loyalty programs. One thing they can’t do, he underlines, is ignore “consumers’ incredible ability to unite.”


 

Shoppers and Aeroplan face lawsuits for loyalty program changes

  1. oh please!

  2. If there is an Ontario suit, I would be up for joining this.  I’ve spent so much money obtaining points in both programs and it’s upsetting when they suddenly change – especially when you have the credit card.  It’s a violation of the contract.  Please keep us updated.  

  3. Read the term of these programs people – any program has the right to change.

  4. Les Quebeqois always are at the forefront of the consumer revolution. The rest of Canada is truly a SLEEPING KINGDOM. Canadian people will take everything in, the good with the bad. The revolt is impossible. Sheep!

  5. I just wonder why nobody sued 407 ETR? You don’t know that it’s a paid route, no signage indicate that, no signage indicates rates that you would have to pay and, on top of that, you don’t agree to pay those charges when you find yourself on that highway. So why do we take it from them?

  6. I was once a loyal Air Canada customer maintaining Aeroplan Elite status, but Aeroplan point redemption changes have disgusted me to the point of flying WestJet even if it the flight times aren’t as convenient.

  7. I also was a long time Air Canada customer having collected many hundreds of thousands of points/year. Aeroplans policies of never having seats available unless booked years in advance to unpopular destinations and the latest points expiry change resulted in me changing my remaining 50K Aeroplan points over to Esso cash cards for gasoline purchases with Points.com
     OH YEAH AND I ALSO fly exclusively West Jet and no more Air Canada
    – good bye and go away you miserable company that cannot even maintain decent relations with its employees!!

  8. This is a perfect example of government overreach. The laws regarding promotions are very obsure to say the least. Their overly broad and can apply to lots of different things.

  9. I just found out today that I lost 98,000 Aeroplan points. Yes, i was warned. so what? If I’m told I’ve earned something than how can it be taken away? Once gift certificates had expiry dates before that practice was deemed unacceptable. It’s time that reward points programs followed suit.

    Why isn’t the Better Business Bureau stepping in?