US Bank Cash + Restaurants category downgraded to 2% next quarter...

[enharu]

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@wiivile wrote:

I think the question we all have to ask ourselves with regard to this card is:

Do you think U.S. Bank intentionally pulled a bait-and-switch by introducing the card with such wild rewards (uncapped 5% on airfare, hotels, bill pay, restaurants, etc), and slowly nerfing it over the course of a couple years by adding caps and replacing lucrative bonus categories with less-than-appetizing ones? Or did they just not realize how much the card could be taken advantage of?

If it's the former, I'm pretty angry, and consider this to be something, if it continues among credit card issuers, that needs to be regulated. If it was an honest mistake on their part in not realizing how lucrative the card could be for consumers, then whatever.

But all-in-all, I'm tired of having a sock drawer of once-lucrative cards that have been nerfed.

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Most likely, it's the latter.

They needed a way to attract customers, so they went overly aggressive with it.

They most likely didn't expect people to pay 1-2 years worth of bills in advance just for the 5% (actually more than just 5% once u couple in the $25 bonus and relationship bonuses).

[wiivile]

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@MrFlower wrote:

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@wiivile wrote:

I think the question we all have to ask ourselves with regard to this card is:

Do you think U.S. Bank intentionally pulled a bait-and-switch by introducing the card with such wild rewards (uncapped 5% on airfare, hotels, bill pay, restaurants, etc), and slowly nerfing it over the course of a couple years by adding caps and replacing lucrative bonus categories with less-than-appetizing ones? Or did they just not realize how much the card could be taken advantage of?

If it's the former, I'm pretty angry, and consider this to be something, if it continues among credit card issuers, that needs to be regulated. If it was an honest mistake on their part in not realizing how lucrative the card could be for consumers, then whatever.

But all-in-all, I'm tired of having a sock drawer of once-lucrative cards that have been nerfed.

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I don't think it was always inteneded. They just aren't getting the right mix of users to sustain it.

I think the big issue is it isn't up for online applications or even easy access to mail in.

They limited their user base to people walking into branches and people who browse myfico and alterntive sites that know to call.

The issue with this is most myfico/other site users aren't balance carrying users.

I also have not seen anyone report that they do broad market direct mailers. They probally target exsisitng usbank account holders but not like chase/citi and others who pull exp and the likes for large lsits.

I assume they break even or make a little at 2% categorries. I assume on 5% categories they are losing 2-3%. If allmost all users are transactors this will be an issue and I only seeing it becoming more of an issue. They need to increase the mix of transactors to revolvers or this card will continue to be nerfed.

(I could see a requirement to deposit into a usbank account to get the full being done or something like that to increase overall atributal margins.)

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This is a good point. They have not marketed the card well, and most of its users are credit-card-savvy people who are taking advantage of the rewards.

With some of the most popular cards out there, like Chase Freedom, Chase can afford us card-savvy users at the expense of the people who carry balances and don't take advantage of rewards.

By not marketing the card widely enough, U.S. Bank shot themselves, and their most loyal users, in the foot.

At any rate, this card is going in the sock drawer after December 31. I need to figure out whether I should cancel it and replace it with something else cool like the Citi Double Cash (taking a hit on my AAoA) or to just let it sit in the sock drawer. I don't like sock drawering cards.

Right now, to me, the best combination (at least for people who wanted this restaurant category) is the Citi Forward + Citi Double Cash. That's 5% on restaurant spending plus 2% on everthing else. I'm really jealous of those with the Citi Forward. I can't believe Citi hasn't nerfed it after all these years, whereas the Cash+ was nerfed after just a year or two.

[longtimelurker]

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@enharu wrote:

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@wiivile wrote:

I think the question we all have to ask ourselves with regard to this card is:

Do you think U.S. Bank intentionally pulled a bait-and-switch by introducing the card with such wild rewards (uncapped 5% on airfare, hotels, bill pay, restaurants, etc), and slowly nerfing it over the course of a couple years by adding caps and replacing lucrative bonus categories with less-than-appetizing ones? Or did they just not realize how much the card could be taken advantage of?

If it's the former, I'm pretty angry, and consider this to be something, if it continues among credit card issuers, that needs to be regulated. If it was an honest mistake on their part in not realizing how lucrative the card could be for consumers, then whatever.

But all-in-all, I'm tired of having a sock drawer of once-lucrative cards that have been nerfed.

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Most likely, it's the latter.

They needed a way to attract customers, so they went overly aggressive with it.

They most likely didn't expect people to pay 1-2 years worth of bills in advance just for the 5% (actually more than just 5% once u couple in the $25 bonus and relationship bonuses).

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I agree.  Many issuers have made mistakes,

- Chase with the original AARP card (5% off everything for 6 months, uncapped):  People did a LOT of spending during those 6 months, and some were able to close and get another one at the end of the period.

- Citi 5x TYP:  (5% uncapped groceries, gas, drug stores for a year).  Again, very heavy MS during that year.

And I think that US Bank was trying to become a major player (still regarded as regional) and did a big splash with Cash +, and quickly found it could be unprofitable.  ANd I guess it keeps failing their goals so they adjust!

Most of these cards probably come about because of different groups with competing goals;:  Marketing want the card to be adoptied, so make it as generous as possible, security/fraud groups would rather no-one ever used the card, and financial groups want it to be generating money.  At various stages different groups win!

[DieGo2SHAE]

Well there goes my backup in case the Forward ever does get nerfed. I'm amazed that the Forward is even still going strong given that it's been over a year at this point since it was killed off. I applied for it less than 2 weeks before the student version (the only version available) was nerfed to the 1% version for new accounts and I'm so glad that I didn't delay that application any further 

[takeshi74]

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@longtimelurker wrote:

Right, but that's sort of not very actionable, and that's what Wilvile meant.   Any time you sign up for a card,  it could change everything tomorrow, so how can you choose sensibly?

The reality is that cards change "fairly" rarely, and so you can use history to guess which are most likely to change, whether feature-wise (easy to get uncapped cashback at 5% is unlikely to last) or issuers/cards (Citi often nerfs, US Bank still seems very nervous with Cash Plus etc)

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That's just reality.  One can certainly use past performance as an indicator of the future but that's not totally reliable either.  One just has to make the best decision that one can with the infromation available at a given point in time and not expect every decision to be perfect and final.  It is actionable IMO to change one's expectations.  If one expects anything to remain static in this industry then one is setting one's self up for disappointment.  Adapt as needed.

[Anonymous]

wiivile - yeah... eat your heart out! Citi has nerfed/eliminated many cards in the last two years. The Citi Forward Visa (5x) is one easy to use every day no category chasing card. Got'ta love it. They even upgraded many of us to the Signature version (without the no pre-set spending limit - now allowed by Visa). Add that to my Barclay Sallie Mae and US Bank Cash+ Visa (even nerfed) and I come out very well.

[flawesome]

I'm experiancing some serious citi Forward envy over here. I even wrote an email asking for them to return it, not that that'll do anything. I know they'd lose money on that deal and they stopped offering it for a reason, but still ><

[celluloid17]

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@flawesome wrote:

I'm experiancing some serious citi Forward envy over here. I even wrote an email asking for them to return it, not that that'll do anything. I know they'd lose money on that deal and they stopped offering it for a reason, but still ><

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I'm totally bitten by the envy bug as well.  I'm impressed that Citi has kept it going this long and have continued to honor the original terms for cardholders even though it's no longer offered.  It gives me hope that if they ever decide to eliminate the Double Cash card from their line-up that thay'll still keep the card and reward structure active for those that already have it.

[longtimelurker]

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@celluloid17 wrote:

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@flawesome wrote:

I'm experiancing some serious citi Forward envy over here. I even wrote an email asking for them to return it, not that that'll do anything. I know they'd lose money on that deal and they stopped offering it for a reason, but still ><

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I'm totally bitten by the envy bug as well.  I'm impressed that Citi has kept it going this long and have continued to honor the original terms for cardholders even though it's no longer offered.  It gives me hope that if they ever decide to eliminate the Double Cash card from their line-up that thay'll still keep the card and reward structure active for those that already have it.

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This is not a general CIti thing though.   When they nerfed the Premier, there were hopes that people with the card would still earn flight points etc, but that didn't happen.  Everyone moved to the same terms as new applicants.

Wonder how many 5x Forwards are out there.  As the rumor was in Sep, would be easy to mass convert them to TY Preferred cards.

[celluloid17]

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@longtimelurker wrote:

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@celluloid17 wrote:

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@flawesome wrote:

I'm experiancing some serious citi Forward envy over here. I even wrote an email asking for them to return it, not that that'll do anything. I know they'd lose money on that deal and they stopped offering it for a reason, but still ><

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I'm totally bitten by the envy bug as well.  I'm impressed that Citi has kept it going this long and have continued to honor the original terms for cardholders even though it's no longer offered.  It gives me hope that if they ever decide to eliminate the Double Cash card from their line-up that thay'll still keep the card and reward structure active for those that already have it.

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This is not a general CIti thing though.   When they nerfed the Premier, there were hopes that people with the card would still earn flight points etc, but that didn't happen.  Everyone moved to the same terms as new applicants.

Wonder how many 5x Forwards are out there.  As the rumor was in Sep, would be easy to mass convert them to TY Preferred cards.

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Disappointing.  It seems that there was some chatter that the Dividend card was possibly being revamped and perhaps reintroduced at some point so maybe they're waiting to convert Forward card holders to that product under the guise that you can still keep your 5% on restaurants (etc.) but it will only be offered during a specific quarter(s)?