The big news recently was the new  Bluebird alternative, the Amex Target RedCard, which just rolled out. See American Express Launches Prepaid Target REDcard Similar To Serve/Bluebird.
I’d like to discuss a completely different use of this new RedCard, which is how I’ll be using it. I’d also like to add a few thoughts about the potential of this new product.
The 7% Off Card for Target Shopping
As we know, Target offers a RedCard which gives 5% off most purchases at Target. I’m not referring to the new Amex Target RedCard, I’m referring to an old card which all of you are probably familiar with. I shop in Target often and I prefer it to Walmart for a number of reasons, and I love getting 5% off all my shopping. I buy groceries, pharmaceuticals, personal hygiene items – just about all daily-use items.
Until now, it’s never been possible to get credit card points on top of the 5% discount; since you’re using the Target RedCard – whether the credit version or the debit version – you only get the 5% discount, nothing more.
All that just changed with the launch of the Amex RedCard.
First, a few facts:
- the temporary Amex RedCard can be purchased with a credit card (link).
- the temporary card can be purchased even by those who have a Bluebird/Serve card; it’s just the permanent version which will be denied to those who have Bluebird/Serve.
- the temporary card does get 5% off at Target – it’s explicit in the FAQ’s.
So what I’ll be doing is going every couple months and purchasing a temporary Amex RedCard, loading it with a few hundred dollars (going through the hassle of entering my SSN and driver’s license each time), and paying for it with a credit card.
Essentially, it’s a way of purchasing a Target gift card at a 5% discount, and paying with a credit card. Since I value credit card points at about 2%, I’m calling it the 7% off card, but you can plug in whatever number you want according to your evaluations. [EDIT: And it could be as much as a 10% card if you have a Visa or Mastercard which gives 5% back at supermarkets, see here and here]
Other Thoughts
In conclusion, I want to be clear that it’s not that I don’t think the Amex RedCard (“RedBird” as someone wanted to call it) isn’t big news for using it as a permanent card. I think it’s huge news. I can see myself switching to the permanent RedCard sometime in the future, though not now.
See, I predict that within a year or two, Serve will no longer be able to be loaded online with a credit card. Once that happens, the Amex RedCard becomes a very promising alternative to Serve, because:
- I shop there anyway
- much less lines than Walmart (at least in my area)
- more pleasant, nicer environment
- in my experience, GiftCardMall Visa gift cards default as debit cards
- hopefully Vanilla will also default as a debit card (though there’s already one FlyerTalk data-point indicating that it defaults as a credit card)
- Target POS is known to “eat-up” the balance of gift cards. If I’m not mistaken, this works even when the gift card is processed as a debit card. So will that mean that we’ll be able to tell the cashier “$1000”, and then get the 5 $200 gift cards “eaten up”, without having to train the cashier how to do it, like we need to do in Walmart?
- Target POS allows at least 7 cards to be used in one transaction (and I believe the true number is higher). Will we be able to drain 7-in-1, trumping the 3-card limit for loading Bluebird/Serve in Walmart?
The reason why I’m not convinced that I’ll change to Amex RedCard in the future is because I haven’t seen anywhere that the RedCard is eligible for Amex Offers, which I find very valuable. However, I did notice that the entire Amex RedCard website is a sub-domain of serve.com (contrast that to bluebird.com). So I do see the possibility that it will be able to get Amex Offers like Serve can, at least some time in the future.
One other note: it’s been mentioned the possibility that Serve will become loadable in Target sometime in the future. If that happens, then of course there would be no reason to switch from Serve to RedCard, since we’d be able to choose Target or Walmart with Serve, making it the best of all worlds.
In any event, even if I do switch sometime in the future to the permanent RedCard, I’ll still be buying temporary RedCards in order to get 5% plus credit card points, as mentioned before.
