♪ [theme]
>> This is Marketplace.
You've probably heard your Air
Miles aren't expiring, but you
haven't heard this story, how
ordinary people took on the
largest loyalty program in the
country and won.
It's "The People Versus Air
Miles".
Five Air Mile collectors, five
computers, five phones.
Their challenge, redeem their
loyalty miles.
By the end of our show,
who will feel rewarded
and who will feel ripped off?
>> Feeling pretty jaded right
now.
>> Mike, James, Ivan,
Joanne, and Razvan are loyal
long-time customers.
>> Five extra bonus miles.
>> They go out of their
way to buy from Air Mile
partners, shopping for
everything from gas to liquor to
groceries.
Millions of other Canadians are
trying to redeem their miles
too.
Our five are hitting the wall.
>> I've been running into some
major road blocks.
>> This guy's heard all
about those road blocks.
>> I'm fed up.
>> Says our five are not alone.
>> People aren't able to get the
rewards that they want.
>> Robb Engen's been
blogging about reward programs
for years.
He's here to expose the problems
collectors have with Air Miles.
Welcome, everyone.
So there's really only one rule
to this challenge.
You must use your miles to get
something you really want.
This is Robb.
>> Hi, everyone.
>> Hi, Robb.
>> Are you up for this
challenge?
>> Yes.
>> Yes, we're ready.
>> Okay, ready, set, get
shopping.
♪ ♪
Should we be saying good luck
to them and wishing them well?
>> I think they're going to need
all the help they can get.
♪ ♪
>> Has anybody gotten in yet?
Because I just keep getting the
circle going around and around.
>> They have the slowest web
site that I've ever experienced.
>> Just getting a spinning
circle.
>> Wow.
>> You know, I've heard from
readers they've had to click
five, six times to even get to
the page that they want.
>> Is everyone in?
>> Yep.
>> Our testers are under
the gun because of this.
Five years ago, news of the
expiry was buried near the
bottom of this press release
mentioning your miles will have
a five year timeline in which
they'll need to be redeemed.
No one here saw that.
>> There was not clear
communication from Air Miles
about the expiry.
>> I got nothing in writing.
I got nothing from them.
>> Wasn't mailed to collectors.
It wasn't made apparent on the
web site.
It was buried under the terms
and conditions and frequently
asked questions what is Air
Miles expiry all about?
So you really had to go digging
to even find any information.
The release itself said don't
worry, you don't need to do
anything.
So if someone even read it,
they might just dismiss it.
>> I think it was sneaky.
>> Very, very sneaky.
They obviously didn't
want us to know.
>> Why do you think they
would do it that way?
>> I think they were hoping
nobody noticed so that they can
clear these miles off of their
books and increase their
profitability.
>> Yep, expired miles are
better for the bottom line
because paying out rewards costs
the company money.
Maybe that's why Raz can't find
the reward he wants for his
miles.
He's looking for a TV.
>> Normally on any site I go...
>> Just search TV,
should come up.
>> But it's not coming.
>> Raz has been saving for
almost five years.
He's got just over 1,700 Dream
Miles.
>> 4K TV, nothing.
>> Nothing available.
>> Does that mean there
are no more TVs?
>> I guarantee you they have it.
>> All the rewards that you're
trying to find are buried deep
within the site and in some
cases impossible to find.
>> The website spits up a TV.
But guess what.
He needs 16,000 miles to get it.
Raz is way short.
Anybody want to give Raz some
miles?
>> They charge you money to give
people miles.
>> Do they?
>> Yes, there's a fee.
>> 15 cents for every mile.
>> Out of the goodness of
your heart if you want to give
someone else your miles?
>> 15 cents for every mile?
>> Yes.
>> That is insane.
>> I'm not giving you my wallet.
Sorry.
>> 15 cents, it's ridiculous.
It's outrageous as a matter of
fact.
>> There is another option.
It's called a dynamite deal.
One second.
What's a dynamite deal, Robb?
>> So a dynamite deal is what
Air Miles calls some kind of a
sale on their merchandise, so
you have to use some miles and
pay cash.
>> Pay your own cash.
>> Pay your own cash.
>> Out of your wallet.
>> To get a reward.
Does that sound like dynamite?
>> Let's see.
For that TV, he has to use all
his miles and fork over an extra
$1,743 in cash.
Hmm.
Seems crazy.
And listen to this.
>> The same TV is $1,699 at
 The Brick which is
actually cheaper.
>> So it's cheaper to buy
it at your local retailer.
>> At The Brick than buy from
Air Miles.
>> Doesn't sound dynamite
at all.
>> No, it doesn't.
>> What do you make of that?
>> This sounds like a classic
win-win for Air Miles.
They get to take some reward
miles from their customers and
you pay them cash for it.
>> Lose-lose for Raz.
>> Absolutely.
>> Definitely.
[laughing]
>> Maybe Joanne Moscone
is having more luck.
With 598 Dream Miles, she has
the fewest to burn.
What's she going to get?
She wants a hotel room in
Barrie, Ontario.
Surely she'll get that.
>> This is really frustrating.
It's telling me there are no
hotels available through the Air
Miles reward program.
>> Joanne knows what she really
wants. Travel certificates. But
they took those rewards away
from collectors like her.
>> I went to order my
certificates.
They're not there.
Can't find them anywhere.
Never notified any of us that
they were doing that.
>> So Air Miles discovered that
people like to redeem their
miles for things like gift
certificates which probably cost
Air Miles a lot of money.
>> Since 2012, the company
has been quietly taking popular
rewards out of the dream
category and sliding them into a
new category called cash, but
the majority of collectors are
stuck in dream, so they're
losing out.
>> What they really said back
then was that you don't have to
do anything different.
You can continue using the
program.
Meanwhile behind the scenes,
we've changed all the rules and
shifted things around.
So it's very sneaky on their
part, somewhat deceptive I think
to their collectors.
>> It's a reward program.
Why is there two sides? Why is
there expiry dates?
When you earn those Air Miles,
you earn them.
>> Over here, more road blocks.
Anyone looking for a flight?
I think all three of you are,
aren't you?
>> Yes, I did and I gave up.
>> Ivan Hrabowsky has
about 5,000 miles to burn but
he's finding the web site
confusing.
What are you going to do?
>> Cry in my beer.
It has to be gluten-free beer,
though, and that doesn't taste
too good.
[laughing]
>> Michael Judd's laughing
through his pain. He's got the
most miles here.
He's desperate to get to
New Zealand to visit family.
>> How's your search going,
Michael?
>> Not great. About the same as
it's been going the last six
months. Dead ends. Just
searching, searching, searching.
>> You'd think after searching
for half a year and being
somewhat flexible, he'd
find a flight.
>> It'll crash.
It'll time out. Even though
you're working, it says, it
times you out.
Other times, you'll get a little
bit further and nice big window
will pop up saying, sorry, but
we're experiencing technical
difficulties.
>> It does make you wonder, is
it intentional on Air Miles
part?
>> I suspect as soon as they see
I've got a lot of Air Miles,
they say, ooh, let's give
him some road blocks.
That's all I can think of.
>> And that's no way to treat a
loyal collector.
>> I've spent somewhere between
three quarters of a million
and a million dollars with Air
Miles business partners.
I'm a good customer.
>> So is James Fulcher.
He has 25,000 miles.
He wants to take his wife on a
dream trip.
Where are you going, James?
>> Well, I was planning to go to
London from Montreal.
>> Check it out.
He finds a flight.
But wait, there's a snag.
He's got to fork out extra cash
on top of his rewards.
>> The taxes and fees through
Air Miles was $618.
>> $618 extra?
Is that fair?
Well, over at Air Canada's site,
exact same flight, only $253 in
taxes and fees.
>> Unless it's broken out for us
in a different way, it looks
like Air Miles is gouging on
this.
It's a cash grab, disguised as
taxes and fees.
>> In some cases, Air Miles
taxes and fees appear to
be much higher than those
charged by airlines.
>> People join rewards programs
because there's supposed to be a
fairly significant cash savings.
That's the motivation for
joining the rewards program.
This clearly is not working.
>> Got that right.
Time for some answers.
Want to call them up?
>> Sure, let's do that. Okay.
[dialing beeps]
[phone rings]
>> Welcome to the Air Miles
reward program.
We are experiencing higher than
normal wait times.
We're not able to take anymore
calls today as the current
expected wait time exceeds our
operating hours this evening.
>> They're open until 6:00 but
they're not taking any more
calls.
>> Sorry, we were not able to
assist you further.
>> And it's 3:30.
>> They just hung up on you.
>> They just hung up.
>> Feels like they're stealing
my money.
>> When we come back,
"The People Versus Air Miles"
continues.
>> This is your Marketplace.
>> The real deal on your
 Marketplace.
>> We're not able to take
anymore calls today as the
current expected wait time
exceeds our operating hours
this evening.
>> Air Miles has just hung
up on some unhappy collectors.
>> Wow.
>> What just happened there?
>> I feel like I can't do
anything.
>> Obviously they don't have
enough staff in their call
centre to handle all the
inquiries they're getting.
>> But we're not giving up
because we have a secret weapon.
Joanne's a VIP collector.
>> Well, I'm onyx. I'm supposed
to get priority on the queue.
>> Will her special status
help this group bust through?
>> Welcome to the world of onyx,
the ultimate Air Miles
experience.
>> Hello, you're speaking with
Carol. How may I help you?
>> Hi, Carol, it's Joanne
Moscone calling.
>> Joanne wants to know
why they moved her Marlin travel
certificates.
>> And you took them from the
dream side and moved them to
the cash side.
>> Okay.
>> So why wasn't I ever
notified that you were moving
Marlin to the cash side?
>> It's been on our web site.
I'm not sure how it missed you.
>> Well, I am continually on
your web site and I never once
saw that.
Why can you not move those Air
Miles over to the cash side for
me?
Don't tell me it's two different
services, two different things
because you are Air Miles,
you're one company.
>> So if it could be done, we
would be more than happy to, but
it's not something that can be
done.
>> Why?
>> The Air Miles dream does not
have a cash value and cannot be
transferred.
>> Okay. Why?
>> Because they're two separate
programs.
>> No, don't tell me that. Don't
tell me that. You are air miles.
You wrote the program.
Why can't you move those over?
>> Remember, the program can
make changes, right, with or
without notice.
It's clearly outlined in
everything on our web site in
all the terms and conditions.
>> Well, I'm getting really
frustrated.
I'm getting nowhere here.
>> But we're not ready to
hang up.
>> I tried to book a flight.
>> James can't wait to get
a breakdown on all those extra
flight fees.
>> These are all charges that
are going to the airline.
So $350 is the airline
surcharge, then there's a Canada
air security charge of $25.91.
>> She spells it out, but
it doesn't make sense to James.
>> Maybe what you have to do,
James, is give Air Canada a call
and they might be able to better
explain it because honestly,
when it comes to the price and
taxes, that's not something
that's controlled by us.
>> You're asking me to call Air
Canada, for example, to find out
why you're charging so much in
fees and taxes.
>> This call's going nowhere.
♪ ♪
>> Hello?
>> Hello.
>> I'm still here, James.
>> Okay.
>> I just didn't know what else
to say, to be honest with you.
>> We check with Air
Canada and get this.
Air Miles is slipping more than
half of the cost of that flight
into those extra fees.
Some reward.
Can anyone take off?
>> I've been trying to book a
flight for quite a period of
time to New Zealand.
>> Michael spent countless
hours on the web site.
>> Seems all but impossible.
I'm trying to figure out why.
>> He's had enough.
Surely Carol can fast track the
search.
>> When it comes to searching
flights on our web site, we
share the same tools.
We have to do the same as you.
>> So basically for me, for me,
you really can't help me as
such.
I have to just keep trying
different dates.
>> I wouldn't be able to help
you any different than what
you've already seen on the web
site, to be honest with you.
>> Wow, that's really
disappointing.
>> Clearly nobody's
leaving a winner today.
We find something that might
explain why.
A business document.
Turns out they don't want us to
redeem all our miles.
Their goal, have us burn up less
than three quarters of them.
Execs say we actively control
the program via the options that
you can redeem for.
Is that why so many Canadians
are having trouble?
Are any of you satisfied right
now?
>> [all]: No.
>> I think they want them to
expire.
>> It's greed.
>> They have to hold them in
trust for us for when we spend
them, all that money.
It's a lot of money.
Millions and millions of
dollars.
>> What message do all of
you have to Air Miles right now?
>> Well, the first message would
be cancel the expiration.
>> Yes.
>> Yes.
>> Absolutely, cancel the
expiration. It's totally unfair.
>> I'm so frustrated with this
reward program that I'm done.
I've been loyal since 1993, and
this past year, I've had nothing
but frustration.
>> You're cutting up your card.
>> Done. Moving on.
Different reward program.
>> Wow.
>> Air Miles just lost a
customer.
>> They did, a loyal one.
>> Raz, you're clapping.
>> I am, because I'm pretty much
going to do the exact same
thing.
Actually, I'm going to borrow
that.
>> Here you go.
>> Yeah, you know, I'm not sure
how much they will see,
but I'm out.
>> Goodbye.
>> What are you going to do?
>> I'm going to fight it as long
as I can and not just for
myself, for others.
♪ ♪
I'm not giving up
on this at all.
>> Back in his hometown of
Oakville, Ontario, Michael's on
a mission.
>> I've been in touch with Air
Miles' president's office.
>> He's complained to the
Better Business Bureau and that
got Air Miles to follow up.
They say they're trying to get
him that flight to New Zealand.
>> Hopefully I'll get it.
>> But he's not banking on it,
so he's ramping up his fight.
>> Like they say, the squeaky
wheel gets the grease and right
now, I am the squeaky wheel.
>> Thank you for calling the
office of the president.
Our specialists are not
available to personally take
your call at this time.
>> Typical.
>> We apologize for this
inconvenience.
[voice mail tone]
>> Get back to me as soon as
possible.
That would be very much
appreciated. Thank you.
[hangs up]
In my mind, shouldn't even
legally be allowed to happen.
Those funds are put in trust for
me to use.
And as far as I'm concerned,
they were there forever or until
I use them.
It feels like they're stealing
my money.
>> Time is running out.
So Michael's taking it all the
way to the Ontario legislature.
>> I'm fighting for myself and
everybody else that's in the
same situation.
>> There's a private
member's bill on the table to
ban all loyalty reward points
from ever expiring.
>> Michael!
>> Hello.
>> Welcome to Queen's Park.
>> MPP Arthur Potts is the
man behind the bill.
Michael's come to plead his
case, lay out what's at stake.
>> To attain the points I
have over the years, I've done
in excess of 70,000.
Well, that's three quarters of a
million dollars.
>> That's incredible.
>> With Air Miles business
partners.
>> So you've earned those.
>> I've been very loyal.
>> You've earned those points.
>> I have.
>> I've heard from so many
Ontarians just like you, they
call me up and say, this is
wrong, they're stealing my
points and you got to do
something to stop it.
>> Yeah.
>> How confident are you
that this is going to pass?
>> I think there's a good chance
we get this thing done by
Christmas.
It will be an early
Christmas present.
>> Okay, that would be
wonderful.
>> So will it be a
wonderful life?
While the clock ticks, Michael's
hoping for a Christmas miracle.
We're going to bring your answer
to Canadians and they're not
going to like what they just
heard.
>> We have offered the
opportunity...
>> The fight's not over yet.
Air Miles isn't backing down and
neither are we.
This is your Marketplace.
>> You can't afford to miss
this.
For long-time Air Miles
collector, Michael Judd, it
looks like his Christmas wish
may come true.
He's at the Ontario legislature
to talk to politicians who have
the power to outlaw expiry
dates for all loyalty programs.
[gavel pounds three times]
We're here too, along with
Air Mile execs.
>> Today, we're dealing with
Bill 47 with respect to reward
points, and as we understand it,
there are several people who
wish to speak.
>> This is the moment
Michael's been waiting for.
>> It really and honestly feels
like I'm being blocked
with purpose and intent.
The level of service I would say
is less than 1 per cent of what
it was in the 90s.
It is right now, from my
perspective, appalling.
It's been very painful.
>> Next up, the CFO and VP
of Air Miles owner Loyalty One.
>> Mr. Judd, we are working to
resolve your issue.
However, let me please say this
to the committee.
Mr. Judd's experience is not the
norm.
We receive more than 13,000
direct customer contacts and
process over 42,000 redemptions
a day.
This translates to an order
every two seconds totalling over
$2 billion in rewards value over
the last four years.
>> And their response to
the bill?
>> Now the government has put
all loyalty programs on notice
and essentially handcuffed
business with respect to the
management of its own affairs.
This will have a negative impact
on the loyalty landscape in
Ontario.
Let me be clear, the impact of
this bill will be far reaching.
>> For weeks, we've been
asking for an interview with
Loyalty One and they've
declined.
Maybe they'll talk to us today.
We're with CBC Marketplace.
We just want to ask, you heard
in there, we've talked to so
many Canadians who just want you
to cancel that expiry policy.
Why won't you back down?
>> We have shared our point of
view with the committee.
We have talked to them about
having a comprehensive and
collaborative conversation as it
pertains to the matter at hand.
>> VP of Corporate Affairs
Mitchell Merowitz had better
hurry. The legislation
is expected to pass.
If this bill goes through, what
about the rest of Canada?
You're going to be forced to
cancel the expiry policy, won't
you?
>> As I said, I'm not going to
speculate on these matters.
What we are hoping to do is have
a conversation, an open
conversation.
>> Air Miles says suggestions
they don't want Canadians to
redeem their miles couldn't be
further from the truth and
they've been improving their web
site and customer service, but
remember that document we dug up
reveals management wants less
than three quarters of miles
redeemed.
You don't want all your
collectors to redeem their
miles. We found it in
transcribed notes.
>> What we want is our
collectors to stay actively
engaged in our program to both
earn and redeem.
>> Less than 48 hours
after our exchange, Air Miles
caves to public pressure.
They cancel the expiry policy.
So that's a win for the people.
Or is it?
Look at this notice to their
shareholders.
Loyalty One will adjust the
value proposition to collectors.
Translation?
They're going to devalue your
miles to make up for their lost
profit.
Canadians aren't happy about
any of this.
[multiple tweet whistles]
Congrats on making Canadians
unloyal to your loyalty
program.
Livid with Air Miles right now.
Wish I saved my points and
redeemed them for something I
really wanted.
Hey, Air Miles, can I return the
item I purchased only because I
didn't want to lose my points?
>> Here's Air Miles' response.
[tweet whistle]
We are not accepting returns,
cancellations or exchanges due
to the cancellation of the
expiry policy, once booked.
The case of "The People Versus
Air Miles" clearly isn't over.
We're not closing this file just
yet. We'll continue to keep
watching to make sure you're
getting the most
out of your miles.
♪ [theme]
