diesteldorf

I got the Chase Sapphire Reserve (CSR) in March, 2017 and was easily able to use the travel credit, Global Entry reimbursement and earn the 100,000 signup bonus. It has enough other benefits, especially with the travel and dining bonus, that I elected to keep the card when the second annual fee was due. After the travel credit, the annual fee is reduced to $150.

I had never considered the American Express Platinum card until recently when I started looking at all the benefits. I used Uber on regular basis anyway and it's actually possible to get the $200 airline credit twice in the 1st year. I decided to apply after I began planning a trip[ and was looking at lounge options in MSP and Indianapolis and contemplating buying a couple of Delta Sky Club passes. Then I decided that I should just get the Platinum Card, save the money on the day passes, and enjoy the other Platinum benefits. I've already been able to redeem the airline credit for 2018 and know I won't have any trouble using Uber.

After deducting those credits, the annual fee is essentially reduced from $550 to $150, equal to the CSR. Yet, from a lounge standpoint, the Platinum Card offers so much more with access to Escape, Delta Sky Club, and Centurion Lounge access.

By making the Platinum Card accessible to more people, due to the credits and benefits that offset the annual fee, is Amex sacrificing revenue, diluting their brand, and giving them less of an incentive to offer a better lounge experience than their competitors?

Lounges cost money and I would assume that Centurion Lounges, in particular are not cheap, yet they have said they are planning to open more of them. In addition, I am sure Delta will continue to ask for more compensation to continue providing Sky Club Access.

Personally, I find the CSR to be more useful for earning points on hotels, dining, and flight, since I often make 3rd Party reservations using Priceline, Hotels.com, or Expedia. I appreciate the Amex brand, their customer service, and their return protection benefits, but if every customer was like me, I can't imagine they would have the incentive to continue offering a premium lounge experience.

I know there are those that probably spend hundreds of thousands of dollars with Amex every year, and I am sure Amex will continue to cater to those individuals, especially their Centurion Card clients, yet I have to wonder what will happen if more and more people get the Platinum Card simply for the benefits without putting spend on the card.

Will this lead to overcrowding and potentially upset their more lucrative clients, causing them to move to competitors?

Will Amex offer even better lounge access to those that meet yearly spend thresholds or even tell some Platinum Card members that they are not welcome at certain lounges?

I realize there are probably some that keep the Platinum Card without using all the credits and benefits, but does it also mean that Amex may be losing revenue or using the Platinum Card as a loss-leader to secure less wealthier customers, hoping they will spend more in the future?

As a side note, does anyone think Chase may open their own Sapphire Lounges in the future to further compete with Amex?

Gig103

I think that FTers are the minority when it comes to getting a card and putting it in a drawer and bouncing our spending around to maximize category bonuses.

worldwidedreamer

Credit card companies view most benefits as insurance policies with benefits claimed. From their perspective the best type of benefit makes end users happy, and costs nothing. American Express knows that Priority Pass attracts a category of customer, but they make it harder by requiring the customer to sign up for the benefit. The same is true for many other travel benefits---and the bundled insurance policies. This is not a mistake, but a reflection of how the business is run.

Now we can't get the data but my premium Amex card required me to call to request a Priority Pass that includes two guests. My premium Chase card sent an unlimited guest Priority Pass card a few days after my credit card arrived. Would love to know how much more the Chase benefit costs. (Would even more love to know how each bank sees the cards driving revenue.)

mia

That may be the process for some Chase cards, but for the mass market Sapphire Reserve it must be requested. American Express Platinum allows the primary cardholder's Priority Pass card to be requested online, but additional cardholders do require a phone call (or perhaps an online Chat.)

krazykanuck

The only reason Amex is able to offer so much of a rebate in the form of credits is because the credits likely have a huge amount of breakage. I'd guess that the number of Plat cardholders that utilize 100% of their Uber, airline, and Saks credits is quite low. As Gig103 mentions, we're exception to the rule on Flyertalk. Also I highly doubt Chase would want to spend that money, and more importantly, get that invested first hand in a physical space. Chase outsources nearly all the benefits (lounges, insurance, etc) to 3rd parties and the CSR is already a very compelling offering at a net-AF of $150/yr.

Completely agree. It's worth keeping in mind that the Escape Lounges used to accept PP, but Amex made an exclusivity deal with them so they dropped PP and now you need an Amex Plat/Centurion for complimentary admission. The reports on here and other forums is that the quality has gone up a lot after they stopped accepting PP.

Also to mention, Amex decided to stop allowing non Plat/Cent cardholders to buy day passes to the Centurion Lounges at $50/pp in part to protect the "exclusivity" of the lounges. I use that term in quotes since nearly anybody can get a Platinum card these days if they're willing to pay the fee.

With the Ritz card your PP card is sent automatically.

worldwidedreamer

mia

I doubt that American Express pays anything for these features. I wouldn't be surprised if Uber and Saks pay American Express for the access to their cardholders, in which case American Express would see full utilization as a positive because it helps them sell the program for another year.

diesteldorf

That would be interesting if true. Basically Amex would be netting $350 on each card holder, after deducting the $200 airline credit AND also expanding their card holder base.

Personally, I thought the Saks credit was nice, but I can't actually value it at face value. On the other hand, the Uber credit has been very easy to use.

It'll be interesting to see how long the current benefits remain. I suppose I should just enjoy them and not complain.