The Real Reason Amex “Enhanced” Their Platinum Cards & Why It Isn’t Enough!

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Amex Platinum Changes

The other day I was flying on Cathay Pacific from Tokyo to Hong Kong. Towards the end of the flight, right around the time the airline disengaged the IFE system, I looked over to the magazine rack where I found the latest copy of Bloomberg Business Week. I was excited, because it contained the latest article on Sapphire Reserve. I had already read the article online, but seeing it in print confirmed that the cover photo while cool, is perhaps the most disturbing thing ever. (It is 10X more haunting in print than online!)

It turns out that while all of us were falling in love with the Sapphire Reserve, so were the millennials. So much so, that Bloomberg and a ton of other publications have been fascinated by the card. Chase has hit a homerun, although one they have paid dearly for. The card is generous and it costs them quite a lot up front. This buzz comes at a cost after all.

Now I imagine somewhere atop American Express world headquarters executives were a little disturbed that a premium card from Chase was getting so much attention. Positive attention! They must have thought that something needed to be done in order to save their beloved Platinum. I can also only imagine that they told each other that they wanted to make it seem like they were making a YUUUUGE change when really they were preserving their bottom line.

Amex Platinum Enhancements

So this week American Express announced officially (Huge shout out to Ninja X who told me about this before it broke anywhere else) that all personal flavors of the Platinum card will earn 5X Membership Rewards on purchases directly from an airline, while the Business Platinum will earn 1.5X on purchases over $5K. (Starting October 6, 2016) To be fair, they do say these changes ARE NOT in response to Sapphire Reserve, but come on. No one has ever taken such a disturbing picture of people loving an Amex Platinum before! This just has to be a response! They want Bloomberg and others to come a knockin’.

Or more specifically, they want some press coverage talking about how their premium Platinum cards are now “enhanced”. And they are getting it. The news of these changes has just recently been confirmed and already CNBC has put out the following article:

American Express Platinum card sweetening perks following rival’s launch

Ah, that’s better. Soon no doubt we will see crazy photos of people lovingly caressing giant Platinum cards while eating food from the buffet at a Centurion Lounge. The above three paragraph article from CNBC only conveys what is in the press release, but it puts the message out there that Amex is responding and that is what they want.

Is This Good Enough?

The truth is though that these changes simply aren’t good enough. Membership Rewards aren’t worth as much as Ultimate Rewards, so 5X vs. 3X isn’t an apt comparison, plus the Sapphire Reserve earns a bonus on ALL TRAVEL and ALL DINING while the Platinum earns just 1X on everything but direct flight purchases. When it comes to earning, the Sapphire Reserve is still vastly superior.

I truly think that American Express is looking at their Platinum products closely now that Sapphire Reserve has launched, but it takes time to make significant changes. These new small earnings boosts are designed to get some press and to hopefully stop a little bleeding until they can come up with a proper response to Sapphire Reserve. They want those Platinum cards in people’s wallets during Q4 and this is their plan to make that happen.

Conclusion

Competition is a good thing and in this case it just made the Amex Platinum cards slightly better. Only time will tell if things will continue to improve, but with Chase and American Express in a war for the premium market, consumers do stand to gain quite a lot. We already have perhaps one of the best cards ever released in the Sapphire Reserve. Hopefully American Express will follow up this modest enhancement with some serious changes that will make them competitive again, because this just isn’t cutting it.


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11 COMMENTS

  1. Agreed. I am getting rid of the Platinum Amex. It’s been a long time coming. Every year we hear about how it may get better and they may do this or that. Finally the time comes where they do something positive and it simply is not enough. Amex is going to be left in the dust soon as they just can’t get the millennial market. Hopefully they make some serious changes soon (I like Amex as a whole, especially their customer service) because they are going to become obsolete soon and that is only going to hurt us as there will be less competition.

  2. haha. appreciate the HT bro, but more importantly I hope youre enjoying the Asia trip with your dad! Very nice to say goodbye to the CX 747 by being on one of its last flights. you honestly need some vlogs bro! i would watch them.

    also, youre totally right about “Only time will tell…” we dont know what Chase will do next year. glad you are a two CSR house. very nice! but we should all look at history for some clues. Prestige deval. Chase 7% annual bonus, 3x on Dining First Fridays, etc etc. List goes on. I cringe when people proudly say CSR is a keeper CC. how do you know?!? we will see.

    you bring up a really key point about the bloomberg magazine. this game is now mainstream. that should be a red flag to everyone. fight club is plastered on the internet now. its not just about getting CSR first year and dumping it if deval is bad. strategies have to shift. Amex 1 per life is bad but Citi 1/24 per family is bad too. then USB shut down. ebay etc etc…

    if I had to guess what amex executives where talking about its something along the lines of “hmm.. should we compete with chase?” “no, no we dont. what they did is not sustainable regardless of being the largest bank in US…” “we will do what is sustainable and can keep as a benefit without losing money…”

  3. As the never ending comparisons between Chase, Citi, and Amex go on and on, no one ever seems to mention the companion international flight perk from Amex. I wonder why?

  4. Did you cancel your Platinum Shawn? Do you find it worth it the annual fee? I cancelled mine on Aug 30 and sure enough, 21 days later they clawed back my 100K..

    • @Ric

      Why did they claw back your 100k if your already paid the AF for first year and kept it for a year? That doesn’t make sense.

      • well he gave no details of his situation so who knows. but he cancelled and got clawed back so I assume he just opened and closed asap.

      • No, I cancelled shortly after 3 months because I had MSed about $500 of the minimum spend and the points were frozen. It was too late to complete the spent organically and they would certainly claw back the points after their review anyway. So I at least got $375 back from the annual fee. If I was certain that they wouldn’t callback then I would’ve kept the card open for 1 year. But they don’t give any notice that the points are frozen until you try to transfer them out. So Amex is being very shady about all that stuff.

      • No, I cancelled it a little after 3 months after applying. I had MSed about $500 and when i found out that my points were frozen (remember that they don’t tell you and you only find out when you try to transfer them out) I was already past the 3 month spending period which probably mean that they would clawback my points in the future anyways. So at least I got $375 back from the annual fee.

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