Dear Chase – Please Compete With AMEX and Capital One’s New Bonus Categories. Love, H.
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I’ve always said: When banks compete, you win. AMEX wowed us with 4X AMEX Membership Rewards points on dining at US restaurants and up to $25,000 per year at US supermarkets (then 1X) on the new American Express® Gold Card. Even Capital One offers unlimited 4% cash back on dining and entertainment with the Capital One® Savor® Cash Rewards Credit Card.
Chase has been resting on their laurels and bonus categories with the Chase Sapphire Preferred® Card and Chase Sapphire Reserve® for years now. Those cards formed the backbone of many travel cards we see today. And while they’re still solid, is it time for Chase to compete again?
I have the Chase Sapphire Reserve and have never used it at a gas station or grocery store. Come on, Chase! If you want to be my daily go-to card, you need to take a swipe at these hungry newcomers.
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Time to step off the throne and show us you still got it!
Chase Was the King of Travel Cards – Should They Be Worried?
I love sitting back and watching banks compete for a spot in my wallet. They best each other with welcome offers, annual fees, and ongoing perks all the time.
But what was once a mighty and powerful card is starting to look a little less shiny these days. I’m looking at you, Chase Sapphire Reserve (and to some extent, the Chase Sapphire Preferred).
The Chase Sapphire Reserve earns 3X Chase Ultimate Rewards points for travel and dining, while the Chase Sapphire Preferred earns 2X points in those same categories.
Plenty of cards offer bonus points for travel, so that’s moot. But AMEX took a big swing at Chase with the refreshed AMEX Gold Card, which earns 4X AMEX Membership Rewards points on dining at US restaurants, and US supermarkets on up to $25,000 per year (then 1X).
Even the Capital One Savor card earns 4% cash back on dining and entertainment. Is 4X the new benchmark for dining?
And does Chase need to add another bonus category, like grocery stores or entertainment, to keep its cards competitive?
What Chase Could Do to Hit Back
There are a few things Chase could do here. They might:
- Add a dining category to the Ink Business Preferred℠ Credit Card for business meals (there currently isn’t one)
- Add a supermarket or entertainment category to the Chase Sapphire Reserve and Chase Sapphire Preferred (that would be amazing – I’d even take 2X!)
- Increase dining rewards to 4X on the Chase Sapphire Reserve and 3X on the Chase Sapphire Preferred to directly compete with AMEX (this would be amazing too!)
- Include gas in the travel bonus category (it’s currently excluded)
- Add dining credits in addition to the current travel credit on the Chase Sapphire Reserve (like AMEX did with the AMEX Gold Card)
- Introduce offers you can add to your cards, like AMEX does with AMEX Offers
However, Chase said they lost $300 million (!) with the introduction of the Chase Sapphire Reserve. So they may not be keen on awarding more points, credits, or benefits for a while.
But Does Chase Even Need to Fight Back?
Would you rather earn 3 Chase Ultimate Rewards points or 4 AMEX Membership Rewards points?
That’s the ultimate question here. I’d personally rather have the Chase points. Because as long as Hyatt keeps its current award chart where award rooms start at 5,000 Hyatt points, I can stay at Hyatt hotels with an instant 1:1 transfer from my Chase Sapphire Reserve.
Plus, Chase has more useful domestic airline travel partners (United Airlines and Southwest). I’ll take United Airlines’ award chart over Delta’s non-existent one any day.
And I’d much rather have 3 Chase points than 4% cash back with the Capital One Savor card. That’s because the points you earn with the Chase Sapphire Reserve are worth 1.5 cents each toward travel, which is effectively 4.5% back (1.5 X 3%). So, no question there.
And AMEX shot themselves in the foot by limiting bonus points to US restaurants and US grocery stores. What?! These cards are supposed to be for travelers – and that’s exactly what Chase already has. I don’t want to remember to swap my cards out when I travel. Instead of paying 2 annual fees, I’d rather have the card that can travel with me anywhere.
So I’m not entirely sure Chase has to respond to AMEX or Capital One (and is Citi even in this fight any more?).
If anything, awarding extra points for dining, or adding a new bonus category would be throwing us a bone.
But – and banks know this term well – being “top of wallet” is what every card strives to be. I still use other cards for gas, grocery shopping, and entertainment purchases. Not to say my Chase Sapphire Reserve doesn’t get a heavy workout, because travel and dining tend to the be bulk of my spending. While it’s always in my wallet, it’s not the card I reach for every time.
And that should be reason enough for Chase to step up their game.
Chase laid the groundwork for a successful travel card with the Chase Sapphire Reserve and Chase Sapphire Preferred. And while other banks, like AMEX with the AMEX Gold Card and Capital One with their Capital One Savor card, tried to close the gap, Chase is still sitting pretty with extremely solid card products.
Chase simply offers the most valuable rewards. And you can earn bonus points worldwide, instead of dealing with AMEX’s short-sighted US-only restriction. And earning points for award travel beats cash back because travel is a more valuable reward for lots of folks – myself included.
Still, I’d like to see Chase close the gap with other cards. Whether they need to, or if they can even afford it, is an entirely different story.
What do you think?
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