GUWonder

mr8

People are still flying united, but they're using the CSR instead of the united branded cards. UA is whining because Chase is targeting and offering frequent flyers a more lucrative card to pay for flights including United flights. What UA would like is if everyone used their UA branded card to purchase tickets directly from united so they could reduce their processing fees and gain other financial incentives.

Can't really blame Chase since UA has been specifically targeting non-frequent flyers with the explorer card, which is excellent if you don't have status and want to get a basic economy ticket, but not so great if you're a MP Silver+ or fly F.

jsloan

katan

I was hitting the semantic, but I overall agree with your point. It is a generous program. In my household, a max biz class ticket is about 7.3% back from UA. That is to take the the $6818 vs. the 75k and turn it into Home Depot gift cards. I use Home Depot because it is always a need and never an argument at my home - as much as I would prefer to blow them on something less useful. 75k is just shy of $500 in Home Depot. I also use it because it is money out of the UA door. 7.3%.

To get the same from CSR, I would need 50k UR points. If it was all the highest earning category, that would be $16.6k in spending. 3% (obviously).

So as long as my butt is in a seat paying for a high end biz class ticket, UA miles are awesome. But all of the other ways that you earn miles such as CC spend or all the other crazy ideas they come up with, none of them reach that 3% mark - ever. That's where UA needs to recalibrate their thinking. The price they sell miles to Chase is nothing like how it can be monetized through flying. Hence devaluation in a hurry.

I burned through a ton of miles a few years back with Saver Awards to Asia. 160k saver business RT. I think I was getting $0.02 a mile in value. Back to my 16.6k to get $500 from CSR, max earning at 2miles per $ on my UA card, I get a value of around of $664. Better than my $500 at Home Depot from CSR. So gosh they just need to deflate the currency so that we actually care, or make flights available, or CSR is going to eat their lunch for frequent fliers. Not to mention as a FF, using my miles to fly more is sometimes a fun mental exercise of what I want to do with my free time.

lexdevil

I am that rare bird, someone who holds and uses both the CSR and the United Club card. Like so many others, I have migrated all air and dining spend to the CSR because it has become near impossible to redeem United miles for saver rate business seats on the routes/times I want to redeem them. I use my Chase UR points at 1.5¢ each to purchase the tickets I want through Chase. This is poor value compared to the saver redemption I used to be able to make with United, but it is much better value than using United miles at the standard rates.

I still keep my hotel spend on my Marriott Visa and AmEx cards, as the earn on hotel stays is better there than on the CSR and I have no trouble redeeming my Marriott Bonvoy points.

Why do I keep the United Club card? Not for bags or boarding as I get them anyway as a United Gold. Not for Club access either; I like it just fine, but don't use it enough to justify the price tag. I keep the United Club card and use it for unbonused spend, specifically items where I want price protection. The United Club card is one of the very few remaining that include this protection. I'm pretty careful about tracking prices and I usually get around $1,000 back each year in price protection claims. I like having the freedom to buy things when I need them and where I want to shop without having to worry about paying too much. I was able to buy a new mattress right before having back surgery and then get $500 back on it a few months later. I bought headphones in an airport when I needed them, sat at the gate and price matched them on Amazon and submitted a price match claim before boarding my flight. This benefit more than pays for the card and the Club access is just gravy. If/when United ditches this benefit I will almost certainly drop the United Club card and move my unbonused spend to whatever will earn the best value.

GUWonder

mr8

You may have just inspired me to sign up for the club card!

FlyingHighlander

Maybe I'm not understanding, but it seems like you're saying you pay $450/yr for the card so that you dont need to shop around. The money you are getting back via purchase protection seems to be money you shouldn't have needed to spend in the first place. Essentially you're paying $450 for convenience, but you are paying $450 and not truly recouping it in hard dollars.

lexdevil

Not quite correct. It's not a question of avoiding shopping around. I **do** shop around. I could not make these claims if I did not.

Price protection allows me to get what I want **when* and **where** I want/need it. In many cases I would be stuck paying the higher price because I needed the item right away. For example, when I was about to be laid up in bed recovering from back surgery I needed a new mattress. I could not wait for a sale. I had to take the best option that could be delivered before my surgery date. Price protection allowed me to do that knowing that there was a sale coming up w/in the 90 day price protection period that I would be able to take advantage of retroactively. The headphones are another good example. I was flying that day and wanted the headphones for my flight. Price protection meant I could have them right away and take advantage of the better price online. Another recent example is the TENS unit I purchased before my back surgery. CVS sold it cheaper online than in the store, but I was in pain and needed it right away. Yet another good example of time sensitive purchases is birthday presents.

In many other cases price protection has allowed me to get a rebate on a product that went on an unanticipated sale after I purchased it. I **did** shop around and got the best price at the time that I made my purchase, but the product went on sale later. You may be able to always purchase products when they are priced at their lowest, but I am not always so lucky. As a result, I've found price protection to be quite valuable.

I also get lounge access. I value it. I just wouldn't pay for the card for lounge access alone.

In addition, the United Club card earns 1.5 United miles for every $1 in unbonused spend. That's not a terrible rate. It was a much better rate before United's recent changes, but it's probably a little better than the CSR's 1 UR point per $1 spent and it's also competitive with a 2% cash back card. And neither of those options have purchase price protection.

findark

I mean, the primary reason is because non-United Chase cards are better at earning United miles than are United-branded Chase cards. Even ignoring the much broader option portfolio available to UR balances, they can still be used as United miles.


However, my broader point about the generosity of the FFPs was more agreeing with jsloan about the future of the industry in general. Without a business model where many, many empty seats are a cost of doing business, having the kind of FFPs we've seen over the past decades is much harder for airlines and I think we're going to see the overall value of award travel and upgrade diminish over time. I remember when SY rebooted their mileage program last year (RIP), the base earn on airfare is now a measly 2.0%, which is actually outperformed by their CC. Sadly, I think that is a harbinger of more to come.

naumank

Scott Kirby has only himself to blame because he is the driving force behind the change to dynamic pricing of award travels. I have consistently spent $35K+ annually on my UA Platinum Visa over the past 10 years. Now I have decided to switch 100% to CSR+CFU. Why would I use a card that is offering 1 UA mile (worth close to 1c now) per dollar while I can easily get at least 2.25 c per dollar spent with UR?

halls120

I'm sure they would. I would still have my UA Club Card had I not realized that giving UA all my credit card business resulted in amassing points that UA devalued whenever it strikes their fancy, and that MP overall wasn't the value proposition it once was.

What UA is really whining about is that customers have finally figured out the game UA is playing, and have chose to play elsewhere.

FlyingHighlander

Thanks for expanding on your answer. Good points. I can see the value you get - not sure my spending habits would realize the same, but I can see the potential.

I currently have the UA Explorer Visa and CSR. This is is my first year of heavy business travel so I wanted the benefits from the UA card. I also wasnt sure if I'd need the spend waiver (turns out I'll easily hit Plat without it). I was going to get the Club card a few months ago (pre M+ devaluing) but I'm at 5/24 until August. The 1.5 earn rate on unbonused spend was (at least back then) attractive and would have covered half the AF at least. I'd get enough value from the Club membership to justify the rest.

While I no longer need the benefits of the UA card, I may not dump it quite yet. I will wait to make sure next years travel schedule is somewhat known, but I confident I'll always make at least Gold without a waiver. As soon as I feel i don't need a waiver I'll move all spend to my CSR, with a perhaps some going to Amex Plat. I earn MR with my Corporate Amex Green (pay $90/yr to do so) so I'll always have points in both MR and UR.

Boraxo

I think you are comparing apples and oranges (or in this case, RDM from flights v. miles earned through spend) though it is hard to tell.

To use your example, I sometimes earn close to 75k RDM from actual BIS flying (though of course the RDM are now based on the price of the ticket rather than distance). I can then use the 75k RDM for a one-way TATL business class seat that might cost $1.5-2k if purchased with cash (though best fares are usually RT). So on a $6k RT business class TATL/TPAC ticket that is an ROI of 25-33%, and even better as my employer buys the ticket but I get the reward. The RDM earn and burn has nothing to do with the card you use to pay the fare.

The analysis for credit card spend is completely different and has nothing to do with flying. Your choices are a 2% cash back card or miles or points in a specific program. To use your example, $50k spending (which, for might be close to annual spend on non-bonus categories for those of us who don't "manufacture" spend) would earn a cash reward of $1000. Or it could earn 50k UA miles, 50k Chase points (75k if you do Chase Freedom-> CSP/CSR point conversion), 50k Amex, or 50k points in many air and hotel programs. It sounds like you would use those points to buy a $500 home depot gift card.

Which of these alternatives earns the highest or best ROI for your spend? Personally I would take the 50k Chase or Amex points because I can transfer them to a partner where I value the air travel at >.02 per point. But if that was not the case, I would certainly take $1000 (from 2% card) > $750 Chase travel portal credit > $700 (Chase WN card) > $500 gift card. And I would definitely not take 50k in UA, AA or Skypesos when I could get 50k Chase UR or Amex points that could be transferred to many programs.

The real question is can you use your miles or points for travel that brings a value > .02 per mile/point? That is almost impossible now with miles in the UA/DL/AA/WN/B6 programs, excepting redemptions on *A, OW and ST partners. If those awards disappear then I expect people will give a closer look to the cash back cards, and Scott Kirby will continue to see his card #s tank.

PsiFighter37

The long and short of it is that I would use the Presidential Plus more if I got more miles for travel on it than I did using the CSR. That said, I still have a reason to use it because I do value the FPQMs, and given my actual BIS is going to greatly decrease after this year now that my family is growing beyond myself and my wife, it will make it easier for me to maintain Platinum status without flying nowhere close to the actual mileage needed. Given my level of spend (and especially of ability to pay rent in Manhattan via CC), this is a very meaningful benefit to me.

If I had the current Club Card, I would heavily debate whether to bother keeping it.