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Last week, Amex refreshed their American Express Green card. The card has a very good sign up bonus and some valuable benefits. However, did Amex miss an opportunity to come up with a solid competitor in the mid-tier travel credit card space?
Green Card Sign-up Bonus
Before I analyze where Amex missed the bus, let’s look at some of the good stuff. The publicly available sign-up bonus is for 30,000 Membership Rewards points. However, if you use the incognito mode, you can get a sign-up bonus of 45,000 Membership Rewards. The increased sign-up bonus is easily available if you use the incognito mode on your browser and head over to the Amex website.
Bonus Earning Categories
The new earning categories are lucrative for earning Membership Rewards points:
- 3x points on travel including transit
- 3x points on dining worldwide
The 3x on travel and all transit is a brilliant feature. I’m glad that Amex removed that requirement of needing to book via Amex Travel. Now you can simply earn 3x by booking directly with the airline or hotel.
While the 3x on dining worldwide is great, it doesn’t always work in practice. The problem here is that many international merchants simply don’t accept Amex. I ran into this issue while trying to use my Amex Gold card at restaurants in India and Vietnam recently. Many dining establishments simply stated that they accepted only Visa or MasterCard. This issue isn’t just restricted to India or Asia in general. I ran into the same issue even while trying to use my Amex card in Colombia and the Netherlands.
The breakage strategy
I’ve written previously about how Amex’s clearly taking a different approach. I call it the breakage strategy. It’s pretty simple. Increase annual fees on cards. Add a few valuable benefits, then partner with brands to provide credits. The issue with this is that not all credits are easy to use.
Also, Amex is clamping down on people using gift cards to get all types of credits, be it the airline fee credit or the Saks Fifth Avenue credit on the Amex Platinum. In short, Amex wants you to prefer their partner brands in order to make your purchase decisions.
I always advocate that you sign up and keep a credit card that rewards you beyond the sign up bonus. Also, I strongly advocate that a new credit card benefit isn’t valuable if it makes you change your purchase behavior.
With the new Green card it’s the same thing. Ask yourself whether you’d usually shop for Away luggage or buy lounge passes from LoungeBuddy. If you already have Priority Pass, then the LoungeBuddy benefit isn’t really of much use.
Taking on the competition
With a $100 Clear Membership credit and a $100 LoungeBuddy credit and 3x on travel and dining, it isn’t surprising that this relaunch drew a lot of comparisons to the Chase Sapphire Reserve. However, given that annual fee of $150, I still think that Amex missed the bus in creating a really strong mid-tier travel rewards card.
If not for the breakage strategy, Amex could’ve come up with a $95 or $125 annual fee card, with 3x on travel and dining. That would provide consumers with a solid alternative to the Chase Sapphire Preferred or the Citi Thank You Premier card. With this card refresh, I think Amex ended up doing a bit of both. A few credits here and there and a $150 annual fee.
The Pundit’s Mantra
I would love to hear your opinion. I think that Amex missed a great chance to create a splash in the mid tier travel credit cards space. They could’ve done away with the Away Luggage, LoungeBuddy and Clear credits and simply come up with a card with an annual fee around the $100 mark. The spend bonuses and sign-up bonus would have been good enough to make it a long term keeper card.
However, given the recent refresh of the Amex Gold and now the Amex Green, it seems Amex’s breakage strategy is in action. What do you think about the new Amex Green Card? Do you think it’s worth keeping beyond the 45,000 Membership Rewards points bonus? Is it lucrative enough as a competitor to any of Citi’s or Chase’s travel credit cards? Let us know in the comments section.