Amex article "Amex is losing its millionaires"

[happypill]

There's been a lot of discussion on this subject around myFICO recently.  This article is from Bloomberg Business and discusses many of the same themes that members here have been discussing.  Hope it's OK to include a link:

http://www.bloomberg.com/news/articles/2015-02-12/amex-grip-on-wealthy-consumers-seen-slipping-as-ri...

[Anonymous]

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@happypill wrote:

There's been a lot of discussion on this subject around myFICO recently.  This article is from Bloomberg Business and discusses many of the same themes that members here have been discussing.  Hope it's OK to include a link:

http://www.bloomberg.com/news/articles/2015-02-12/amex-grip-on-wealthy-consumers-seen-slipping-as-ri...

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This has been posted already under "credit in the news section" last week.

[CreditCuriosity]

I think Amex will be just fine.  Despite Jet Blue and Costco.. Sure other companies are knocking on their doors to be co-branded.  Also "most" big companies use Amex Plat charge as their goto corporate card still.

[Open123]

Not sure if it was intentional, but the Hedge Fund guy asserting the difference between 2% and 1% cashback is quite misinformed.  I surely hope he's better at securities valuation than his assessment on rewards valuation.

Again, to reiterate, the value for Amex expenditures are as followings:  (1) no caps on non-bonus expenditures; (2) MR and SPG opportunistic redemptions with a 2% - 4% comparitive cash value; and, (3) periodic MR bonus transfers to AA partners.  Even now, for travel redemption, for uncapped non bonus expenditures, nothing (maybe UR via Ink Plus) is comparable to MR and SPG points when earned prudently, such as with the 50% bonus EDP.

For purely cash, the article is spot on.  You'd imagine a Hedge Fund manager should easily understand and appreciate this nuance.

PS - I do think the JPM Ritz has supplanted the Amex Plat in terms of value vs. benefit valuation.  I've discarded my personal Plat for the JPM Ritz, which has the best value in terms of benefits vs. fee (not spend rewards), in my view.

[Anonymous]

There is definitely truth in this.  A friend of mine had been a 20+ year AMEX card holder, easily hits 100K-125K a year through that particular card.  He felt like AMEX was taking away perks a little here and a little there, so he switched over to the Ritz card and the Barclays WEMC.  Even though the AF of the AMEX is pocket change to him he just said enough was enough.

[Open123]

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@Anonymous wrote:

There is definitely truth in this.  A friend of mine had been a 20+ year AMEX card holder, easily hits 100K-125K a year through that particular card.  He felt like AMEX was taking away perks a little here and a little there, so he switched over to the Ritz card and the Barclays WEMC.  Even though the AF of the AMEX is pocket change to him he just said enough was enough.

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A much bigger threat to Amex in the short term is increasing number of small to medium size businesses discarding Amex in favor of Chase.  

For most businesses, it's difficult to argue against the best in class value offered by the Chase Ink cards, especially with the 5X UR points on cell/office expenditures.  I've seen many businesses over the past 5 years switch from Amex entirely to using Chase Inks.  Our Firm uses both Chase and Amex, but many prefer to simply go with Chase.  I'm one of the few in our Firm who value MR and SPG points, and fight every year to convince my business Partners that it is still worthwhile to pay for using Amex almost exlusively.

I've had to go to great lengths to show those around me how to maximize their MR and SPG points to keep Amex as our main business cards.

[SunriseEarth]

This thread is locked; please see similar thread for further discussion:

http://ficoforums.myfico.com/t5/Credit-in-the-News/AMEX-losing-high-net-worth-customers/td-p/3799428