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MORE AMEX CUTS: Some sign-up bonuses and referral bonuses reduced, with immediate effect

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Last month American Express made some aggressive – and frankly confusing – changes to the rules regarding who qualifies for a sign-up bonus on its personal UK cards.  My summary of the Amex sign-up rule changes is here.

There are now further changes.  This time American Express has changed the sign-up bonuses and referral bonuses on some cards.

Which cards have changed?

The changes impact American Express Preferred Rewards Gold, The Platinum Card and the American Express Rewards Credit Card.

The changes were due to go live at midnight last night and are already in effect.

Change to American Express Gold sign up bonus

What are the changes to sign-up bonuses?

On Preferred Rewards Gold:

The sign-up bonus has been halved from 20,000 Membership Rewards points to 10,000 Membership Rewards points

The qualifying spend required to earn the bonus has increased from £2,000 within three months to £3,000 within three months

If you are referred by a friend to the card, you will receive a higher sign-up bonus of 12,000 Membership Rewards points (previously 22,000 Membership Rewards points)

On the American Express Rewards Credit Card:

The sign-up bonus has been halved from 10,000 Membership Rewards points to 5,000 Membership Rewards points

The qualifying spend required to earn the bonus has increased from £1,000 within three months to £2,000 within three months

On the American Express Rewards Low Rate Credit Card:

The sign-up bonus has been halved from 5,000 Membership Rewards points to 2,500 Membership Rewards points

The qualifying spend required to earn the bonus has increased from £500 within three months to £1,000 within three months

There is no change to the sign-up bonus or spending target on The Platinum Card.

What are the changes to referral bonuses?

With Preferred Rewards Gold:

The bonus you receive for referring a friend falls from 9,000 Membership Rewards points to 6,000 Membership Rewards points

The annual cap on referral points remains at 90,000 points

With The Platinum Card:

The bonus you receive for referring a friend falls from 18,000 Membership Rewards points to 12,000 Membership Rewards points

The annual cap on referral points remains at 90,000 points (if you refer 8 people, you only receive 6,000 points for the last one as you hit the 90,000 points cap)

There are no referral bonuses for the American Express Rewards Credit Card.

There are no changes at all, for now, to the British Airways, Nectar and Starwood card bonuses.

American Express Rewards Credit Card

What is going on here?

On the face of it, some of these changes do not make a lot of sense.  Primarily, why should you need to spend £3,000 to get the bonus on Preferred Rewards Gold when you only need to spend £2,000 to get the bonus on The Platinum Card?

I get a feeling that American Express is pulling back from its attempts to make Preferred Rewards Gold a mass-market product.  There is no other logical reason for pushing up the target spend to £3,000 in three months, which for Mr & Mrs Average is likely to be more than their remaining cash once housing costs and household bills are paid.

It is possible that the American Express Rewards Credit Card will be positioned as the mass-market product, although doubling the target spend to receive the sign-up bonus will also reduce the market for this product.

I am not really concerned about the changes to the American Express Rewards Credit Card, because the only reason a HFP reader should get this is to ‘protect’ your Membership Rewards points from deletion if you choose to cancel your Gold or Platinum cardI explain more in this article.

Is Amex risking long term damage by cutting off the ‘path’ for new cardholders?

My first American Express card, a long time ago, was a Gold.  Over time I progressed to The Platinum Card, and then – when it launched in 2004ish – the British Airways Premium Plus card, which was initially free to holders of The Platinum Card.

I suspect that – outside the world of Head for Points readers, who are well educated by our articles on the benefits of each card – most people start off with the free cards and then progress.  This is either as their income increases (so they can afford the annual fees on the premium cards) or as they become more comfortable with American Express as a partner.

Amex has now made ‘progressing’ less attractive.  For example:

if you start with the ‘free for life’ American Express Rewards Credit Card or ‘free for the first year’ Amex Gold, you are disqualified from the bonus on the free British Airways card or the Starwood card

if you start with the free BA Amex but decide that narrowing your focus to just Avios rewards makes no sense, you are locked out of the bonus on Gold, Starwood etc

if you start with the Starwood card but decide that Marriott Bonvoy no longer offers good value redemptions, you are locked out of the bonus on Gold and the free BA card

There are also no upgrade bonuses to persuade people to go from the free BA card to Premium Plus, or from the new credit card version of Preferred Rewards Gold to The Platinum Card.

American Express changing sign-up bonuses

And what is ‘the best starter card’ now?

HFP has generally promoted Preferred Rewards Gold as the best ‘starter’ card for someone coming into travel rewards.  This is because:

it had a generous sign-up bonus of 20,000 points (=20,000 Avios)

the points could be converted to a LOT of different rewards programmes, so you didn’t have to focus too early whilst you learned the ropes

you got your first year for free

you got two free airport lounge passes

you were free to earn a bonus on the BA or Starwood cards at a later date if you did choose to specialise

The situation is now different:

the sign-up bonus has been halved to 10,000 points (=10,000 Avios)

the target spend has been increased to £3,000 in three months

taking out Preferred Rewards Gold now blocks you from getting a sign-up bonus on a later date for the free British Airways card or the Starwood card – your only option for another bonus is the British Airways Premium Plus card

Overall, I am still tempted to say that Amex Gold is the best starter card for most people.  There is still a bonus, albeit lower, and the two free airport lounge passes will open your eyes to what your miles and points can do for you.  There is still no fee for the first year.

It is arguably better than telling people to start with the free BA Amex, which blocks them from both the Amex Gold bonus and the BA Premium Plus bonus.  In reality, the best ‘first’ card is probably:

The Platinum Card – but most people who are new to Amex won’t want to stump up £450, or

The Starwood Preferred Guest American Express card – because you can still get a bonus on both The Platinum Card and British Airways Premium Plus later, and you only need to spend £1,000 to trigger the sign-up bonus.  However, this is a confusing card for a beginner (even explaining why the Marriott card is called the Starwood card isn’t simple), it has a fee and the two cards you can upgrade to both have even chunkier fees which a lot of the market doesn’t want to pay.

The ‘keep it simple, stupid’ school of marketing is one which I have always believed in, but the current run of changes at American Express seems to be putting that to the test.

Important interest rate information

For the cards mentioned in this article, I am legally obliged to remind you that:

American Express Preferred Rewards Goldrepresentative APR 57.6% variable including the annual fee (free in year 1) based on a notional £1,200 credit limit.  Apply hereReview here.

The Platinum Card from American Expressno interest rate information as it is a charge card.  Apply hereReview here.

American Express Rewardsrepresentative APR 22.9% variable.  Apply hereReview here.

American Express Rewards Low Raterepresentative APR 9.9% variable.  Apply hereReview here.

The Starwood Preferred Guest American Express card –  representative APR 39.7% variable including the annual fee based on a notional £1200 credit limitApply hereReview here.

British Airways American Expressrepresentative APR 22.9% variableApply hereReview here.

British Airways American Express Premium Plus – representative APR 76.0% variable including £195 fee based on a notional £1200 credit limit. Apply hereReview here.

Disclaimer: Head for Points is a journalistic website. Nothing here should be construed as financial advice, and it is your own responsibility to ensure that any product is right for your circumstances. Recommendations are based primarily on the ability to earn miles and points and do not consider interest rates, service levels or any impact on your credit history.  By recommending credit cards on this site, I am – technically – acting as a credit broker.  Robert Burgess, trading as Head for Points, is regulated and authorised by the Financial Conduct Authority to act as a credit broker.

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Comments

  1. This is seriously poor. Amex is proving to be less and less value able by the day. As recent joiner to the hobby I’m an very disappointed with the recent wave of changes introduced by Amex.

  2. Charlie Matthews says:

    Do British Airways have any say at all when it comes to what Amex decides to do? I only say that as I do feel this could hurt BA, as apart from the mega wealthy and corporate travellers, I can’t see many people paying the sums of money for business or first class. Just happy i have got my first class return trip to Asia sorted in the new year on my companion voucher.

    Cheers

    Charlie

    • I wondered the same. Surely it puts less business BAs way.

      • I admit I was surprised that Amex is allowed to restrict who can get a bonus on the BA, Starwood and Nectar cards, since this clearly makes them less attractive and thus reduces applications. Which makes me think the end is nigh …..

        • Another company is surely likely to pick up the BA 241 idea? It after all is the most valuable perk for any reward card in the uk as often said on this site. Even amex could potentially keep it, but under new contract rules.

        • Hector says:

          Didn’t Amex recently resign Delta in the US to a long term partnership/ co-brand relationship?

        • Yes

        • The paid cards for that partnership also earns the equivalent of tier points i believe…

  3. Would a Gold/Platinum cardholder receive the referral bonus if they refer one of the Amex cashback cards?

  4. Michael says:

    At least 20k MR’s to upgrade to Platinum still stands! I did this last week. That will probably be next mind.

  5. James A says:

    Real shame. The loyalty game only gets less lucrative over time.

    I really like Amex as a company but they have made changes that basically force me to change loyalties if I ever want to see a bonus from Amex again. Bizzare.

  6. As a Platinum card holder would I get a referral bonus if my husband took out the SPG Amex?
    He used the referral link I sent him in January and he has hit his target spend to get a bonus points but I have not received anything.
    I intend on closing my account before the weekend as I haven’t jad £450 worth of benefits but I wondered if I would miss out on the referral membership rewards and how long they are likely to take to appear

    • If you’re eligible (up to 5 referrals per calendar year), you should get the points around the time the card arrives. You need to contact Amex but may have to prove your husband used the link.

      • Crafty says:

        I wouldn’t suggest complaining when you’ve referred your husband. You missed out this time – unlucky, better luck next time.

  7. callum says:

    “On the face of it, some of these changes do not make a lot of sense. Primarily, why should you need to spend £3,000 to get the bonus on Preferred Rewards Gold when you only need to spend £2,000 to get the bonus on The Platinum Card?”

    Because The Platinum Card is the premium level and they want it to be more rewarding than Gold?

    The Gold card will also never go mass market. A £140 annual fee when the average card has a fee of £0 will always prevent that from happening.

  8. John C says:

    What is Amex’s strategy here? it sounds like it is being run by a private equity manager who is trying to slash any benefits for a new customer to take their first Amex. £3,000 for 10,000 points is ludicrous. Has anyone got any thoughts on this? I will personally focus on Virgin cards going forward.

    • Given that Amex pays 1p per point if you redeem into Avios, it is still financially unviable.

    • Shoestring says:

      what else are you going to get for your £3000 spend? 0.5% cashback?

      I’d rather have 10K MR points

      • Peter K says:

        It’s those who could force spend too hit the £2000 target (some I have referred are like this) but wouldn’t ever be able to make £3000 that this would hit.

      • the_real_a says:

        But – if you extrapolate that out. 90k points is £450 (@0.5% cashback) plus the £750 taxes/fees/charges on redemption’s = £1200

        Considering the reward availability your benefit over a sale fare is now marginal.

  9. Geoff Martin says:

    I wonder how will this affect me? I applied for the Preferred Awards card last week and it was approved on Friday 12th April, though the first time I received a notification which included the account number was, perhaps tellingly, this morning!
    Suspect I’ll only get the 10,000 membership Rewards?

  10. Qwerty Bertie says:

    Couldn’t see any mention of it anywhere; it is now 6k MR instead of 9k MR to refer from a gold…

  11. Cookoovaya says:

    Hi Rob. Should we expect any changes to the BA cards?

  12. Hardik says:

    Its not Amex fault – its the fault of the European Regulation and the poor European banks – not even a single one has a premium credit card for rewards. It puzzles me to see that credit cards offers in europe are all about the 0% you get for first few months. The banking sector needs to seriously think of the void which has been created here. If banks start offering a competitive product, Amex shall have no option but compete in the market. Look at virgin money – they got really good customers with the atlantic cards.

    • Well the name holds a clue: “credit” cards are supposed to be about borrowing money.

      Maybe the name should be changed to “reward cards”.

  13. Oarar80 says:

    I think Amex need to start concentrating on loyalty over worrying about card churning. Recent changes have killed that and these changes are further reinforcing it. This feels like positioning the higher value cards better (Platinum and BAPP) so they look super attractive when you look at an overview online.

    Sky do an interesting loyalty scheme where you are rewarded more for the years you have been with them. For cards like the platinum and the gold with Amex it would feel better if you got more benefits or MR points for years with Amex. Use that “member since” number!This stops you feeling like cancelling to churn (wait 2 years) or go elsewhere. It makes the customer feel special and exclusive for being with Amex over time – which feels like a brand value of Amex. A bigger more stable base means they can persuade more shops to sign up to Amex too in the Uk.

    A good example on Gold might be have extra 500 MR points per card membership year, with an upper cap. Could also do a bonus on top of this for tiered spend (ie, on gold card, spend £20k a year and get an extra 5000). Or even a different earning rate of MR points. A simple thing might be to offer additional free lounge visits via Lounge Club for certain number of years. In other words give us targets and goals linked to length of time with the card – make it feel great to be with Amex over time.

    I think for Gold too they need to just a little more to make it long term keeper after 1 year. I think the sweet spot is 15k MR points for spending £15k. At the end of the day a regular person who likes travel has a choice to make – a card like this, or for a bit more money the BA, Virgin or IHG cards. It’s in competition. For me, I have a choice to make (I spend about 15-20k through cards a year) – and it’s near run thing between all these cards at the moment.

    It’s interesting cards like BA haven’t been touched in all this. Either they are running out of contract and Amex are bound to this with BA, or this is still a long term serious card for Amex.

    • Qwerty Bertie says:

      I like the sound of your time-based loyalty idea. That really would be a genuine way of encouraging loyalty.

      Nationwide does that with the interest rates on some of their accounts. Very boring in the climate of the last decade, but still it’s a nice principle.

      Amex could take that up but make it hot and spicy! Give an accumulating birthday bonus starting in year 2 for example, or a general ‘being an Amex customer regardless of cards held’ annual bonus starting in year 5 etc.

    • Good ideas. I suggest you put them into a covering letter when you send your CV to Brighton.

    • Crafty says:

      Very good suggestions. You should write to them and suggest they employ you in their loyalty team!

  14. A while ago I was invited to an online survey (can’t recall if it was BA or Amex or joint) and quite a few questions were around whether I’d be ok dropping the earning rate and some of the bonuses if the card gave me an airline status instead. Not a churner myself, I am hoping these changes will be followed by some new benefits (OW Sapphire/Emerald would be more than welcome).

    • Alex W says:

      If it happens it will be Ruby/Bronze without any Tier Point credits to get you any closer to Sapphire/Silver. In other words it’s likely to be completely useless for anyone except a total newbie.

      • I agree no tier points would be given making it easier to progress up the tiers faster – However i can see Silver / Sapphire being a more likely status – BUT as a “card holder status” so you potentially have slightly different perks when flying OW opposed to BA metal or vice versa

        • This is the way the US market has gone. Affinity CC card holders get a free checked bag (except on the ‘basic’ fares), boarding priority after elites but ahead of the rest of the hoi polloi, and sometimes a discount on BOB catering. Overall not a bad package for, say, $95/year, easily enough to drive customer loyalty (eg, free checked bags on the summer holiday for a family of 4 will more than cover the annual fee just on the outbound alone) even before taking into account the points earned.

  15. Brighton Belle says:

    It used to be that Amex appealed to the corporate spenders and buyers of Rolex glitter. Then they moved to the Ford Escort crowd to expand their presence. We got to fly on planes to Malaga. Package holidays for all and now recently, even a taste of the pointy bit of the plane rather than in row 55 with the smokers and toilets.

    So back to row 55 for me but at least the smokers have gone.. so I suppose that’s progress and Jet Blue and Norwegian are a passable enhancement on Laker Skytrain.

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