AMEX may be limiting the ability to get sign-up bonuses more than once per lifetime per card

Discussion in 'American Express | Membership Rewards' started by miles and smiles, Mar 11, 2014.  |  Print Topic

  1. miles and smiles
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    miles and smiles Gold Member

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  2. newbluesea
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    newbluesea Gold Member

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    Not surprised ( not at all unhappy about this) the current abuse of CC bonuses has got to stop. The avalanche of miles/points flooding the system and those of us who use the cards for the purposes they were intended are at a distinct disadvantage relative to the 20 cards every 3 months churners.
    As a regular HH or SPG stayer it often takes multiple stays to accumulate the amount of points a churner (whose only loyalty is to their own greed) will amass by even a single churn.

    I can only hope other card issuers follow suit.:)
     
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  3. pointshogger

    pointshogger Silver Member

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    Easy to feel conflicted. Of course as a consumer I want to rack up as many miles and points as possible. But if that results in diluting the value of each point, then it is probably not worth it in the long run. There is always a trade off. But in the end, I think it is better that each point is more valuable, rather than the dilution, so I am leaning towards supporting such a move by credit card companies.
     
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  4. Zomby Woof

    Zomby Woof Silver Member

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    People wouldn't be churning as much if AMEX provided better loyalty bonuses for current card holders. Bonuses could be tied to spend yearly/cumulatively and length holding the card. Would be nice to have some staggered loyalty bonus without having to spend $40K (e.g. getting Hilton Diamond).
     
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  5. pointshogger

    pointshogger Silver Member

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    Great point. There would be less of a need for churning of credit card companies would give more annual spending bonuses for retaining the credit cards.

    Furthermore, I would add that annual fees are painful too. It may be attractive to sign up for a credit card when the first year annual fee is waived. It might not be too painful to pay the fee the second year, but beyond that, the fee can really add up.
     
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  6. Zomby Woof

    Zomby Woof Silver Member

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    Eliminating the annual fee could be one of the loyalty bonuses. Spend $X and no fee for the next year. Spend $N for as long as you've had the card and eliminate the annual fee for as long as you own the card.
     
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  7. newbluesea
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    newbluesea Gold Member

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    Fair enough.. perhaps Amex should go the route of giving an annual bonus like the free night certs one gets with say the Marriott or Citi Hilton cards.
    But I can understand the annual fee charge because some will just keep the card not use until some promo comes along and from the card issuers point of view
    open (but not being used accounts) have got to be a losing proposition.
    But you cant please everyone getting HH Diamond for my Surpass is the best feature from my perspective especially when you can with a little careful planning get a full 2 plus years status.:)
     
  8. pointshogger

    pointshogger Silver Member

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    There are so many creative ways that credit card companies could come up with. How about, if we spend more than $10,000 a year on our credit card, then our annual fee will be waived? There are so many incentives that can be created to encourage consumers to retain the credit cards.
     
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  9. wombat18
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    wombat18 Silver Member

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    Yep, I put over $17,000 on my AMEX Delta card last year and didn't get any bonus. They didn't even ask why I was cancelling.
     
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  10. pointshogger

    pointshogger Silver Member

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    Sometimes I feel like they don't even care if we cancel. And it seems like they rather us just churn the credit card instead.

    Or maybe they feel that it is not worth their time to try to convince us to stay. Maybe they are making too much money to care about us.
     
  11. bigx0

    bigx0 Gold Member

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    If we churn a card and get a new bonus of, say, 50K SPG (or DL or HH etc.) points, who's "paying" for those internally? Amex or Starwood? If it's Starwood, sure, Amex doesn't care if we churn. But then shouldn't Starwood make the churning rules and not Amex? Or perhaps Starwood "pays" but gets some of the annual fee in return?
     
  12. pointshogger

    pointshogger Silver Member

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    Either way, someone is paying for it and the overall costs is always going to be more expensive to start a new account than to continue an existing one.

    Whoever is footing the bill does not seem too bothered by it.
     
  13. newbluesea
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    newbluesea Gold Member

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    Not sure I agree with the last sentence.... if whoever the cost goes back to didn't seem bothered we wouldn't have this change would we?:)

    I am pretty sure that the loyalty program lets use SPG for example sells their points at a reduced rate to Amex who in turn offers the card to attract members of the SPG program and the hotel gains by having guest who have the card giving preference to that chain when they decide to stay at a hotel
    When some-one gets 30k points for charging $1500 on a card even if Amex is paying 0.005 (half-a-cent) per point = $150.00 there is no way could this be profitable for Amex.
    Churn the card and Amex would need another card holder to carry a substantial balance to break even.

    Then there is SPG if the card holder only stays at their property using the points earned they also lose out in the deal ...we should remember some of the cards carry status benefits.
     
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  14. NYCUA1K

    NYCUA1K Gold Member

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    I was booed here shortly after I joined this board and opined that I found the practice of "churning" to be counter-productive to what most of us in the mile/point business were trying to accomplish. In addition to flooding the system with points/miles that may have contributed to the recent waves of "devaluation", the exercise seemed to me to be ultimately futile and doomed because it could not possibly be sustained ad infinitum -- either by the consumer or CC companies.This move by AMEX, which I think is a Good Thing, may be bearing out that prediction.
     
    Last edited: Mar 11, 2014
  15. LETTERBOY
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    LETTERBOY Gold Member

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    I see nothing wrong with American Express deciding that it doesn't want people to treat them like an ATM machine for frequent flyer miles. They probably want people to keep their cards, rather than trade them in like they're playing draw poker with them.

    And before anyone says that if AmEx wants that to happen, they should offer more bonuses & incentives - they will, if they think they need to. They're likely trying to see if this has any effect first.
     
  16. gconnery

    gconnery Silver Member

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    Interesting, this thread isn't taking the tack I might have expected.

    Personally I'm disappointed by the change. And yes, I've done relatively well churning cards.

    If you're trying to get rid of all the points devaluation how about:
    - get rid of all the credit card signup bonuses completely, even for the first time around
    - completely shut down all MS opportunities. get those registers coded to only accept cash from now on for example.
    - actually while we're at it, how about eliminating all miles/points accumulated by any method other than hotel stays/BIS miles? why should credit card spend count at all?
    - and while we're at it, all airlines/hotels should move to a revenue-based model like Delta or Southwest since we don't want people mileage running anymore. Certainly BIS miles count more than real miles but those freeloaders getting status and free flights off cheap tickets shouldn't count. If you're buying expensive tickets you should count a lot more than those guys.

    Etc. Where do you stop? Honestly, those 25K SPG points per year on a churn aren't a large proportion of the Starpoints I earn each year, but I consider them a nice perk. I mean a 5-night stay in Hawaii in a basic room cost 48,000 points before the recent devaluation. Stay 2 weeks and you're into a couple hundred thousand SPG points. 25,000 points is nice but it isn't a game changer.

    Now personally I get a lot of miles by staying at actual SPG hotels. But I also get a bunch through MS on the Amex SPG card, which Amex might not be inclined to stop since they make money in the process. And those additional SPG points are still going to devalue things...
     
  17. NYCUA1K

    NYCUA1K Gold Member

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    Where to stop? I am longing for the relative simplicity of old!
     
  18. HaveMilesWillTravel
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    HaveMilesWillTravel Gold Member

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    What I'd like to see:

    Higher rewards for those who actually use the card. Funded by eliminating churning and hawker referral fees.
     
  19. gregm

    gregm Gold Member

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    That's funny because I have totally different outlook. I like the bonuses over the Elite airline status, etc. I earn my status with my own actual miles. My Amex is my wife's FF#. (Not a churner, either. Before MP, never even hear that term :rolleyes:) I guess I just feel jealous because others get a CC benefit I have to earn.:mad: Oh well.
     
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  20. ariosto

    ariosto Silver Member

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    Well said...
     
  21. gregm

    gregm Gold Member

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    There's the evidence they just don't care. That's screwed. No customer retention effort?
     
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  22. newbluesea
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    newbluesea Gold Member

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    Why do you need to get customer retention? It either you want to keep the card for the benefits you signed up for or not. A couple thousand miles thrown at me doesn't mean that much to me if I don't have a specific need or want to carry any given card.

    One thing being forgotten here is that on the whole Amex cards ( and/or the programs they are affiliated with) allows you much greater flexibility in moving points/miles around into a large number of other programs and the points awarded for spend are often much higher than say Chase which is their major competitor.

    My Chase Marriott Visa gives me 2 points for dining and precious little else unless I stay at a Marriott... compare that with the HH Surpass Amex for example where I get 6 points/$ at restaurants, gas stations and supermarkets
    And before you tell me that points have different value I just redeemed three nights at the Marriott Rome Flora (Marriott's top property in Italy) at 80k points/night and I could have stayed at Hiltons Waldorf Cavalieri for 60k points per night.
     
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  23. gregm

    gregm Gold Member

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    I just meant when @wombat18 canceled, they didn't even ask why or try to retain him as a cardholder.
     
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  24. newbluesea
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    newbluesea Gold Member

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    No worries ....my response was actually more directed generally at people who seem to need a retention bonus to retain a card .,.. should have made my point a little clearer and not include your quote:)
     
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  25. Wandering Aramean
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    Wandering Aramean Gold Member

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    If they've determined that the cardholder is not a profitable customer to them then why should they try to retain them?

    AmEx in particular is not too aggressive about underwriting consumer credit so cutting back may be part of their overall strategy.

    As for who pays the sign-up bonuses, that's on the banks. Customer acquisition is expensive. And unless you continue to generate positive cash flow for the banks it is quite likely they'll be ready to shun you. And there can be conflict between a program and a bank if the acquisition costs are too high to the bank and the take rate from consumers is also higher than expected. Increased up-front costs to the banks can sour a relationship with a program quite quickly.

    I do find in interesting that gleff - a man who has said in recent years that CC sign-up bonuses are the key to miles/points-based travel - says this "isn’t really a big deal though." Apparently it is OK because Chase has a similar policy. Except that Chase has a ton more cards so more churning is possible. But why pay attention to that little detail?
     

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