WestJet introduces frequent flyer programs

Calgary-based WestJet Airlines has unveiledtwo long-delayed frequent-flyer programswith Royal Bank of Canada and MasterCard.

The programs were supposedto be introduced last June, but were put on hold until kinks in WestJet's new reservation system could be worked out.

Theairline is offering two different Royal Bank of Canada-branded MasterCard reward programs, through which cardholders can earn WestJet dollars on purchases.

One offers rewards of 1.5 per cent in WestJet dollars, as well as travel insurance, hotel discounts and upgrades for an annual fee of $79.Another earns cardholders one per cent back in WestJet dollars for an annual fee of $39.The WestJet dollars are used to reduce fares. There are no points, blackouts or seat restrictions.

"It's been a long time coming," airline analyst Rick Erickson told CBC News. "We've been watching and waiting for WestJet to do this for three or four years."

With the plan now in place, he said, "WestJet's going to be in a position to earn quite a bit more incremental revenues."

"Everybody realizes the strength of loyalty programs," Erickson said. "They do work."

"These programs are designed to be simple, open and transparent," Lauri Feser, WestJet vice-president of marketing, said in a release.

"Canadians want to be able to understand the way their rewards are calculated, and they don't want to worry about whether they have enough points to do what they want.

"For the frequent business traveler, our research indicates there is strong appeal for the rewards offered by this type of program," she said. "Most of all, they want to be able to use their rewards without blackout periods and other restrictions."

Air Canada's loyalty program, Aeroplan, has more than six million members. CIBC's AeroGold Visa card is the most popular travel rewards credit card in Canada.

WestJet's program is meant to be fairer than many other frequent flyer programs by discriminating between passengers who book well in advance and get a better price than those who pay more because they have to book at the last minute.

"In this case, WestJet is doing something very smart," said Erickson. "They're basing their plan on the amount of money spent, not miles flown."