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Porter targets Air Canada customers with offer to match Aeroplan loyalty status

Aeroplan customers have until Sept. 6 to apply to transfer to the VIPorter loyalty program

TORONTO, ONT - JULY 4: Ramp staff unload luggage from a Porter Airlines airplane at Billy Bishop City Airport on July 4, 2022, in Toronto, Ontario, Canada.  (Photo by Gary Hershorn/Getty Images)
Porter Airlines is trying to woo customers from Air Canada by offering to match Aeroplan status through its own loyalty program. (Photo by Gary Hershorn/Getty Images)

As competition in the Canadian aviation space tightens, Porter Airlines is trying to woo customers from Air Canada (AC.TO).

Porter says it will match the loyalty status for Air Canada's Aeroplan Elite Status customers, giving them the equivalent status in Porter's VIPorter loyalty program. Porter will also offer status in its loyalty program based on the number of flight segments Aeroplan customers who don't have Elite status have flown this year.

Customers who successfully apply to transfer to VIPorter will receive the status for the remainder of 2023, and the qualification requirement to maintain the membership level through 2024 will be reduced. Aeroplan customers have until Sept. 6 to apply.

Porter executive vice-president and chief commercial officer Kevin Jackson says the airline is hoping to lure frequent fliers over to its loyalty program.

"We want to highlight for frequent travellers the value proposition that VIPorter provides, certainly relative to our competitors in the marketplace," Jackson said in an interview with Yahoo Finance Canada.

"We have a very aggressive loyalty program... whether it's a basic economy fare, or a standard fare on Porter, its full (loyalty credit) for the fare, and that's unique."

Porter offered a similar status match earlier this year for WestJet Rewards customers. While Jackson would not disclose how many customers signed up for VIPorter, he says it exceeded the company's internal goals by five times.

Porter is in the midst of an expansion plan that includes expanding its fleet to 79 aircraft by 2025. It began flying out of Toronto's Pearson International Airport in February, and has since expanded its destination list to 25 cities.

Domestic competition in Canada's airline space has ramped up since the pandemic, with new carrier Lynx launching last year, and Porter and Flair Airlines undergoing significant expansions.

The increased competition is expected to put pressure on domestic profitability for Air Canada, the country's largest airline, although analyst Cameron Doerksen said in a research note earlier this month that "the more important driver for Air Canada's profits is its international franchise where industry capacity remains rational."

"We also believe that the domestic competitors will face constraints on their growth that Air Canada will not, including capital and availability of pilots," Doerksen wrote.

Aeroplan is a key component of Air Canada's customer loyalty strategy, and has grown at record levels on all key metrics, according to the airline. The company recently unveiled new and expanded partnerships for the Aeroplan program with Bell, Parkland and Uber for groceries. According to Air Canada, the region where Aeroplan is growing fastest is the United States.

"The program has grown significantly from the point at which we took it over, and we're seeing that growth contribute both (to) top line (growth) and profitability," chief financial officer John Di Bert said on Air Canada's most recent quarterly conference call earlier this month.

This is how Porter will match Aeroplan Elite status:

  • Aeroplan 25K will receive VIPorter Venture

  • Aeroplan 35K will receive VIPorter Ascent

  • Aeroplan 50K and above will receive VIPorter First

For matches based on the number of flight segments:

  • 5 flight segments will receive VIPorter Passport

  • 8 flight segments will receive VIPorter Venture

  • 16 flight segments will receive VIPorter Ascent

  • 28 flight segments and above will receive VIPorter First

Alicja Siekierska is a senior reporter at Yahoo Finance Canada. Follow her on Twitter @alicjawithaj.

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