American Express appears to be doing well with its Platinum card, having turned it into an Entertainment Book of coupons you pay for and then strive to get more value than its cost from. I have the card and do this successfully, but the mythology around the product is strange?
Bloomberg runs a paean to Amex that makes claims that just seem wrong: “It boosted points and added new benefits, then raised fees in the middle of a pandemic. The risky strategy worked.”
Boosted points? They made a number of changes to the Platinum card, but largely around statement credits more than offsetting the increase annual fee. Contra Bloomberg “dangling hundreds of thousands of points before existing customers” simply did not happen in the U.S.
Six years ago I wrote that, based on Departures magazine circulation, there appeared to be ~ 1.3 million Platinum and Centurion cardmembers, mostly in New York, California, Texas and Florida – and that there were likely fewer than 750 in North Dakota. The piece reports that Platinum cardmembership has doubled since then.
But describing the Platinum card thusly? “It’s more like a personal butler fulfilling the affluent class’s every whim.” How many people have successfully gotten something from the Amex concierge service they couldn’t have done themselves, more or less as easily?
The company has enough plastic in wallets to pave a path from its New York headquarters to its offices in California and back. And it’s convinced a new generation of cardholders that it’s a lifestyle brand and not really in the boring business of debt instruments, whatever its balance sheet says. It’s more like a personal butler fulfilling the affluent class’s every whim.
American Express is benefiting from a strong consumer over the past two years, but it doesn’t appear to be benefiting disproportionately.
I fully utilize Amex credits on spend I’d be doing otherwise, making the annual fee worthwhile. The $200 airline fee credit with Southwest; $200 Uber credit; $189 CLEAR credit (pre-price increase covering my membership and my wife’s); $240 Entertainment credit (completely paying for my NYTimes.com including cooking and SiriusXM); $50 Saks credit twice yearly. Then, having more than covered the cost of the card, I get Hilton Gold status and access to Delta lounges when flying Delta and to Centurion lounges, though I often skip the latter due to crowds. Almost the only spend I do on the card is airfare for 5x earning.
Inflation has also made nominal card spend go up quite a lot. The overall macro environment has made issuers look like geniuses. Reputations are really built, though, during tough times.
I like my card fairy well but I’m not enamored of it. Sounds like the article was quite a puff piece.
I also use this card to the best of its abilities and my budget. I definitely get the $700 back out of it and then some but it’s still a big chunk of change for something that is only 1x points on basically everything.
So I’d appreciate a boost on some stuff other than airfare and prepaid travel through their portal (which is powered by Expedia and is actually a pain in the ass due to cancelation policies and really stubborn hotels.)
I’m considering changing my CC strategy away from my current Amex Plat and CSR to Amex Gold/CSP and then adding the United Club Infinite card and possibly the Bonvoy Brilliant card because I’m basically a hardline loyalist to both brands at this point.
I racked up 1.3M miles on Amex over past 3 years. My upgrades alone have paid for themselves
It’s not quite correct that they dangled hundreds of thousands of points in front of existing cardholders AS SUCH – but they did flood the market with “NLL” offers on their cards. My MR balance has grown by about 1MM in the last two years. My wife signed up for (her third) 150k Amex Biz Plat + 60k Amex Biz checking, and THE WEEK AFTER opening both accounts got another targeted mailer for the same two products. So I do think it’s fair that, at least on the business side, Amex has been aggressively targeting existing customers with big bonuses.
I got my first Green Card in 1983 (Member since) I like the brand. Others don’t need to 😉
My current 1 yr old Platinum renews now (I’ve double dipped) and while I will check for retention bonuses, I’m tired of the coupon book after just using the $200 airline credit for 4 $50 UA Flightbucks. Saks is not where I shop so I used the $50 on nice wash cloths and towels. But I’m plenty well stocked after a few credits
I agree with Gary & only use card for airfare. The lounges have been underwhelming since the first DFW where I got a massage!
Plus by downgrading, I get back in the pool for a NLL upgrade offer. Two years ago I had just a Green Card. Then I got a MR bonus offer to Gold. Then I got a MR bonus offer for this platinum card I’ve had lots of AmEx cards over the years.
Love this game. I spent today responding to Japan Airlines downgrading my First ORD-HND for next June RTW trip. Discovered next day availability from JFK and opportunity to enjoy all new T8 Services and Lounges plus overnight at TWA Hotel!
Then jiggled the following flights to still line up with GRU-MIA for nostalgia AA First Class for only (rolled eye emoji) 160,000 AA. Swivel that seat!
Current routing DCA JFK HND NRT HEL FRA DOH GRU MIA DCA. 28,000+ miles. But has 5 1/2 hours to transfer HND NRT & 1 hour connection (although different tickets) at FRA – same Terminal 2 Hoping LH First on B747-8i will open up near departure for HND FRA GRU & FCT!
RTW Trips in July (AA, QR, & BA FIRST) & October (SQ Suites SYD LHR, BA First home) schedules holding up! Shepard your reservations as Gary advises
I get my money back, but I really liked the structure of the benefits/etc. better before the pandemic. I’ll still hold onto it for a few more years, but I could see myself dropping at it some point in the future. To be honest, I earn nearly 100k MR points on my Gold card every year, and that’s less than half the price of the Platinum.
We’ll see, but right now I feel like they are moving in the wrong direction.
Under Chenault the “membership has its privileges” statement was totally trashed. Its just another card.
You are right, but too kind.
I tried to use their concierge service and found the concierge was just a college student without a nouse of interlligence.
One thing I used this year was the cell phone insurance. Just have my ATT bill auto paid by card and when my daughter’s IPhone 12 was damaged beyond repair I paid $449 for a replacement at Apple Store. Filed w ATT cell phone insurance carrier and got $399 (($50 deductible) mailed out. I get more than the AF otherwise but this was a nice add on benefit
And they obviously do not care about having airline employees as customers. They market their overpriced plat card to us, but then will not let us into the lounge without a seat assignment which we almost never have until an hour before departure time.
I realize airline employees probably overused the card in the past. I reached out to an amex exec a couple years ago (before the overcrowding problems) asking why they could not allow one or two visits a month for standby passengers (not just airline employees but also stranded revenue like during the WN meltdown). and some rude person called me back and tried to lecture me about how their lounges are NOT for standby passengers.
Their prequals go where their card belongs in the garbage. I would at least think their execs would care more about who calls prospective customers on their behalf. I think Berkshire-Hathaway owns a lot of amex. Warren Buffett likes to offer advice on how to spend money wisely. I doubt he would advise paying full price for a fraction of the benefits.
I also agree on the embarrassing coupon book scheme. If they offered a good product at a fair price they would not have to stoop to that level.
The only Amex I might ever consider owning is the Hilton card with premium access, but after the rude call, I might not even do that.
As of this month, I can no longer enter a SkyCkub or have my wife and child in the Amex lounge. Goodbye useless card.
Unless you fly Delta frequently or have a Centurion at your home airport I don’t see any use for the card. It’s a glorified coupon book that has zero prestige or exclusivity to it.
well, technically amex has been dangling and giving out massive SUB on the Plat which can be construed as boosted points.
in the past 3 years i ended up acquiring 3 Plats mainly because of the SUB
Lounge have been mostly good. SFO and DEN are great if occasionally overcrowded. LAS felt gross because not enough cleaning. LGA was nice but surprised they didn’t make it bigger.
My main disappointment has been how horrifically bad the Amex Travel phone reps are. If Amex Travel was a pleasant experience, I’d be a loyal customer forever, but instead I feel transactional about it.
Completely agree with your analysis Gary. The Bloombag article was insufferable.
Hard to think that the Amex Platinum Card is prestigious if there are more than 2 million current domestic cardholders and that anyone with a pulse and a 600 FICO score can qualify. Aside from that, it is what it is. A card with a high annual fee with coupon book style discounts and redemption options.
I find great value with the streaming credits, Uber credits, Delta Sky Club access, Clear credit, FHR credit, $200 airline credit (which can be used on Delta if used in conjunction with gift cards for select cases) on airfare, Saks credit, and several more discounts and perks. I don’t have to put a lot of spend on the card for these perks. I will happily keep the Amex Platinum Card until it no longer offers value for me.
If a person assesses the Platinum Card based on whether one can cover the annual fee via the statement credits, then it is not the right card for that person. If a person has a meaningful amount of travel and uses it for that travel, then it is a great card. My wife and I see the following value from just FHR stays:
$1600 FHR property credit (16 stays x $100)
$3200 FHR welcome amenity (16 stays x $200)
$7500 FHR breakfast credit (100 days x $75)
Pick a number for guaranteed late check-out and other elite tier-like benefits.
Upgrades are hit or miss but we typically have a few upgrades in a year of which the value of each is north of $5k.
As for Amex-accessed airport lounges, I have about two dozen visits per year and my wife about a dozen or so. As much as I read about over-crowding and denial of access, we’ve never experienced it.
Would you really use SiriusXM otherwise, though? I don’t know anyone who does this (I wouldn’t otherwise shop at Saks, but I at least know people who would).
@Lee: How does this compare?
The most under leveraged benefit is the international business class program. Most members are not even aware of it, but you can save 10-20% on most international business class round trip tickets, and that pays for your annual fee right there.
@Tony: Yes. At $6, month. Millions do. You should get out more.
@Esquiar – SFO Amex Cent Lounge has been expanded/reopened – now able to accommodate a much larger number!.
Just learning that Amex Travel phone reps could also be Expedia Reps, “contracted” which explains the bad experience… / Just saying!
The reason the Platinum card is so popular is because Amex is handing then out to anyone willing to pay the $695. Not to mention the amount of MR points you can get as a sub. If ever the Platinum goes back to the 60-75k MR points you’ll probably see Platinum numbers start to slow down.
As long as one can continue to get 100-150k MR points on the regular, Schwab, Morgan Stanley, and Biz Platinum, they’ll continue to have record growth. Add to that the NLL offers that allows one to have several Biz Plats and since Amex has a high tolerance for MS the $15k spend requirements on the Biz Plats are a walk in the park for those seasoned in this hobby.
Add on to all of that the 40-60k retention offers that Amex continues to give to those who threaten to cancel and it’s no wonder why they’re seeing record growth with the Platinum.
If Amex Platinum offered United Club access, I’d almost certainly get it. Unfortunately for Amex, I never fly Delta.
If you do the math, Amex wins and you lose. Every time. You’ll never come out ahead. It can be helpful if you travel a lot, but you’re still losing out.
L3, great question.
Before getting to the key issue, I think it’s fair to touch on the matter of statement credits. Of those we do use (spending that would otherwise still occur):
$240 digital entertainment
$200 airline incidentals
$200 annual FHR credit
$189 Clear membership
So, for us and without anything more, the annual fee argument is truly negated. Then, throw in the value of lounge access. Then, throw in the value of the higher earning rate on airfare.
Now, to your point, the big issue becomes what a person’s point earn rate is when a booking includes similar benefits. The Amex Platinum will earn 5X. Chase’s LHR will earn 3X. Depending on the specific card used, I believe Virtuoso will likely earn 3X. (I’ll leave out co-branded cards.) Consider the following:
$10k spend x 2X advantage = 20k points x 2 cents per point = $400 higher value
$20k spend yields $800 higher value
$30k spend yields $1200 higher value, and so on.
Pick your spending level and do the math.
If your target transfer partner sees transfer bonuses, apply a multiple appropriately.
Adding the previously mentioned benefits with the higher earn rate, my wife and I see between $25k and $30k per year in added value from the card . . . which is effectively a net-zero annual fee card.
IF a person actually uses the card, its value far outstrips the value proposition of other programs and one does not obsess over the annual fee. If a person has less than (say) $10k in hotel bookings per year, then the difference relative to other programs is too small to favor FHR . . . and one will obsess over the annual fee.
Hope this helps.
The downside of American Express points is American Express Travel.
Basically Orbitz white labeled. Crappy customer service. Linitee support from Amex when they F up since they are a “partner” and they prefer not to get involved. Try issuing a dispute against them. Amex is more on their side than the consumer. Amex Travel struggles to get Rewards # attached, sells what appears to be business or first class tickets but the ticket code isn’t either and the points earning is much less for the same price (less 20-30 bucks)
AMEX Plat after knocking down the points rebates on redemptions gutted the card
“‘dangling hundreds of thousands of points before existing customers’ simply did not happen in the U.S.”
I seem to recall a Platinum sign up offer during pandemic times that went something like this:
125k after spending $6k in 6 months
15x shop small and restaurants up to $25k for 1 year
4x extra points per $1/spent up to $25k for 1 year referral
That is dangling points 100,000s of points.
There were also variations with 10x groceries for 1 year, probably others as well.
Next time you’re in a Cent Lounge look at the average age of the people there. In my experience they appear to be 25-35. That tells you who Amex’s target market is. The bank is no longer your grandfather’s bank. It used to be like a well-heeled men’s club (no sexism I tended); now it is like a Tumi or Lulumon store. If it wasn’t for all the business travel I do on Delta I wouldn’t keep the card.
Gary is once again spot on. While Amex Plat may provide value that exceeds AF, many of us do not have time or inclination to play coupon book game particularly with monthly credits like Uber and multiple cards. Mrs. B has a hard enough time remembering which card to use for everyday spend, SUBs, etc.
The prime draw of this card was the Amex lounges, as it was the only way to get through the door. With waiting lines and crappy good there is no reason for me to carry this card past the first year after collecting the SUB. Amex provides no reason to actually use the Plat card except for the travel insurance, which is equivalent to CSR/JPMR (and the latter do not require RT bookings).
Somebody translate for me, please. What are NLL offers?
The combo of cards–Gold 4x, Plat Biz 1.5 and then a 35% rebate on travel seems to be the sweet spot in all of this discussion. YMMV.
I had my Platinum Card for roughly 25 years, and at one time considered its features of great value. I routinely flew First/Business with 2 for 1, used their genuinely helpful concierge service, had my own dedicated travel agent, used the reservation line for difficult to book restaurants, and was able to get FHR upgrades on normal rates. Every single one of those features was taken away and replaced with coupons for stuff I don’t. use, don’t want, and don’t want to have to think about spending to rationalize the fee.
At the start of Covid while the world was shut down they refused to cut me any break on the Annual Fee and I was finally done with Amex Platinum and have not been remotely tempted to go back.
I see these reports of cardholder growth and I can’t help but think that Amex’s resurgence is built on some sort of accounting trick . . . I can’t believe so many irrational people exist.
My company allows me to book allow of my work travel and reimburses me. About 100-125k per year.
I put all of my flights 50-60k (I fly AA) on the AMEX as well as many of the large household expenses that will get paid monthly otherwise. I put all of my hotels on my Hyatt card for some point benefit there that the AMEX lacks (Globalist w/ Hyatt and Ambassador w/ Marriott). All gets paid at the end of the month. Done properly this is THE BEST travel card out there $ for $ if you travel heavily as I do. The lounge access assure that I have lounge options at most airports ( I have Admirals Club membership as well) although quality isn’t always great especially with Priority Pass lounges but they are typically better than just hanging in the terminal
Redemption wise do not redeem for travel through AMEX. Transfer points to other currencies (to other airline points) and you will be able to get 50% more value out of them.
I own the Schwab platinum card primarily to be able to convert my business gold rewards points into cash. Getting 4x points on shipping with my business is a huge money maker because of the cash conversion. Otherwise, AMEX points kind of suck.
The small perks are nice but i can’t imagine getting this card just to only use only this card.
I understand cutting guests out of free Centurion Club access. Howe6, it would have been nice to include spouses entering with the card member at no additional charge.
Dale Sturm, to answer your question:
Amex extends welcome offers to card applicants. X points for $Y of spending with Z months of account opening. If you look at the offers’ terms and conditions, they typically begin with “Welcome offer not available to applicants who have or have had this Card,” which implies “HAVE OR EVER HAD the specific card in their entire lifetime.” Thus, we have Amex’s “Lifetime Limit” language.
However, recently, Amex has extended welcome offers on certain cards whose terms and conditions do not have the “HAVE OR EVER HAD” language. The absence of such language allows a person to obtain a welcome offer on a specific card even if the person previously received a welcome offer on the specific card. Such offers are referred to as “No Lifetime Language” offers or simply “NLL” offers.
Hope this helps.
Tim Sellman gets it. If you travel, you understand the value of the card. If you don’t travel, you don’t understand the value of the card. It’s that simple.
The statement credits are there to entice individuals who don’t value the card’s travel benefits but covet it because of its renown. Those individuals are admonished to remember what Spock said: “Having is not so pleasing a thing, after all, as wanting.”
I am glad to hear that some folks get use out of the coupon book.
For me it would consider changing brands and merchants, for a card somewhat mediocre on earn. When you add on that the cutbacks to family travel, and the lack of downgrade options with no 0 or two figure AF, this card remains a pass.
Plus, AMEX once cut me off while months into a long trip abroad, and even though I paid them immediately, didn’t want to send me a replacement. So much for great customer service.
This is a great discussion about the Platinum Card. I learned a lot.
I will try to make this quick: I had lunch with Warren Buffett several years ago. He pulled out his wallet and showed me the credit card he carries. Naturally it was an Amex card (since Berkshire Hathaway owns 20% of the company) but I was surprised that it was only the Green card. He said he pays the annual fee like everyone else. The guy could certainly qualify for the Black card (or Amex could just give it to him) but he appears to be happy with his Green card.
Oh, and he also had one of those “lifetime eat free at McDonald’s” cards and also a Hooters card.
@Rick Nayhew: ‘“lifetime eat free at McDonald’s” cards’
Where can I get one of those?
Every once in awhile McDoald’s has a contest for the card, Otherwise I think only famous people get them.