Should You Spend $60k on the Marriott Bonvoy Business Amex to Earn a Second Free Night?
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The Marriott Bonvoy Business® American Express® Card is now twice as nice for those who value free-night awards. The card recently started offering an extra free night for those spending $60,000 or more annually on the card.
The cobranded hotel card, which currently carries a welcome bonus of 100,000 Marriott Bonvoy points after you use your new Card to make $5,000 in purchases within your first 3 months of Card Membership. Earn up to $150 in statement credits within your first 6 months of Card Membership for all eligible purchases on your Card on U.S. Advertising in select Media. Plus receive complimentary Marriott Bonvoy Platinum Elite status for one year (February 1, 2021-January 31, 2022). Offer ends 1/13/21. Marriott Bonvoy Business awards card holders a free-night certificate on each anniversary. No action is required to earn that night, which can be used for a room valued at up to 35,000 points — enough for a Category 5 night based on Marriott's award chart.
While the card's annual fee has increased from $95 to $125 (see rates & fees), there are plenty of ways to get great value using your free-night awards. I counted 13 St. Regis properties that classify as a Marriott Category 4 or 5, and an even greater number of Ritz-Carlton properties fall into Category 5 or lower.
On the other hand, the second "free" night isn't exactly free. A card holder earns it when they spend $60,000 in a calendar year. The Marriott Bonvoy Business is not the first card to offer a second award night for $60,000 in spend. The Hilton Honors American Express Business Card offers free weekend nights at the $15,000 and an additional $45,000 levels of spending.
But should a small business put $60,000 on the Marriott business card with a second free night in mind? Or does it make more sense to use a different strategy? Let's take a look at the value of that free night and some earning options on alternative business cards.
The Value of a Second Free Marriott Night
According to TPG's latest valuations, a single Marriott point is worth 0.8 cents. That means a Category 5 certificate (good for up to 35K points per night) is theoretically worth up to $280 (35,000*.08). Category 5 hotel nights can cost even more than that depending on the property and time of year.
This Marriott credit card earns 4x points for sales at US restaurants, gas stations, wireless telephone services and shipping. Marriott Bonvoy hotel stays earn 6 points per dollar, and non-bonus spend generates 2 points per dollar. As a result, no purchase earns less than 1.6 cents per dollar if you peg each point at 0.8 cents.
So a business that spends $60,000 without any category bonuses would get 120,000 Marriott points, worth around $960. Take that plus $280 (our estimated value of a free night), and you get $1,240 of estimated value for $60,000 in spend, a ~2% return. A small business would earn 150,000 points — an extra 30,000 — if it were to spend 25% of that same $60,000 in 4x bonus categories.
To appraise the latter example, 150,000 Marriott points are worth roughly $1,200. Tack on the $280 from the free night certificate and you're looking at around $1,480 in value for that same $60,000 spend. That's about a 2.5% return on spending, which is excellent for bonus category charges.
The Value of Putting $60,000 on Other Cards
Question: What cards earn you a 2.5% return on spending? Answer: Not many.
Among business cards, one might consider another American Express option, the Blue Business®️ Plus Credit Card from American Express, which earns 2 Membership Reward points per dollar on the first $50,000 of purchases per account year (then 1 point per dollar). So for $60,000 in spend, a business would earn 100,000 MR points for the first $50,000 and another 10,000 for the final $10,000, totaling 110,000 points. Membership Reward points, however, are worth more than Marriott points, carrying a TPG valuation of 2 cents per apiece. With that valuation, 110,000 Amex points are worth $2,220, over $500 more than the rewards earned by the business owner using the Bonvoy Business card exclusively.
The Ink Business Preferred Credit Card also warrants consideration as a Bonvoy Business alternative. The Ink earns 3 Chase Ultimate Reward points per dollar spent (up to $150,000 per year) in an array of categories, such as travel, shipping purchases, internet/cable/phone and online advertising with social media sites and search engines.
Like Membership Reward points, Chase's Ultimate Reward points hold a 2-cent-per-point valuation according to TPG. So a business owner who puts all company expenses into non-bonus spend groups would earn 60,000 points on $60,000 spend — a value of $1,200. But most businesses spend heavily in the card's bonus categories. If you were to spend 25% in any of those bonus categories, you would earn 90,000 Ultimate Reward points (45,000 UR points base and 45,000 UR points at 3 points per dollar on the final $15,000). All told, 90,000 UR is worth roughly $1,800, more than the estimate from the Marriott Bonvoy after factoring in the second night.
Value From Focusing on New Cards and Minimum Spends
If someone were to open a handful of cards with welcome bonus thresholds totaling $60,000, the up to $1,480 in value that we arrived at for the Bonvoy Business would not be competitive. Many cards require spending between $1,000 and $3,000 to earn a welcome bonus, leaving room to earn hundreds of thousands of points for meeting minimum spend if you could open 10 cards a year. But that is not prudent or possible for many readers, so let's look at this another way. The welcome bonus route is a great option for those who might fall short of earning the Marriott Bonvoy Business Amex's second free night criteria, but who are interested in getting similar value, albeit with different loyalty currencies that offer their own sets of redemption options.
A quick look at The Points Guy's top business cards for 2019 reveals that it likely takes just two or three welcome bonuses to achieve value comparable to that earned from $60,000 in spend on the Marriott business card. The Marriott business card's welcome bonus comes with approximately $900 of value, and other cards on TPG's list range from $500 in value per TPG valuations (not issuer provided) to $1,600 (e.g. Ink Business Preferred Credit Card), with plentiful options in between (such as the Southwest Rapid Rewards Premier Business Credit Card with $900 in value.
The Marriott Bonvoy Business American Express Card is a great card that has even more potential value now that you can earn a second free night award after spending $60,000 in a year. Opportunity cost is a frequent factor we have to consider in the points and miles hobby, and compelling arguments can be made both for and against spending $60,000 on this card. Readers should think twice about going for the second free night if doing so would cost them another welcome bonus, which can easily offer more value than the second free-night award, depending on how you use the points or miles.
For rates & fees of the Marriott Bonvoy Business Amex, click here.