Posted by William Charles on March 7, 2017
Credit Card Offers

Published on March 7th, 2017 | by William Charles

33

Why The New 5x Points Category On American Express Platinum Is Completely Useless

American Express have announced changes to the Personal & Business versions of their of Platinum card. One of those changes is the ability to earn 5x points on hotel bookings on amextravel.com. Everybody loves a good 5x category bonus, but I’m here to tell you that this new benefit is completely useless and nobody should be using it.

  • If you stay at chain hotels booking through amextravel.com is treated the same as any other online travel agency. This means that in the majority of cases:
    • You will not earn elite stay/night credits
    • You will not earn hotel loyalty points
    • You will not have your elite status recognized (e.g free breakfast/late check out)
  • If you don’t stay at chain hotels, or don’t care about the benefits booking directly then you have much better options.

I’m going to focus on that second point, as the first point should be fairly self explanatory. Let’s do a completely made up booking and say I want to stay at a hotel for one night and that hotel costs exactly $100.

  • With American Express you’ll earn 5x points for a total of 500 points. Let’s be completely absurd and value these points at 2¢ each. Yay, we’ve just saved/made $10.

Now let’s do the same thing, but use my favorite hotel booking website instead (Hotels.com)

  • Every ten nights you get one night free (this is the average of your ten nights. So if you completed ten nights and all were $100 each you’d get a free night for $100. If 9 nights were $100 and the last night was $1,000 you’d get a free night worth $190 etc). Let’s be conservative and assign this a value of $8.
  • You now have an option, use a gift card or don’t use a gift card.

If you’re using a gift card then you’re getting close to $25 in value and without it’s more like $13. In the above examples I clearly tried to give the new American Express benefit the best possible chance to be competitive and it still isn’t competitive. If I gave a more realistic Membership Rewards points valuation then the discrepancy becomes even greater. I mean even the one free night benefit Hotels.com offers is better than the Platinum points offer.

If the benefit was 5x points on bookings made directly at hotels then this benefit would be amazing for those that do value elite hotel status/benefits/points. Because the benefit is only for amextravel.com it makes is useless. If they want to be competitive with the Chase Sapphire Reserve, they will have to do better than this.

P.S. Yes I’ve done price comparisons and they seem to price out largely the same.



33 Responses to Why The New 5x Points Category On American Express Platinum Is Completely Useless

  1. Kevin says:

    This is how most things in life work. To get “a deal” somewhere, you sacrifice a deal somewhere else. Companies have to make money somehow. They lure you in with “5x points if you book with us”, etc but that doesn’t mean booking with them will save you the most money.

    It’s no different than people going out of their way to shop at stores that code as grocery so they can get a higher percentage cash back, without realizing that they’d probably save more in the end by buying the items at a “discount store” and foregoing the extra rewards.

    • Mser says:

      Agree with you. Except it’s sometimes better to forego the free night after 10 nights with Hotels.com and use their discount codes (I rarely pay to stay in hotels so it would take me years to earn a Hotels.com “free night”)

  2. Dave C says:

    Agree with the bigger point, but just to throw my $.02 in: I only use Hotels.com if the room is way cheaper than $100. Otherwise, I’m probably better off trying to swing a points-stay (or it’s in a place with no chains in which case rooms are probably cheap, like Macchu Pichu). With most of my Hotels.com stays being $30-50 / night, my free night will be around that value as well. Also, Hotels.com gift cards are not usable at all locations. You can use them at a lot of places, but not all. Dampens the value proposition a little bit.

    In general, I agree with your point though: you’re always better off:
    a. Using points
    b. Booking directly with chain (trying for BRG or using portal)
    c. Using Hotels.com w/ GC

  3. Michael says:

    I think you mean 500 points – “With American Express you’ll earn 5x points for a total of 50 points.”

  4. Matt says:

    The only thing I will add is that $.02 value is not absurd. That is exactly what they are worth if you hold the Business Platinum card.

  5. Bill S says:

    You forgot to factor in that the $100 room will cost you $112 on Amex travel.

  6. jcb says:

    Agree with your analysis. One caveat with Hotels.com though is that lots of hotels I’ve found don’t allow hotels.com gift cards and require payment upon arrival, so you get the stay credit but can’t use gift cards or cash back portals.

  7. Jon says:

    I agree, this is useless. But valuing the points at $.02 isn’t absurd at all, especially if you have the business platinum card (which makes them worth exactly $.02 in the worst case).

  8. P says:

    i’ve only used amextravel when Amex offers are involved and provide as good a deal.

  9. chaseaholic says:

    I think the structure of these “improvements” is just silly…especially given the increased AF for the personal. The uber credit that is capped at such a low amount per month. I understand wanting to prevent the use-and-ditch measures but $15-20/month is ridiculous. $50/month up to $200 total seems much more reasonable.

    I was curious about your thoughts on the Citi Prestige 4th night free benefit as well? I didn’t see an indepth review of it from you guys from a quick google search. i.e would you find that benefit at all worth it – in my back of the napkin math…no but I don’t have much hotel booking experience.

    Thanks for the article Will!

  10. James says:

    Everyone raves about Chase Sapphire Reserve, but I wonder what percentage of card holders will keep the card once their second annual fee hits. Amex Platinum is definitely worth it in my view if someone lives close to or travels frequently to an airport that has a Centurion lounge. The priority pass lounges, at least in the U.S, aren’t much to write home about.

    • Jags4186 says:

      Yea I’m already trying to consider what the utility of the CSR is once my AF comes due. My options are keep, downgrade to CSP, downgrade to Chase Freedom/CS. My concern is I’m currently sitting on about 150k UR points with no immediate plans to use. If I value the points at 1.7 cents each then I need to spend $3200 on travel/year on the CSR to make it worthwhile to keep vs the CSP.

      I’ve also wondered what the feasibility of downgrading my CSR to a Freedom or a no fee CS when my AF comes due, then upgrading a year later and double dip on the $300 again.

      I have a feeling the $300 won’t be around for that long though (or at the very minimum, it will be restricted)

      I blew through my $300 on January 1 this year so that money is long forgotten when the fee man comes knocking for his $450 later this year. I think Chase would have far better retention on this card if they made the fee $150, got rid of the $300 annual credit, and kept everything else the same.

      • TempyBatty says:

        The point of a credit is that not everyone will use it and thus they only have to cover the cost of a few users. Making the AF 150 would be them being way too generous.

  11. Darv says:

    It’s too bad. They’re close for me but I will probably cancel. Mine is up for renewal in June. If the Uber credits rolled over, that would do it for me. We take a couple vacations a year so $200 in Uber well worth it. Feels like they are nickel and diming on the Uber benefit.

    Even if offered 25,000 MR points, imagine I will cancel. I will probably go for the Schwab Plat or Ameriprise Plat if the bonus is right. But then again, these days I’m not sure Amex will honor the other Plat bonuses if already had a Plat in some version (yes I know some have had success, but don’t know it’s worth the risk).

    The Plat is a great card but I don’t see us getting enough out of it and definitely not at $550 in 2018. I’m still thinking about it, maybe it will come down to taking 25,000 points and keeping Amex happy. I love Amex overall.

  12. Chucks says:

    >You will not have your elite status recognized (e.g free breakfast/late check out)

    Is this really the case? I’ve never had my benefits not recognized at Hyatt, SPG or Marriott when booking through a third party, even if I didn’t accumulate points or stay credit. Is this specific to Amex Travel Hotels?

  13. Lionel Hutz says:

    MR can easily be worth 2cpp when you transfer to another partner. Calling it absurd is… Absurd.

  14. V says:

    new Amex offer for 100 off 600 hotel booking through Amex Travel. With the 5x, it’s decent

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