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One important consideration for points and miles enthusiasts is figuring out where to purchase travel in order to maximize rewards. Today, TPG Contributor Richard Kerr looks at Amex Travel to help you decide whether it’s a good option for booking your next trip.
Amex has made some changes to its travel portal over the past year, as well as to related benefits on American Express cards that earn Membership Rewards points. In this post, I’ll take into account all the recent program updates, ancillary services, benefits and costs to help you decipher when using American Express Travel makes sense.
The most fundamental consideration is the cost of travel. In March I wrote about how American Express Travel generally does not offer the lowest prices. Furthermore, Amex tacks on booking fees, though these are now waived for anyone with the The Platinum Card from American Express. Airfare and package deals (flight + hotel) booked online incur a fee of $6.99 per domestic ticket and $10.99 per international ticket. Hotel and cruise bookings don’t come with booking fees when booked separately from airfare.
If all that matters to you is the bottom line, then you probably already shop around for your flights, prepaid hotels, cruises and vacation packages. Amex Travel could surprise you, but I’d say it’s unlikely to offer the best rate.
If you’re willing to pay a bit more for great service, then the value proposition changes. I’ve called American Express Travel many times, and it comes out on top by a wide margin when compared with other travel services, online travel agencies and other credit card travel portals. You can count on quickly reaching a live human who is capable of solving a problem, and that alone can be a lifesaver. I appreciate empowered customer service agents, and I hope American Express doesn’t alter this feature moving forward.
Added Hotel/Cruise Benefits
Like many cruise booking sites, American Express Travel frequently offers added perks to attract potential cruise-goers to the site. If Amex offers the most onboard credit, a free specialty dinner or other gratuities that you won’t get elsewhere, then the value may be enough to overcome any disparity in price.
Likewise, booking through American Express Fine Hotels and Resorts will give you early check-in, late check-out, breakfast, Wi-Fi, room upgrades (when available) and a unique property amenity. The prices are on par with normal rates, and in practice I have still earned hotel points and elite status credit!
If the airline or hotel that you want to book is not offered by American Express (e.g., Southwest), then obviously it doesn’t make much sense to come to the site.
With these basics scenarios covered, let’s look at American Express Travel from a points-strategy perspective.
American Express Cardholders
The general public does have access to book through Amex Travel, but American Express cardholders can get significantly more from the service. Membership Rewards cards earn one extra point per dollar spent when booking travel with American Express. Amex bills this as double points, but it really means double base points, so you don’t earn double on any spending category bonuses. That extra point is nice, but probably not enough to sway your decision of where to book.
Taking category bonuses into account, American Express Premier Rewards Gold cardholders can earn a total of 4 points per dollar when booking through Amex Travel, since the card earns 3x points per dollar on flights booked directly with airlines to begin with. That’s still just one point more than you would earn by booking elsewhere, but the overall return remains impressive.
It’s not easy to beat 4x points on travel in one transaction; the question is whether that earning rate makes using the Amex travel portal worthwhile. Obviously if prices are comparable elsewhere, then you may as well book through Amex to get the extra point. Even if you’re paying a small premium, it could still be worthwhile. For example, you might pick a flight that costs $1,010 on Amex Travel over the same flight for $1,000 on Orbitz, because the extra 1,000 points you earn are worth more than $10, as shown by TPG’s June valuations. If the premium is any higher than about 1.5%, then you’re better off saving your cash and using your Membership Rewards card where the price is lowest.
I’m a firm believer that when it comes to earning points, you should always be chasing a specific goal. Points make a terrible long-term investment, as you have no guarantee of what they’ll be worth tomorrow. If my current award-travel goal (for, say, a transcontinental flight in JetBlue Mint) can be reached more quickly by collecting Membership Rewards points, then I’m more likely to use Amex Travel to earn bonus points. Even if the price offered by Amex is higher, the cost may be offset by the value of the award.
Sometimes outside influences may force your hand. If you use American Express for business expenses, or if your small business utilizes the American Express Small Business travel tool, then Amex Travel is the obvious choice. Similarly, if you’re forced to fly Delta for all business travel, booking through the American Express travel portal to earn bonus points and then transferring your MR balance to your Delta account can make good sense.
If you’re not a Membership Rewards cardholder and the Amex Travel portal doesn’t offer the cheapest price, I don’t recommend using it. Otherwise, ask yourself the following questions (in order of importance):
- Am I willing to pay marginally more for better service?
- Am I getting added perks/benefits on my hotel or cruise?
- Are the bonus points I earn by using Amex better than other bonus points I would earn by booking elsewhere?
- Do the points earned by booking through Amex allow me to reach my current award travel goal faster?
- Can I pool the Membership Rewards points I earn together with my current points or miles?
If your answer to one or more of the above questions is yes, then the American Express Travel portal can work for you. If not, then you can be confident that there’s a better deal for you elsewhere.
What factors do you consider when using the American Express Travel portal?
Premier Rewards Gold Card from American Express
|Intro APR||Regular APR||Annual Fee||Balance Transfer Fee||Credit Rating|
|N/A||Introductory annual fee of $0 for the first year, then $195||See Terms||Excellent Credit|