What Can Air Miles do with all those Expiring Miles?

In December 2011, Air Miles announced going forward its reward miles will only be valid for 5 years. As a result, after December 31, 2016, Air Miles older than five years begin to expire on a quarterly basis. Air Miles spokesperson have repeatedly noted some collectors are “still not using the miles they collected decades ago” and “believe five years is very reasonable to expect someone to use miles and get a reward that betters the way they live their lives every day.”

The expiry information has been provided on the Frequently Asked Questions section of the Air Miles website. However, the CBC has concluded Air Miles may not have distributed any public follow-up announcements since 2011 or any warning messages to its customers.

Regardless, word has gotten out to enough Air Miles members to apparently generate problems for Air Miles and consumers. Media outlets have recently commented on frustrations experienced by Air Miles members trying to redeem their older Air Miles for fear of losing them. Phone wait times have reportedly been 2 hours or more. Air Miles notes many rewards options are redeemable online. However, items such as vacation package deals must be booked by phone. Thus consumers wanting to spend their hard-earned Air Miles on that dream vacation or a trip to see family have little choice but to stay on hold or attempt requesting a callback by Air Miles staff.

Redemption Spike Could Have Been Foreseen

Air Miles could have anticipated this spike in redemption demand based on a previous experience by Aeroplan. In the late 2000’s, Aeroplan instituted a policy where loyalty points more than 7 years old were to begin expiring on January 1, 2014. In 2013, an annual North American seat reward availability survey noted the availability of flights through Aeroplan took a dramatic dive in 2013 when compared to previous years. A reasonable person could conclude the reduced availability of Aeroplan reward flights were a response to the approaching point expiry deadline.

About 6 months before points initially expired Aeroplan canceled the expiration policy. However, it appears Air Miles is not willing to follow suit. This leaves Air Miles in a quandary. A program designed to keep customers happy and have them spend on products and services is now irritating some of their members by:

Taking some of their loyalty currency away
Making the redemption process a less than pleasant experience

PIAC contends the redemption process is critical for both consumers and loyalty program providers – a positive redemption of loyalty points may lead customers to become brand advocates for the program. A negative redemption process leaves consumers alienated, which is the risk Air Miles increasing faces as its points expiration policy inches closer to reality.

How Can Air Miles Respond?

A simple yet effective response would be for Air Miles to simply employ more staff at their call centre to address the excess demand. Air Miles could follow the lead of Aeroplan by cancelling the expiry policy before it takes effect December 31, 2016. However, assuming Air Miles remains committed to having their miles expire, here are a couple of suggestions to remove some of the public relations sting out of the collective frustration experienced by their Canadian customers. Air Miles stands to gain by having millions of Air Miles expire each year going forward. Each expiring Air Mile represents an outstanding liability removed from its books. In response, Air Miles could take a percentage of expiring Air Miles and donate them to any number of the thousands of registered charities operating in Canada. Alternatively, Air Miles could establish an “Air Miles Charity Bank” where organizations could submit short applications for Air Miles to further their charitable activities, fueled by expired Air Miles.

These suggestions allow Air Miles to create new beginnings out of a story that so far has only grown a bumper crop of consumer frustration.

Jonathan Bishop has been a Research Analyst with the Public Interest Advocacy Centre (PIAC) since 2012.

PIAC explored the operation of customer loyalty programs in Canada in 2013, noting consumers have little recourse when loyalty program providers unilaterally decide to devalue their loyalty currency, or change other terms and conditions of loyalty programs. PIAC advocated for industry-wide guidelines relating to loyalty currency devaluation, transfers and bequeathal. Moreover, the report entitled, “Customer Loyalty Programs: Are Rules Needed?”, called for the creation of a complaints body for consumers on issues that arise relating to the operation of loyalty programs, as well as guidelines for the notice given to changes in loyalty program terms and conditions.

CCTS: Why Does No One Know Your Name? The Story of Service Provider Compliance

Recently, the Commissioner for Complaints for Telecommunications Services (CCTS) released survey data indicating only 2% of survey respondents who thought they had options could identify the CCTS as a recourse avenue if they experienced an unresolved compliant with their communication service provider. These services include home phone, wireless service, home internet or cable and satellite television service. The same survey data indicates 20% of respondents have heard of the CCTS. While it would be simple to blame the hard-working staff at the CCTS for this lack of awareness, it would also be unfair. Clearly, there is more to this low level of public awareness of the CCTS than meets the eye. PIAC would like to take a moment to partially unravel this unfortunate mystery.

Shortly after the CCTS was established, a public awareness plan was put in place committing participating telecommunications service providers to undertaking activities to ensure customers were made aware of CCTS and the independent dispute resolution service they offer. In 2012, the plan was amended and currently includes the following undertakings by service providers:

Service providers are required to place on their web sites a notice about CCTS and a link to the CCTS web site.
Service providers are required to place notices about CCTS on customers’ bills four times per year. They are also required to provide notice to customers who do not receive bills, such as pre-paid wireless customers.
Service providers are required to notify the customer about the right of recourse to CCTS following the second level of escalation in the company’s complaints process.

According to the CCTS, the awareness plan is built on the strategy of ensuring information about CCTS is readily available to customers at the time they experience a problem. PIAC has previously been critical of this approach, stating part of the role of the CCTS is to promote to the public at large that an avenue is present for Canadians with unresolved telecommunications service issues. Quite simply, if more Canadians knew the CCTS existed, the CCTS would be more effective in fulfilling its mandate to assist those Canadians with unresolved complaints.

However, at the present time, the task of promoting the CCTS falls to participating telecommunications service providers. The job of Rogers, Bell, TELUS et al. is to provide notices on their websites about the CCTS, place notices on their bills 4 times a year and notify their customers if a complaint remains unresolved after review, among other activities. But who makes sure this happens? Does it happen?

The CCTS has noted publicly it does not have the mandate or the resources to do formal auditing of compliance with aspects of its public awareness plan. However, according to unofficial data collected by the CCTS and submitted to the CRTC in 2015, there is evidence service providers may not be very diligent in their promotion of the CCTS.

For instance, CCTS sent compliance surveys to 133 participating telecommunications service providers (PSPs) and received 47 replies, for a response rate of 35%. With those 47 replies, this is what was found:

38 of 47 respondents have web sites that contain the required notice and link, and the text of the notice as required. This is a compliance rate of 81% of respondents.
However, the CCTS Public Awareness Plan also requires that if a PSP’s web site has a search function, seven prescribed terms (“complaint”, “dispute”, “agency”, “CRTC”, “CCTS”, “commission” and “ombudsman”) should return a link to the page with the CCTS notice and web site link. Only 2/26 were actually fully compliant (i.e. all seven search terms returned the CCTS web page). This is a compliance rate of 8% of respondents.
31 of 47 of respondents self-report that they are compliant with the requirement to place notices about CCTS on customers’ bills four times per year, a compliance rate of 66% of respondents.
7 of 20 respondents reported compliance with having a process for delivering notices about CCTS to customers not receiving a monthly bill.
CCTS considers customer notification during a complaint process the most important feature of the Public Awareness Plan, yet admits the CCTS has no real ability to monitor PSP compliance with this provision. CCTS concluded that 15 or 47 respondents report a customer notification process that appears to be compliant with the Plan. This is a compliance rate of 32% of respondents.

In our view, the argument of the CCTS – that awareness of its existence is readily available to customers at the time when they need it – is only viable if service providers are diligent in providing the information. However, it is clear not all telecommunications service providers are fulfilling their obligations to the CCTS or to Canadians.

As an outside observer, this begs a number of questions:

Does the CCTS intend to measure the compliance of service providers going forward?
At what point is the CRTC partially responsible for allowing this chronic non-compliance with the CCTS participation agreement?
Will the CRTC provide the deterrents required to ensure telecommunications service providers fulfill their public awareness obligations regarding the CCTS?

PIAC believes that until a substantial proportion of the Canadian public is aware the CCTS exists, attempting to determine its effectiveness in fulfilling its mandate remains elusive. The degree of public awareness of the CCTS is crucial to its effectiveness—consumers will not seek recourse with the CCTS if they are not aware that it exists or of how it might help them.

Thus far, the blame for a low number of Canadians being aware of the CCTS as a recourse avenue can be fairly placed equally at the feet of the CCTS, Canada’s telecommunications service providers and the CRTC. However, it does not have to remain this way. The CCTS can routinely monitor service provider compliance with the elements of their public awareness plan outlined above, as they did in 2015. The service providers can simply do what they have agreed to do, and do it better. Meanwhile, the CRTC could be imposing enforcement deterrents for those instances where service provider non-compliance of the CCTS has become habitual.

For PIAC, ensuring more consumers are aware there’s a way to resolve their communications complaints is the objective. Taking action to ensure Canada’s telecommunication service providers fulfill their awareness obligations consistently would be an ideal first step.

Jonathan Bishop is a Research Analyst with the Public Interest Advocacy Centre (PIAC)

CCTS Survey Highlights Public Awareness Challenge

The Commissioner for Complaints for Telecommunications Services (CCTS) has a problem – few people know it exists. In fact, a recent survey indicated that only 2% of Canadians who had an unresolved complaint with a company providing a telecommunications service could name the CCTS as the agency to approach to get the dispute resolved. As a consumer advocate, I wouldn’t care if the CCTS were selling widgets or sporting goods. However, because the CCTS is an industry-funded organization dedicated to working with Canadians and their telecommunications service provider (TSP) to resolve complaints relating to telecommunications services, I do care, and care deeply. I just wish the CCTS shared my passion to raise its public awareness among Canadians.

This is unfortunate. Compared to other industry dispute resolution models, the CCTS appears to do many things well. For instance, the agency seems very accessible, has a simple process for complaint handling, and attempts to provide resolution in a timely fashion. In fact, PIAC advocated for an organization similar to the present-day CCTS 10 to 15 years ago. Apparently, what the CCTS does not wish to do is take any effective steps to measure awareness of itself – not now, and perhaps not ever.

This was not an easy conclusion to arrive at, but perhaps some history is in order. Back in 2011, the CRTC, which provides the CCTS with its marching orders, advised the CCTS that it expected measurements of public awareness and customer satisfaction in subsequent CCTS Annual Reports. The customer satisfaction figures were compiled and released by the CCTS. Meanwhile, in 2015, the CCTS advised the CRTC the collection of public awareness figures were not considered “closely related to its core mandate.” As a result, they were not collected by the CCTS from 2011 to 2015, and the CCTS appeared unconcerned about the expectation of the CRTC.

Other organizations with similar mandates, such as Australia’s Telecommunication Industry Ombudsman (TIO), have routinely conducted public awareness surveys. As a result, the TIO was been able to determine that in 2012 more than 33% of Australians said they would contact the TIO if they could not resolve a complaint with their service provider (unaided awareness). However, 2012 was the fourth time in 8 years the TIO measured its level of public awareness. Meanwhile, the CCTS apparently remained uninterested if Canadians knew it existed or not.

Fortunately, the CRTC noticed the lack of public awareness measurement data during a review of the CCTS in 2015. Shortly before the review began, the CCTS promised to undertake a public awareness survey in 2016. This offer appeared to be made at the last minute to satisfy the CRTC.

The CRTC, to its credit, recognized the lack of public awareness monitoring measurement, and the CCTS’s reluctance to monitor promotional obligations imposed on telecommunication service providers. Canadian TSP’s are supposed to promote the CCTS in the following methods:

Providers are obligated to advise customers of CCTS when discussing a complaint that cannot be resolved to the customer’s satisfaction
Providers are to mention the CCTS on monthly statements at least 4 times a year
Providers are required to post a notice about the CCTS on their website

However, without any effective deterrents, and with the CCTS apparently not enforcing compliance, telecommunications service providers felt free to ignore the CRTC-imposed promotional obligations designed to raise awareness to the CCTS.

As a result, since 2011 there has been a perfect storm allowing the level of unprompted public awareness of the CCTS to remain practically zero. A telecom regulator eager to delegate oversight of consumer complaints, a complaint resolution body apparently concentrating solely on resolving the complaints in front of them, and an industry disinterested in consumer concerns.

One would hope the CCTS got the message when the CRTC used bold font directing them to file the results of its public awareness survey upon completion. As well, the CRTC again expects the CCTS to measure the effectiveness of its Awareness Plan on an ongoing basis. However, if the contents of the recent public awareness survey are any indication, the CCTS remains hesitant to promote itself and has yet to develop a plan to ensure Canadians know they exist.

The survey itself was only 8 questions long. There was little in the way of detailed analysis and the survey questionnaire forms an unstable base from which to build any kind of useful comparisons going forward. This is unfortunate since complaint resolution providers who diligently collect comprehensive public awareness data are able to channel subsequent promotion efforts. For example, the Financial Ombudsman Service in the United Kingdom has noted, “We are very keen to work with groups of consumers who – according to research – are less likely to know about their rights to complain and about the free availability of the Financial Ombudsman Service.”

It was clear CCTS staff failed to consult with their counterparts from Australia who undoubtedly have gathered considerable experience after conducting multiple public awareness surveys during the past 15 years. For instance, the TIO awareness survey from 2006 produced over 30 pages of analysis, including results from small business customers, responses based upon ethnic groups, and response based on communications service. With only 8 questions, it is difficult to comprehend what, if any data collected will be useful for promoting the CCTS going forward.

The worst part is, the CCTS does a good job in helping Canadian consumers. PIAC likes what the CCTS does on a day-to-day basis and wishes more Canadians knew the CCTS was there for them. As a result, PIAC suggests the CCTS commission a third-party organization with considerable experience in survey compilation and analysis to undertake this public awareness research on their behalf on an annual basis. This solution liberates the CCTS from the burden of doing this research itself, while allowing it to be accountable and transparent in fulfilling in CRTC obligations. The CCTS may choose to spend some of its new-found free time enforcing compliance of TSP’s promotional obligations to raise greater awareness of the CCTS.

Without some sort of strategy, the CCTS will continue to be the Anti-Cheers – “Where Nobody Knows Your Name”

Jonathan Bishop is a Research Analyst at the Public Interest Advocacy Centre (PIAC)