Hilton Rumor: A New Way to Use Points and It’s Actually Pretty Good

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Hilton Rumor: A New Way to Use Points and It’s Actually Pretty Good

Scott LiebermanHilton Rumor: A New Way to Use Points and It’s Actually Pretty GoodMillion Mile Secrets Team

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OK my Million Mile Secret agents, apparently Hilton is asking folks who have their credit cards how excited they’d be if they had a new option for using Hilton points.

Here’s the deal:  currently Hilton points tend to be worth about half a cent each when you use them to book Hilton hotels.  But what if you could ALSO get .5 cents each for Amazon purchases?  If Hilton follows through, these cardholders could turn Hilton points in to Amazon purchases:

I think there’s a very real possibility this feeler Hilton sent out becomes a reality.  I’ll explain.

Hilton Might Be Onto Something Big by Enabling You to Use Points at Amazon in Addition to Their Hotels

Turning Hilton Points Into Amazon Purchases Makes Sense for Hilton

I don’t know the specifics of Hilton’s co-brand deal with American Express.  But… typically the company that supplies the travel points (in this case, Hilton) makes a lot of money when people use their credit cards.

For instance, the Southwest Airlines CEO has talked about how profitable the Southwest credit cards are for the airline on their earnings calls to investors.  So it makes sense that Hilton wants to make more money from their credit cards by encouraging you to use the Hilton cards more often.

I think this move could benefit Hilton in multiple ways:

  • people with a Hilton credit card AND a cash back credit card will now have a reason to use the Hilton card more often
  • Hilton cardholders who aren’t in love with collecting Hilton points as much as they thought would use their credit cards more often because they have another easy way to liquidate their points
  • when customers use their Hilton points at Amazon, they’re not using them for free stays at Hilton, making more rooms available for sale
  • some people might feel they’re getting a better deal by saving money at Amazon, yet they still like their Hilton perks.  So instead of using Hilton points to book award rooms, they use their Hilton credit cards for more paid Hilton stays to earn more Hilton points to save more money at Amazon.  It’s a profitable circle for Hilton.

A Hilton Credit Card Versus Cash Back Credit Card Example

Plenty of people have a cash back credit card like the outstanding Capital One® Savor® Cash Rewards Credit Card.  They use it for 2% cash back at grocery stores.  Well, now you might consider using your Hilton Honors American Express Ascend Card to earn 6X Hilton points per $1 on purchases at US supermarkets instead.

Math:

  • $1,000 at grocery stores with Savor yields $20.
  • $1,000 at US supermarkets with Hilton Ascend yields 6,000 Hilton points which is worth ~$30 towards a Hilton award booking.  But if this Amazon thing happens, it’s $30 guaranteed at Amazon.

Me?  I’m probably taking $20 unrestricted cash versus ~$30 restricted to Hilton.  But $30 at Amazon OR Hilton?  Now I’d have to think about it.

Hilton Credit Card Comparison

I imagine you’re reading this because you’re a fan of Hilton.  The fastest way to Hilton award stays is by earning a welcome bonus.  You’re allowed to have one of each of the Hilton American Express cards.

A quick rundown:

  • Hilton Honors Ascend offers 125,000 Hilton points after spending $2,000 on purchases in the first 3 months of opening your account. Complimentary Gold elite status.  And you get 10 complimentary visits to Priority Pass airport lounges each year for your fill of free food, coffee, adult beverages, WiFi, and more.
  • Hilton Honors American Express Business card has the same Priority Pass benefit and a strong welcome bonus too, plus it grants you Gold elite status.
  • Hilton Honors American Express has no annual fee.  I actually make money on this card.  Because with it you get access to AMEX Offers (discounts that appear in your online account).  For instance, just the other day I saved $50 at Sunglass Hut just by using this credit card.  Other discounts I’ve had were at restaurants, flights, etc.  All the Hilton American Express cards have this feature.

 

Hat tip: onemileatatime.com

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Hilton Honors American Express Ascend Card

Hilton Honors American Express Ascend Card

  • Earn 125,000 Hilton Honors Bonus Points with the Hilton Honors American Express Ascend Card after you use your new Card to make $2,000 in eligible purchases within the first 3 months of Card Membership.
  • Earn a Weekend Night Reward from Hilton Honors after you spend $15,000 on purchases on your Card in a calendar year.
  • Earn 12X Hilton Honors Bonus Points for each dollar of eligible purchases charged on your Card directly with a hotel or resort within the Hilton Portfolio.
  • Earn 6X Hilton Honors Bonus Points for each dollar of eligible purchases on your Card at U.S. restaurants, U.S. supermarkets, and U.S. gas stations.
  • Earn 3X Hilton Honors Bonus Points for all other eligible purchases on your Card.
  • Spend $40,000 on eligible purchases on your Card in a calendar year and you can earn Hilton Honors Diamond status through the end of the next calendar year.
  • $95 annual fee.
  • Terms Apply.
  • See Rates & Fees
Terms Apply | Rates & Fees

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Exciting and not shocking. 2 things.

1. Amex currently has an Amazon business card offering 5% cashback with no annual fee.

2. There is a current Amex promotion offering 10 Hilton points per dollar spent on Amazon up to $500.

So we know what they’re able to do. Those being the case, if they made that 10x on Amazon permanent, which would result in the same basic cost as their 5% CB card, then I would absolutely switch my Amazon spending habits to my Hilton card as that provides the equivalent of the 5% CB I’m already used to getting through Amazon, but also allows the flexibility of using those points on hotel rooms.

Author

Great analysis, Josh. Agreed, this makes total sense for AMEX. Let’s hope they listen to customers like you!