• Graham

Mixed-Cabin Awards: A *really* deep dive with Aeroplan's Mark Nasr

First, a warning: if you're interested in the nerdy details of how the new Aeroplan search engine works, you'll love this post. If you don't legitimately enjoy detailed discussions of fare buckets and booking classes, well, not so much.


I'll be mixing city names and airport codes - if you haven't memorized your IATA codes, this will help.


We've talked a lot about the new Aeroplan award-booking system since it launched in November 2020; the good, the bad and the hard-to-explain. This week, I've had the opportunity to get *way* into the details with one of the architects of the new program, Air Canada's Vice President, Loyalty & eCommerce, Mark Nasr. He gave me some interesting background on the goals for the new program, but mainly I bombarded him with questions on how the new search engine thinks, why it shows the results it does, and particularly what to expect when you see the dreaded "mixed cabin" tag on a premium-class award.


Let's get started!


First off - from AC’s point of view, they’re still fine-tuning the search engine, from things like which criteria are used to sort the initial results of a search, to how mixed-cabin awards are displayed, to how many different options are displayed for a given itinerary. This doesn’t sound like substantive changes to pricing, it’s mainly about them trying to strike a balance between showing a good range of options, while also recognizing that people searching Toronto-Vancouver probably *don’t* want to be shown six different options to connect through Winnipeg and Regina.


We spent a lot of time on the example of Toronto-Vancouver-Sydney (YYZ-YVR-SYD), mainly because it’s a solid example of what happens when mating up domestic inventory with international on two high-demand routes. Point is, I use that example a lot here, but the general principles apply similarly to something like Vancouver-Montreal-Paris or Atlanta-Toronto-Dubai.


I mentioned the frustration a lot of Aeroplan members are feeling when YYZ-YVR and YVR-SYD are each bookable separately, direct, in business, but results for YYZ-YVR-SYD combined, forces a mixed-cabin itinerary or simply omits most of the available options to put the domestic leg in J.


Nasr notes that his team is currently looking at how the search engine handles which domestic options to show on domestic-international connections - for example, what length of layovers are shown, and how the search-engine decides which options are worth showing and which ones aren’t, on the assumption that nobody really wants to be offered YYZ-YWG-YYC-YVR-SYD.


He also noted that if you see an 8AM YYZ-YVR available, which the website won’t let you combine with a 23:55 departure YVR-SYD, you can call Aeroplan and have an agent piece these together, at an updated joint cost that’ll recalculate depending on what you’re combining.


Phone fees will apply for new phone bookings, so this method isn’t free. It sounds like they’re exploring adding similar functionality online, but Nasr said it’s too soon to give that an ETA.


I asked about the possibility of adding an option to let users filter out search results for mixed-cabin awards where less than X% of the award is in the desired cabin. The answer I got wasn’t a hard no, but he noted that a key reason they haven’t done this in the new system is that mixed-class options now have the option to up-sell to a Flexible, non-mixed version of the same award.


One more time: if you see a mixed-cabin award in Business Lowest or PE Lowest, switching to a Flexible award will move all AC-metal flights into the desired class.


So, how does that pricing work?


Now that award tickets now have an analogous relationship to fare buckets, award space on AC metal is no longer as simple as “i_space=yes” like it was in the old system, though partner space still is.


"What's a fare bucket?", you might reasonably ask - the very short version is that while airlines usuallly offer 'standard' and various 'flexible' types of Economy, Premium, Business etc. fares, each of these is also split into fare levels. For example, let's say there's 100 Economy seats on a plane; there might be 10 offered in a very low "deep discount, buy >60 days in advance" bucket, then 10 more in a "slight discount, buy >14 days in advance" bucket, and so on, until the last few Economy tickets still available at the last minute are highly expensive. This is part of why a close read of your ticket will probably show you as booked in "Economy Flex U" or "Business P".


These are only examples, and the science of determining how to allocate seats to each "bucket" to account for things like seasonal demand, is a leading source of employment for advanced mathematicians and AI programmers. No, seriously.


Coming back to award tickets, here's why this matters: because Aeroplan now offers "every seat, every flight" to be booked with awards, they can't just sell every seat at the base price, and this is where the 'variable pricing' model comes into effect.


In practice, this means that if you see a YYZ-YVR flight at 100,000 points in Business Lowest, while YVR-SYD later that night, shows up at 78,000 in Business Lowest, that specific YYZ-YVR flight is probably available in a relatively high ‘fare bucket’, etc., while the YVR-SYD leg is probably available in a relatively low ‘bucket’.


So, that example is likely to show up in the search engine as a “mixed class” YYZ-YVR-SYD award in Business Lowest, with YYZ-YVR in Economy or Premium Economy, and YVR-SYD in Business, because the search engine is tuned to show Business Lowest results that represent the lowest possible award option that has at least some of the itinerary in Business Lowest.


...but switching to Business Flexible will move the whole award into Business, and also move the whole award into the refundable/changeable terms and conditions, and include access to the Signature Suite on international awards out of YVR / YYZ.


Coming back to my question about the option to filter out mixed-cabin search results, Nasr noted: "just for example, you might filter out a trans-Pacific [award] that’s 15% business for 70,000 [points], when the 100% business might be 82,000. Why would you want to do that?”


Point is, in the new system, Aeroplan are really hoping that you’ll check out the “business flexible” option before giving up on a mixed-cabin fare.


I tried a bunch of sample searches, and the one pictured below is reasonably representative, though obviously there are going to be outliers. The price difference between Business Lowest and Business Flexible looks like it’s a bit more than the difference between an all-Business-Lowest award departing at 18:00, and the mixed-cabin-Business-Lowest version of the 20:00 departure I’ve highlighted.


Pricing below is for a 75K with a premium credit card.



Seems complicated? Yeah, a little.


From AC’s perspective, this is driven by availability. From the passenger's perspective, if we're all being honest, there was never a realistic world in which every business-class seat was going to be available at the lowest-possible award level.


The plus side here is that you’re no longer stuck looking at week after week where mixed-cabins are the only awards available, and you’re no longer stuck paying through the nose just because a short connecting leg is high-demand in business class.


The idea here, Nasr notes, is that if you’re flying Ottawa-Montreal-Paris, and the rush-hour Ottawa-Montreal leg is only available in business in a high fare bucket, or only flown by a Q400 with no business cabin, many people will happily take that first 24-minute flight in economy rather than pay tens of thousands of extra points to push the whole award into Business, or reroute through Toronto. For this reason, the mixed-cabin option is now offered instead of just assuming you want to pay the higher cost. Given how often I used to hit a snag booking round-the-world awards, where 13 out of 14 global segments were available except for YOW-YUL, this is a reasonable point.


Unfortunately, this does also mean we're likely to keep seeing search results like Toronto-Newark-Cape Town, where the 90-minute Toronto-Newark leg is in Air Canada business and the 14-hour leg to South Africa is in United Economy. A bit annoying, but not the end of the world.


Nasr also notes that on mixed-cabin awards where the lower segment is operated by Air Canada, the cost of that segment will be pro-rated accordingly. On the upside, the old program charged full business price regardless of how much of the trip was actually in business; on the downside, the new rules no longer automatically put mixed-cabin passengers on the gate-upgrade list. More on that below.



Upgrading mixed-cabin awards


Any mixed-cabin segment on AC metal (ie - if "Air Canada" is written on the outside of the plane) is eligible for eUpgrade just like any other Economy or PE award. I asked if there are specific rules about which exact fare type mixed-cabin awards will book into, and it sounds like they won’t set long-term policy on that until they have more data on booking volumes and behaviours, so for now, mixed-class segments are assigned fare classes (and presumably priced) based on availability in each case. If I get more info on that, I'll update it here.


If you book a mixed-class award, you will no longer be waitlisted for upgrade at the gate on the mixed segment. Unless you eUpgrade, the class on your boarding pass is the class you’ll sit in.


If your whole one-way bound is booked entirely on partner airlines (no Air Canada segments), the old rules still apply to upgrading mixed-cabin awards: if business-award space opens up, an Aeroplan phone agent can move you up to business. As before, there may be additional taxes and fees associated; for example, a flight out of London or Paris is taxed based on cabin class, so upgrading those segments will likely cost you extra taxes, but on fixed-price, all-partner awards, no additional points will be charged. If the one-way bound includes any AC metal, and therefore has pro-rated pricing, then upgrading a partner segment *may* re-price the whole thing.



A few notes on timing for connections and stop-overs


All domestic and Canada-to-US connections are normally limited to 4 hours or less, but there’s currently a COVID exemption bumping this up to 10 hours to account for lower flight frequency. All international and Canada/US-to-international connections are limited to 24 hours or less.


For example: on YOW-YYZ-YVR-HKG-SIN, the YYZ stop must be 4 hours (currently 10) or less, while the YVR and HKG stops must each be 24 hours or less.


In this example, you can pay an extra 5,000 points (and book by phone) to add a stop-over at HKG of as long as you’d like, but the stop-over option is not available within North America. When I asked whether the North American stop-over option might return in the future, Nasr made a point of saying he “can’t make a commitment on North American stopovers right now”. Which I’m reading as “the answer isn’t yes, but it isn’t no yet either."



Final thoughts

I’m not sure how I feel about all of this yet.


Honestly, if I ran this same YYZ-YVR-SYD search in the image above, and saw a “Business Lowest” award for that 20:00 departure priced at 94,100 points as the first result, I'd probably think that was a reasonable price, considering the same route used to be fixed at 80,000 plus a ton of fees - and the YVR-SYD leg was often impossible to find in Business.


…but when I see the exact same thing offered to me at 94,100 points as an up-sell to Business Flexible, my first reaction is to feel a bit bait-and-switched. And I don't think that's me being terribly fair.


I can recognize that’s not a terribly rational reaction, but that doesn’t make it any less true. I can clearly recognize that this works exactly like cash prices have for years, and that that's exactly what Aeroplan has told us to expect for months now - but that doesn’t make me happier about it.


If I step back and look at it rationally, it’s honestly pretty reasonable. The only reason I’d actually refuse that 20:00 departure is that I’d be more likely to take the same deal at the same price for the 19:00 departure, since a Business Flexible fare would entitle me to dinner at the Signature Suite at YVR on my connection.


Really, what it comes down to is the fact that this new program is an absolute gold mine for someone with a huge supply of points that gets topped up on a regular basis, where an extra 15,000 miles for a confirmed upgrade and a nice dinner isn’t a big deal. For others, those extra 15,000 miles are worth hundreds of dollars, and the best thing about a layover at Vancouver is going to be stopping into the Domestic terminal for a ten-dollar lunch at the new Japadog that'll be opening there in early 2021.


Taking a fair look at the whole picture, Aeroplan's doing what they said they would do here, plus a little more. There are still some questions about the relationship between the published "what to expect" award chart and the actual prices we're seeing on some high-demand routes, but that's already starting to show improvement since launch.


If you've read this far, congratulations, you're a *huge* nerd. I hope this has been helpful, feel free to contact me with any questions!


Safe travels!

- G


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