Downward Trend in Referral Offers

[exceladdict]

Hot on the heels of the Worst shop small ever?, the Amex QF Ultimate referral offer has dropped to 55,000 with no end date (avoiding a link here, as they live in the Referral Offers forum).

This card has previously hit or exceeded 120k points, with SCs or even cashbacks offered as well. Yes, the $~450 annual fee is offset by the $450 QF flight credit "if you were going to be flying anyway" but I worry that the trend is not looking good for us... erm.. 'practiced' applicants:

• January through March: 110k points for 3k spend, 30k for referrer
  • Noting some (seemingly new referrers?) had a 130k offer with 50k for the referee
• April: 120k / $3k spend; 40k for referee
• May: 110k / $3k / 40k
• June-August: 100k points split into 75k first + 25k second year
• To 19 Oct: 75k points
• 2 Nov on: 55k, undated

The referral offers are usually similar to those offered via partners like qantas, finder or point hacks, or other affilliates - all of which are showing the 55k at time of writing

Do we think this is a different approach from amex marketing in AU?

 

[Doctore1003]

Like I commented in the Shop Small thread, I read an article recently about how credit card demand is very strong right now, so that could be translating into lower sign-up bonuses. Some other card issuers have also lowered their bonuses - it's not just Amex.

 

[exceladdict]

Like I commented in the Shop Small thread, I read an article recently about how credit card demand is very strong right now, so that could be translating into lower sign-up bonuses. Some other card issuers have also lowered their bonuses - it's not just Amex.

Fair point. I'm encouraged that some (anz black) are still 110k+ instead of being multi-year offers.

 

[blastoise]

Like I commented in the Shop Small thread, I read an article recently about how credit card demand is very strong right now, so that could be translating into lower sign-up bonuses. Some other card issuers have also lowered their bonuses - it's not just Amex.

Everywhere including USA is experiencing downturn, there was some YouTube video explaining it all very well. ANZ used to be 160k and now 110k and min spend requirement have also increased for a lot of banks.

 

[exceladdict]

Everywhere including USA is experiencing downturn, there was some YouTube video explaining it all very well. ANZ used to be 160k and now 110k and min spend requirement have also increased for a lot of banks.

It's interesting to consider though, and not working in the finance industry I wouldn't know which of these arguments is stronger in an inflation + low wages growth environment:

• Higher prices = more dollars through cards for same basket = more interchange revenue = less need to acquire new customers
• Pressure on consumers = more spending on credit cards = more revenue from interest + demand for credit = less priority to acquire new customers through sign up bonuses
• Pressure on consumers = less credit card spending = less interchange revenue from existing customers = more sign up bonuses to get new customers

I read an interesting article arguing about redistributive effects of credit card reward programs and that it's those who pay their cards off who benefits most from spending. An interesting angle, even with our better interchange regulation in AU.

 

[NoName]

There is no way I would consider one of these Amex cards for a low bonus like that. Just isn’t worth having to restart the sit out period for such a small number. I’m ready to go for another Explorer card but it will have to be a minimum of 100,000pts to get me to pull the trigger.

 

[Daver6]

Are we talking about sign-up offers or referral offers here? Two very different beasts.

Agree that the QF Ultimate sign-up offer is very poor. MrsDaver6 has sat out the 18 months but hardly worth it for that offer.

I also note that on the Plat Charge card, when the 2-1 points devaluation happened a few years ago, the sign-up bonus points remained roughly the same. Ie halving in value too.

 

[blastoise]

It's interesting to consider though, and not working in the finance industry I wouldn't know which of these arguments is stronger in an inflation + low wages growth environment:

• Higher prices = more dollars through cards for same basket = more interchange revenue = less need to acquire new customers
• Pressure on consumers = more spending on credit cards = more revenue from interest + demand for credit = less priority to acquire new customers through sign up bonuses
• Pressure on consumers = less credit card spending = less interchange revenue from existing customers = more sign up bonuses to get new customers

I read an interesting article arguing about redistributive effects of credit card reward programs and that it's those who pay their cards off who benefits most from spending. An interesting angle, even with our better interchange regulation in AU.

Great article, and another Perthian on here!

You would think like you said that more pressure would mean more incentives to attract customers, but maybe they went overboard in sign up bonuses this year like ANZ etc. And then Citibank going overboard with velocity on their loans haha

 

[exceladdict]

Are we talking about sign-up offers or referral offers here? Two very different beasts.

Agree that the QF Ultimate sign-up offer is very poor. MrsDaver6 has sat out the 18 months but hardly worth it for that offer.

I also note that on the Plat Charge card, when the 2-1 points devaluation happened a few years ago, the sign-up bonus points remained roughly the same. Ie halving in value too.

I'm broadly lumping them together because usually the referral offer is the same as the best offer in the market at the time. But, even without referrals, the sign up bonus has been at a long term low for quite some time now.

Great article, and another Perthian on here!

You would think like you said that more pressure would mean more incentives to attract customers, but maybe they went overboard in sign up bonuses this year like ANZ etc. And then Citibank going overboard with velocity on their loans haha

Could be the case - let's hope they uptick in the new year!

 

[exceladdict]

Have just seen an "exclusive" bonus offer on the qf ultimate in a while via an affiliate partner, 75k first year / 25k second. Valid through 31 jan so perhaps better / single year offers will emerge after that.

If anyone holds the card, is the referral offer back over the baseline 50k or so?

 

[blastoise]

Have just seen an "exclusive" bonus offer on the qf ultimate in a while via an affiliate partner, 75k first year / 25k second. Valid through 31 jan so perhaps better / single year offers will emerge after that.

If anyone holds the card, is the referral offer back over the baseline 50k or so?

Legend, thanks for posting this! I'm usually not a fan of annual fees (I try and get for as low as possible), but the low spend requirement is a winner in my eyes

 

[Daver6]

Have just seen an "exclusive" bonus offer on the qf ultimate in a while via an affiliate partner, 75k first year / 25k second. Valid through 31 jan so perhaps better / single year offers will emerge after that.

If anyone holds the card, is the referral offer back over the baseline 50k or so?

 

[exceladdict]

Legend, thanks for posting this! I'm usually not a fan of annual fees (I try and get for as low as possible), but the low spend requirement is a winner in my eyes

Yeah, plus the flight credit offset is a bonus - I'm a fan of this card. But i'll likely hold out for an 100k+ first year bonus, and hopefully it will come out as a referral offer so we can give 30-40k bonus points to someone else on the forum instead of a kickback to an affiliate site.

 

[blastoise]

Yeah, plus the flight credit offset is a bonus - I'm a fan of this card. But i'll likely hold out for an 100k+ first year bonus, and hopefully it will come out as a referral offer so we can give 30-40k bonus points to someone else on the forum instead of a kickback to an affiliate site.

I get it's an offset but depends on routes. Perth to Brisbane or Adelaide even is showing up as 750 to 800 dollars for Virgin or Qantas. Totally agree that 100k should be on the cards, but I guess we take what we can get in this downward trending climate

 

[Doctore1003]

I think this 75k/25k offer is as good as it’s going to get for a while. There’s no pressure from competitors to offer bigger bonuses, plus everyone is keen to travel and so demand for frequent flier credit cards is high.

 

[exceladdict]

Other affiliates have jumped on board now, with the 75/25 offer at point hacks and finder, both expiring 31 Jan. Not listed on the Qantas cards webpage (yet).

 

[Doctore1003]

Other affiliates have jumped on board now, with the 75/25 offer at point hacks and finder, both expiring 31 Jan. Not listed on the Qantas cards webpage (yet).

It's exclusive to Amex affiliates so won't be listed on the Qantas cards page.

 

[levelnine]

Still a trifling offer. Along with NAB's tightening of the belt on the credit card front, it might be a leaner year for sign-up offers.

 

[lang_13]

Almost at end of 18 months sitting on sidelines myself. Highest sign-up offer I noted since I cancelled was in Nov 21, with Explorer offering 240k and Platinum 300k MR points. Current bonuses seem paltry in comparison. Not inclined to apply again until offer improves.

 

[burmans]

Like I commented in the Shop Small thread, I read an article recently about how credit card demand is very strong right now, so that could be translating into lower sign-up bonuses. Some other card issuers have also lowered their bonuses - it's not just Amex.

I think in this case extrapolating the past to the future is very dangerous. Articles like this rely on statistics which are always (by definition) backward looking. There is no question that we have recently been in a ‘free money’ environment, lots of money available and plenty looking to take advantage of that.

But things are changing fast with recent rate rises, banks are going to be much tougher in assessing credit and ability to pay in this environment. With people struggling to pay even their current debts there might be more demand for CCS but that doesn’t mean the banks will give it. This is exactly the environment where banks will start to struggle to grow lending and accordingly will seek quality applicants.