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Bits: “AmEx Seeks to Weed Out Credit-Card Churners Chasing Rewards”, Marriott credit card returning?

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News in brief:

“AmEx Seeks to Weed Out Credit-Card Churners Chasing Rewards”

Bloomberg ran this headline last week.  The good news is that it focuses on the US market and not the UK market although presumably the sentiment is a global one.

The odd thing, though, is that American Express in the US has ALREADY done this and I’m not sure what else they can do.  In the US, sign-up bonuses on American Express cards are now strictly enforced as one bonus per card per lifetime.  And they stick to it.

Which means that phrases like this:

An increase in incentive bonuses has boosted so-called gaming by credit-card applicants looking for a quick reward, Doug Buckminster, president of global consumer services, said Wednesday at the firm’s investor day in New York. AmEx is using analytics to identify and “suppress” gamers, while creating offers that incentivize long-term loyalty, the company said.

… don’t really make sense.  The only thing Amex can do to encourage “the right sort of customer” is to cut sign-up bonuses, and it can’t do this because it is being trounced by the Chase Sapphire Reserve product in the market for premium customers.

“The right sort of customer”, of course, is someone who doesn’t care or realise that they aren’t getting decent value for the membership fee they are paying.  Increasing the membership fee for Amex Platinum in the US to $550 from $450 – and offsetting this with some Uber credit – is apparently the way to go.

This is the reality for American Express, of course:

American Express was battered last year after parting ways with its biggest co-brand partner, Costco Wholesale Corp., which accounted for 10 percent of AmEx cards in circulation. The lender also broke ties with Fidelity Investments. The firm trades for less than its 2014 closing price and slipped 0.7 percent to $79.04 Wednesday in New York.

There is still no word on whether Marriott will break the long-standing deal between Amex and Starwood following its takeover .  Back when I started in this hobby, the US version of the Starwood Amex was THE best card to hold and there must be a lot of high spending legacy customers at risk.

Amex American Express

Is the Marriott Rewards MasterCard returning soon?

The Marriott Rewards MasterCard, issued by Creation, has been unavailable to new applicants for over a year.

This is believed to be because Marriott does not have an FCA credit broking licence.  You can check this on the FCA website.  Ironically, I have a licence – Marriott didn’t need to withdraw the card, they could have let me be the exclusive promoter in the UK instead!

A reader pointed out that the website saying that you can’t apply has been changed.  The card which you can’t get now has a new design:

Marriott MasterCard

As it would be a bit odd to redesign a card which is unavailable – although obviously they are replacing existing cards as they reach expiry – this offers a glimmer of hope that the card may reappear at some point.  Note that there isn’t a ‘contactless’ logo there, which is my main problem with the current Marriott card and the main reason I have it linked to my contactless Curve Card.

It isn’t the most generous card in the world at 1 Marriott Rewards point per £1 but it is free to apply, it gets you Marriott Rewards Silver status and you get an ANNUAL loyalty bonus of 2,000 points just for keeping it.

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Comments

  1. Cuchlainn says:

    Waited 6 months and 1 day before reapplying for BAPP Amex ( referral from SWMBO, sorry Rob ) – acknowledged within 3 hrs, email re acceptance 3 days letter, new physical cards on day 5 post application and Missus 9,000 referral Avios in her BAPP Amex a/c 1 day later – fantastic service, as noted in follow up Amex survey email submission !!

  2. To be fair the plan behind giving points was to create loyalty from customers bringing in revenue. Now there’s a whole industry of people collecting points with the sole intent to cut back on that revenue. No names!

    🙂

    • …. and a whole industry of companies who run their loyalty programmes as a profit centre rather than a means of driving loyalty. Avios Group Ltd made roughly £135 million profit in 2015.

  3. RussellH says:

    Encouraging, even passively, churning seems crazy to me from a business point of view. When I had my business, it was the regular customers who paid the bills, while the occasional and one-off customers were the icing on the cake. Without the regulars I would never have been able to keep going.

    But, of course, the insurers have been actively discouraging regular customers for years, for some reason.

    Actually, I think Creation are going about it the right way with their Marriott card by giving an annual bonus. It would surely be better for them to increase the bonus each year to help keep cardholders. I have held the Marriott card since 2012. 10 000 points for the initial signup and £200 spend, then 2000 points a year – that will be a further 10 000 points by next week.

    However, I do not use the card as much as I could, partly because there just are not that many Marriotts where I might use them, partly because of Creation’s policy of ignoring all pence in the their points calculations.

    My credit limit on the card is £4 000, so an annual spend target of, say, £1 000 or £1 500 coupled with an increasing annual bonus, say 2 000 points after year 1, 2 500 points after year 2, 3 000 points after year 3 would surely be the way to keep at least some cardholders loyal.

    It seems completely bonkers to issue extra loyalty points by discouraging card loyalty!

    • Mr Dee says:

      Insurers would often issue renewal quotes for polices that were higher than you could get a new quote for, more to try and get the extra money rather than getting rid of the customer. It is a lot cheaper to keep a customer rather than get a new one which some big firms now focus on to keep their customers loyal.

  4. OT- Amex SPG Card + SPG Transfer

    1. Can I safely close my SPG account before first statement is generated? The points have shown up yesterday in my SPG Account.
    2. For SPG transfer to family member, I have a new account to which I want to transfer points to but I am few (3 or 4) days short of 30 days period with same household address. Is it safe to initiate transfer or must I wait for full 30 days before transferring?

    • 1. Yes
      2. I’d wait, because it will take a few days for them to reject it (if they are going to reject it) and you’ll end up taking longer than if you’d just sat out the extra 3-4 days

    • whiskerxx says:

      I have previously been asked to send proof of address when trying to transfer in less than 30 days. You might as well just wait an save the hassle.

  5. James123 says:

    O/T

    Can my Dad (who is a gold card holder) use the pay 2x avios for any flight availability option open to gold card holders to buy a ticket for me, or does he have to travel on the flight as well?

    • Nate1309 says:

      I’m fairly certain he can book you a flight. If he is part of a household account however I think you have to either be part of that or on his friends and family list. If he isn’t part of a household account I think there are no problems at all. I have never done this myself as I’m not BA Gold, but IIRC someone asked a similar question last week.

  6. The loyalty schemes that work for me are ihg and hotels.com. I avios a lot but they don’t do anything to keep me loyal – I just use them when that is the most sensible option. On the other hand i will always look to stay at ihg hotels even where others are cheaper, and if I don’t use ihg I am almost certainly booking via hotels.com. I don’t even bother with other sites because even if I send up spending more with ihg or hotels. Com I know I will get something back via the loyalty schemes and that’s enough for me.

    • That’s pretty much what I do re IHG and Hotels.com. I’ve been “having a fling” with Hilton since I got Diamond in a status match – if Spire offered similar status benefits I’d be totally loyal to IHG. I’ve got a pile of Avios I hardly use – working towards 2nd 241 which I’m not excited about. When I first got into this game I was very excited about it, now I just want a basic strategy which ticks over. Fair play to the Lego, Laithwaites, ink cartridges mob but it’s not for me.

      • the real harry1 says:

        Laithwaites is different to ink & Lego

        • If you say so. My point is I don’t actively chase avios. I also won’t turn them down either – I read the Sunday Times Travel Magazine anyway so I took that offer. It’s not a criticism.

  7. Don’t stick to just one company. Diversify!
    Try Ebookers!

  8. Graham Walsh says:

    IHG Promo through this morning

    5,000-14,000 points = 40% bonus
    15,000+ points = 80% bonus

    https://storefront.points.com/IHG-rewards-club/en-US/buy

    Not sure of targeted or not.

  9. the real harry1 says:

    O/T Avios @ Lego warriors – there’s a £1 Final Value Fee offer http://www.rsvp.ebay.co.uk/rsvp/signup/3286/C1fS-dWASW4
    just 12-13th March (Sunday/ Monday)

  10. Stuart says:

    Slightly OT but I remember reading on here previously about your partner referring you for the SPG Amex from the Gold PR Amex. Can anyone remind me how to do it or when the article / comment ran? Thanks

    • the real harry1 says:

      ISTR it was a choice on the email the referred person got from Amex – they could scroll down & choose

  11. Yes Sir says:

    There will be no sustainable co brand cards on VI/MC in Europe as the business model is not sustainable due to the Interchange rate reductions… Those companies which are still running them are being subsidised and will not work in the long term…

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