MONTREAL – Groupe Aeroplan (TSX:AER) has changed its name to Aimia, a move that chief executive Rupert Duchesne says will attract more overseas investors to the increasingly international loyalty reward company.
“We expect as our revenues overseas increase, so will our investor interest,” Duchesne said. “We’d like to see more global investors in the stock, which will help us grow globally.”
About five per cent of the company’s investors are in Europe and Duchesne said he will be in the United Kingdom in the coming weeks to win more investors.
On Friday, the Montreal-based company’s stock ticker will be listed as TSX:AIM on the Toronto Stock Exchange.
The names of the company’s loyalty programs – Aeroplan, European-based Nectar and Air Miles Middle East – will not change, Duchesne said.
But Duchesne said there was some confusion about whether Groupe Aeroplan was still part of Air Canada – its former parent – and whether the company was just about the Canadian-based Aeroplan travel and gift rewards program.
“We think that the change of name will actually clarify who we are . . . a fairly diversified international company at this point, as opposed to what was the frequent flyer program from Air Canada.”
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Air Canada (TSX:AC.B) started Aeroplan in 1984 for its frequent flyers. The loyalty rewards program was later spun off as a separate public company in mid-2005.
Aeroplan contributes about 50 per cent of the company’s revenues but Duchesne said in the next five years, he expects that to go down to about a third of total revenues as other parts of the company grow.
In recent years, the company has acquired loyalty reward programs with partners such as grocery and home improvement stores in the United Kingdom, Italy and the Middle East as well as Canada. The company purchased U.S. loyalty marketer Carlson in 2009.
Aeroplan also owns a U.K.-based data analytics firm and is using it in the British Sainsbury supermarket chain and has paired with India’s Tata Group to launch a new loyalty rewards program in that country.
Duchesne sees growth ahead for Aimia in Asia, in countries such as India, and in South America, adding its important to diversify outside Canada.
“While this is a very stable economy by global standards, it isn’t going to grow anything like the rate of Asia or South America.”
He said that in tight economic times that loyalty rewards programs do well, noting that in the United Kingdom participants use their points to buy gifts or a turkey for the holidays.
“The same volume of rewards are taken in November-December as is taken the whole rest of the year,” he said of the British program.
“That’s where it’s really a substitute for cash.”
Duchesne said Aimia also will engineer its loyalty programs to attract the so-called Millennial generation, those generally in their 20s, as they come to replace the aging baby boomers as key shoppers and drivers of the economy.
Shares in Aeroplan were up three cents to $11.16 in afternoon trading Wednesday on the Toronto Stock Exchange.
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