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@wasCB14 wrote:
@myjourney wrote:Lets see can I make it simple
Why would banks offer a no AF with points say for a person like me who redeems for no less than 2.2
When cash back can be paid out in most cases for .01 cents or less over the course of months due to redemption thresholds
Out of money I made millions on which means basically it was free to me (banks)
Did I miss something?
I'm always willing to listen and learn now
As it stands tho personally I would love to abuse points for 2.2 due to cash back being switched over to a point system with no AF
Certainly banks will make even less profit because of a move in this direction Lol
Because the bank buys the points for much less than 1 cpp from the hotel or airline. Why would the bank care how efficiently you redeem the points, so long as the bank can buy the points at a deep discount from the hotel/airline?
I understand your point truly
However you have to remember it's an alliance and both parties want to make money bank and or airline/hotel
When the hotel sells the lots they also have a plan for how they can profit from the sell I think this point is forgotten
@myjourney wrote:
@wasCB14 wrote:
@myjourney wrote:Lets see can I make it simple
Why would banks offer a no AF with points say for a person like me who redeems for no less than 2.2
When cash back can be paid out in most cases for .01 cents or less over the course of months due to redemption thresholds
Out of money I made millions on which means basically it was free to me (banks)
Did I miss something?
I'm always willing to listen and learn now
As it stands tho personally I would love to abuse points for 2.2 due to cash back being switched over to a point system with no AF
Certainly banks will make even less profit because of a move in this direction Lol
Because the bank buys the points for much less than 1 cpp from the hotel or airline. Why would the bank care how efficiently you redeem the points, so long as the bank can buy the points at a deep discount from the hotel/airline?
I understand your point truly
However you have to remember it's an alliance and both parties want to make money bank and or airline/hotel
When the hotel sells the lots they also have a plan for how they can profit from the sell I think this point is forgotten
But that is was capacity management is all about. I sell 100M of my airline;s miles to Bob's Credit Card for 0.75c each, and my frequent flyer program is already built so that I make enough profit. I keep capacity control so that the important flights are filled with paying passengers. Yes, lots of complaints from Bob's users about just how hard it is to get decent award travel on LTL Airline, but hey, they're all a bunch of whiners. But then there are all those great posts of people redeeming at 3, 4 or 5c per point, which is fine for me as I make a profit on that too. That 1st class flight doesn't *really* cost $20K, I get a handful of people who pay that (or their businesses do), the rest would be empty seats if I didn't "allow" those clever redemptions.....
@Anonymous wrote:
I think the amex everyday was great for consumers but a terrible idea for AmEx. By having a card that can freely transfer to partners without an annual fee, there is a disincentive for consumers to a) be engaged with the mr program (no need to be when you have an anchor that lasts forever) and b) pay annual fees to maintain transferability like the green. Paying annual fees encourage spending in that program, in order to justify keeping it. If the cards get cancelled, that consumer probably wasn't making the bank enough money to begin with
The number of people who maintain an ink plus or sapphire preferred to keep transferable points partners may well be more than the savings they would get from selling cheaper points and miles
Banks can reduce the statement credit liability down to below 1 cent per point.
Membership rewards points are already below one cent each, so that does not cannibalize the blue cash everyday
Using ultimate rewards or Mr at Amazon have both been devalued below the 1 penny per point threshold.
Points for merchandise is marked at msrp, which I doubt a bank would pay. Their net cost per point would be less
When I used to work for an independent hotel, it would cost us 25 percent to sell a room on expedia or most other online travel agencies. Since Chase and amex run their own booking portals, a consumer redeeming at 1 or 1.25 or 1.5 cents per mile for hotel rooms may not cost Chase and amex that much because they make some back on the backend.
Green hasn't been very appealing for a long time, and Gold hasn't since they nerfed the roadside assistance on it. PRG and Platinum aren't bad at all, for the right customer. Maybe Amex was worried that too many people would switch away from Green/Gold to no-AF 2% cards?
With ED, Amex doesn't need to pay a big bonus, and Amex maintains a good gross margin on spending (merchant fees less rewards paid). When I had EDP, the 50% bonus definitely made it my primary card.