AmEx losing the battle for big spenders?
Feb 12, 2015, 11:03 am
#17
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You are correct that Bank of America does not have a multi-partner transfer card, but Merrill+ VISA transfers to BAEC and I have not seen any indication that they will be compensating me for the increased number of points required for a MIA-LHR-MIA trip.
Feb 12, 2015, 11:20 am
#19
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AMEX and Chase also transfer to BAEC.
Feb 12, 2015, 11:43 am
#22
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As do Diners Club, HSBC, Starwood. My point is that none of these programs have compensated us for BAEC's devaluation, and I would not expect them to do so, but some dude's post suggested that a partner devaluation lowered the value of his American Express card. I think it lowers it only if other cards behave differently.
Feb 12, 2015, 11:54 am
#26
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What I don't understand though is how big spenders are more profitable than small spenders.
If AMEX charges a merchant per transaction, how is a big spender of 1 x $10,000 more profitable than the little guy spending 10 x $100? In the first case, AMEX only gets 1 x transaction fee, in the second case 10 x transaction fee.
If AMEX charges a merchant per transaction, how is a big spender of 1 x $10,000 more profitable than the little guy spending 10 x $100? In the first case, AMEX only gets 1 x transaction fee, in the second case 10 x transaction fee.
Feb 12, 2015, 11:58 am
#28
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High income individuals are also more valuable for marketing purposes. Issuers sell access to their cardholders to merchants.
Feb 12, 2015, 12:03 pm
#30
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Credit card issuers charge a percentage of the transaction. MasterCard and VISA add a small flat-fee per transaction, but American Express typically does not. Big Spenders do not only make large purchases, they also make more purchases. It's not really a comparison between 1 X $10,000 vs 10 X $100. It's a comparison between $10,000 per month versus $1,500 per month.
High income individuals are also more valuable for marketing purposes. Issuers sell access to their cardholders to merchants.
High income individuals are also more valuable for marketing purposes. Issuers sell access to their cardholders to merchants.
I now understand why AMEX wants to do business with big spenders, but why did they bother with nickel and dime Costco customers.