Being a Good Amex Customer
A couple of days ago as part of the “Investor Day”, American Express made it clear that they are going after people who are “gaming” their rewards programs. Specifically, they are looking for loyal long term customers and not those who only get a credit card for the bonus.
According to the company they will, “…use our analytics and technology, surgically remove gaming and reinvest in higher-quality, more loyal new customers, achieving an acquisition efficiency gain on a year-on-year basis.”
The huge issue all of the banks face is how to acquire these great customers. One of the ways they have done this is through lucrative bonuses that also draw the attention of “gamers”. To counteract these people, companies like American Express have instituted bonus restrictions and rules. For example, Amex will only give you a bonus on each product once.
And it is working. From the investor call, “…our more conservative incentive structure and the controls we have in place have largely kept gaming rates constant over the last couple of years…”. These safeguards they have put in place are seemingly working. But they want to do better and their recent Amex Platinum card changes are a good example of this.
The Amex Platinum Changes
While many people complained about the enhancements American Express made to their Platinum cards, they were very deliberate in my opinion. Giving 5X points on bookings through Amex Travel and a $200 per year Uber credit (personal Platinum only) that is doled out monthly are moves to get you invested in the Amex ecosystem.
If you are booking through Amex Travel to earn your 5X then the company benefits from not only the travel revenue, but they also get you used to using your Platinum card for purchases. Same thing with the Uber benefit. They expect you will link your Platinum card to Uber and use it as a default. They are using strategies to convert you into a good customer. As someone who has family members who love their Platinum cards I tend to think this is working.
Be A Good Customer
If Amex wants customers who are blindly loyal and you want to maximize your return, then how can you become a good customer? Seemingly these two things are at odds. Or are they?
I can’t speak for everyone, but I think Amex has the perfect card that lets us have our cake and eat it too! Of course I am talking about the SPG Amex. This card will probably go away next year, but for now I am using my SPG cards (both personal and business) more and more. Not only do I get valuable offers, but I earn valuable Starpoints from everyday non-bonused spend.
Strategize with Multiple Cards
I am guessing Amex doesn’t want to limit customers to just one card either. Amex has a great variety of cards with some good bonus categories, benefits and of course Amex Offers. For example you could be a good customer by using your SPG Amex for everyday spend and an Everyday card for gas and groceries. Maybe you have the Platinum too for the benefits of that card? The list goes on.
In a world where technology progresses and companies are more surgically focused on their bottom line, those of us who like to maximize value may have an uphill battle, but it isn’t necessarily a losing one. In my opinion you can be a good customer and still take advantage of awesome deals when they come along.
Bottom line, I’ll avoid their war on “Gamers” by not being one.
HT: Doctor of Credit for the Amex Investor Day info.`