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“Lucky, why hasn’t American Express Membership Rewards had a bonus for Delta SkyMiles transfers lately?”
I’ve been asked this question about once a day for the past couple of months, so I figured I’d address it here.
The short answer is “it’s anyone’s guess,” but that won’t stop me from speculating.
Historically the chances of having a Membership Rewards transfer bonus to Delta SkyMiles in a given month was about the same as getting a coupon from TGI Friday’s weekly. Both always happened. This is kind of understandable given that SkyMiles are a pretty devalued currency (they’re called “SkyPesos” for a reason), so even with a 30-50% transfer bonus Delta can still come out ahead when they’re charging 325,000 miles for business class to Europe.
So while there was hardly a month last year without a transfer bonus to Delta SkyMiles, we haven’t seen a single transfer bonus this year. To the best of my knowledge the last bonus ended on December 31 of last year.
So why hasn’t there been one so far this year? Well, it’s probably not a coincidence. Delta is American Express’ biggest airline partner, and I suspect Delta isn’t too happy about people using Membership Rewards branded credit cards to earn Delta SkyMiles instead of Delta co-branded ones. As I covered in this post, the best way to earn Delta SkyMiles is by using the Premier Rewards Gold Card from American Express, which accrues Membership Rewards points and offers triple points on airfare, double points on gas and groceries, and one point per dollar spent on everything else.
Add to that the fact that Membership Rewards often had up to a 50% transfer bonus to Delta, and the playing field was really unfair (from Delta’s perspective). As I discussed in my previous post, I was earning an average of close to four Delta SkyMiles per dollar spent on my Premier Rewards Gold card. It’s funny, because when I called to cancel my Gold Delta SkyMiles credit card last year, the retention specialist tried to convince me to keep it, reminding me I was earning two miles per dollar spent on Delta with the card. As soon as I told him I was using the Premier Rewards Gold card which offers three points per dollar spent on Delta and two points per dollar spent on gas and groceries, he gave up and quickly responded with “I don’t blame you.”
So I suspect the lack of transfer bonuses isn’t a coincidence, and that it has a lot more to do with Delta than American Express. While Delta probably likes the revenue they get from Membership Rewards transfers, I suspect they like the revenue they get from co-branded Delta cards even more, as the earnings rate is lower and not all of the miles earned will actually be redeemed (unlike with Membership Rewards transfers, where you could put a ticket on hold, transfer exactly as many points as are required, and then make the booking, minimizing unused miles).
And there could be one other factor at play. Up until last September Continental was also a Membership Rewards transfer partner, and transferring miles to them was almost always a better value than transferring miles to Delta. American Express has long favored Delta over Continental, even when both airlines were in SkyTeam, given that Continental has a separate credit card that’s co-branded with Chase. So they were really only a half-assed American Express partner.
I assume part of the reason that Delta offered transfer bonuses was to keep the miles (and therefore money) “in the family,” so to speak. It would make sense that they do what they can to encourage people to transfer miles to Delta, while still adding value to the program by having Continental as a partner for those that see value in the relationship. Now that Continental is no longer a partner, there really aren’t very many better alternatives for transferring miles, so they no longer feel the need to incentivize people to transfer miles to Delta as much.
Again, this is all just speculation on my part, though I think it would explain why we haven’t seen a transfer bonus. Does this mean we’ll never see a transfer bonus again? Nope, I’m sure we will. But I suspect they won’t be as frequent or as generous as in the past.