Keeping up with ever-shorter rewards promos
Credit card deals and bonuses that last for as little as one day are on the rise
Limited Time Offer! Act Now! One Day Only!
Those aren't just sales slogans from stores looking to draw
shoppers. Increasingly, credit card companies are hyping short-term ways to earn
extra reward points or to score special deals.
For consumers, the rise of deals and bonuses that last for
as little as one day can mean even more ways to save money or accumulate credit
card reward points. But the trend also means cardholders have to pay closer
attention to where to shop, when to shop and what card to use if they want to reap
the most benefits from their cards.
For card companies, offering limited-time deals makes their
cards stand out by giving customers additional reasons to use their plastic at
specific places and times. The additional rewards are often meager, but they
can be meaningful to card issuers, says Nicholas Felten, founder of the blog Personal Finance Digest.
"They want you to use their card," Felten says. "The more
you are thinking about your card, the more likely you are to use that card in
other situations. That's why they offer these targeted promotions."
Some of the recent short-term deals include:
- Retail savings.
Every Tuesday, holders of the Gap Visa card get 10 percent off Gap or Old Navy
merchandise purchased in stores or online. People who use the Nordstrom Visa
Signature card for Nordstrom purchases enjoy scheduled bonus points events -- two-
or three-day periods several times a year in which they can earn double or
triple points in the store's loyalty program. On top of that, once a year they
get to choose their own day to earn triple points on purchases made with the
card (note, however, that Louis Vuitton items are ineligible for triple
- Special access to
shows. In September, Citi sponsored a performance by comedian Jerry
Seinfeld in New York that was available only to holders of Citi ThankYou credit
cards. The tickets went on sale at 10 a.m. on a Friday, and the best seats sold
out the first day.
Other big card issuers routinely offer entertainment ticket presales before they are made
available to the general public. American Express cardholders get early access
to tickets for performances ranging from The Nutcracker to Cher.
- Dining and movie
perks. Throughout 2013, holders of the Chase Sapphire Preferred card can earn
triple points, instead of the usual double points, when they use the card at
restaurants on the first Friday of each month. And this summer, diners in New
York who used their American Express cards to pay for meals at nearly 300
restaurants as part of a "Restaurant Week" promotion received a $5 statement
credit. Visa Signature cards and Fandango also ran a promotion in which cardholders
could receive a movie ticket for free when buying one at the regular price on
Fridays during the summer.
Melanie Backs, a spokeswoman with American Express, says
offering short-term deals "creates some excitement" among the company's
cardholders, who appreciate the chance to wring more value from their cards.
"It's about showing our card members that we are relevant to
their everyday lives," she says. "You are getting rewarded for everyday
transactions and experiences that you have."
American Express will again participate in "Small Business
Saturday," a November event in which consumers are encouraged to shop at small
businesses. It's offering a $10 credit to shoppers who spend $10 or more at
small businesses on that day using an AmEx card they've registered for the
As technology improves and customer preferences evolve, the
days of signing up for a card and having its features imposed on you are giving
way to an era of increased flexibility in creating cards and exerting greater
individual control over their rewards.
you are thinking about your card, the more likely you are to use that card in
other situations. That's why they offer these targeted promotions.
|-- Nicholas Felton
Personal Finance Digest
In recent years, card issuers have tried to become more
relevant to their customers and to increase interactions with their cards. Some
banks now give customers greater control over their cards' financial features upon
applying for a new account. Some cards, such as the U.S. Bank Cash+ Visa
Signature card and the Huntington Voice card, allow consumers to specify
quarterly which categories of purchases will earn bonus points.
Keeping tabs on deals
For consumers, though, these short-term deals,
personalization and targeted offers can become complicated. To maximize your
rewards, you first have to hear about deals using social media, or via emails from
your card issuer, blogs and other sources of information -- and then remember which
card to use, when and where.
"It definitely pays off to pay attention," says Brian Kelly,
founder of The Points Guy, a site
dedicated to maximizing frequent flier miles and credit card points. "A lot of
people don't know about these offers."
Kelly suggests looking through ads in your online or printed
credit card bill and not assuming that every offer is worthless marketing
Geoff Whitmire, founder of NoobTraveler, suggests staying plugged
in by following bloggers who write frequently about rewards -- and there are
plenty of those nowadays. He also recommends following banks on Twitter, since
they often announce promotions there.
Another way to tune in to short-term rewards deals is by
using mobile phone apps such as Reward Summit or Wallaby,
which recommend what card to use with different kinds of merchants based on
available rewards, including short-term promotions. The apps are available for
iPhones and Android phones.
"Once you say you have a card, you don't have to worry about
it. Just check what card to use," says Matthew Goldman, founder of Wallaby
Financial. "Our system was built to keep track of those rewards to the individual
day and across different categories."
A simpler plan
If keeping up with steady streams of offers is overwhelming, another option is to stick with a card that has valuable and simple-to-understand
rewards and not worry about missing out on small bonuses.
"Most people aren't really into tracking this, so they might
be best off with a straightforward cash-back card," Felten says. A 2012 survey by CreditCards.com found that cash-back cards are offering more
generous rewards than in the past, but that they also tend to offer different
reward amounts based on where they are used.
Still, by offering rewards deals that expire in just a few
days, credit card companies are tapping into a deep-seated human characteristic
-- the same one that motivates consumers to jump at sales or to buy items when
quantities are limited, says Nicholas Didow, a marketing professor at the
University of North Carolina's Kenan-Flagler Business School.
While some people might honestly be looking for better
values, others are motivated to seek even small economic advantages because of
the "excitement of the hunt," Didow says.
"Some of the explanation is perhaps economically rational,
while some of it speaks to our unique characteristics that we have as human
beings," he says. "Take your pick."
See related: What’s the best low-hassle cash-back card?, Which cards can you churn for multiple rewards bonuses?, Travel rewards vs. cash back: Do you really want to be practical?
Published: October 17, 2013
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