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Reader Nick asked the following question on a recent post about my American Express card strategy:
I know it’s speculation, but what do you think happens to the Starwood AMEX card post-merger? In the meantime, I’ve had the card once and can’t qualify for a bonus again. But wouldn’t you agree others should apply, especially since even the minimum 25K SPG point signup bonus equals 75K Marriott Rewards with no first-year fee?
While I’ve addressed this topic in passing, I figured it would make sense to dedicate a post specifically to this:
What Marriott wants the future of SPG to look like
While I’m not thrilled about Marriott’s takeover of Starwood (eliminating competition is rarely good for consumers), there’s no denying they’ve done an incredible job in terms of offering reciprocity quickly. The day the merger closed they introduced reciprocal status matching and points transfers. That’s extremely impressive, especially given the scale of the merger.
At the moment Marriott is happy running the three loyalty programs — Marriott Rewards, Ritz-Carlton Rewards, and Starwood Preferred Guest — independently. Marriott management has said that they’re eventually hoping to create a single loyalty program, and that will happen in 2018 at the earliest.
That’s all we know as of now. So we could see the programs integrated as early as next year, though I also wouldn’t be surprised if it only happens in 2019. I get the sense that Marriott management is taking their time, and would rather do things correctly than quickly.
What the Marriott merger means for credit card issuers
Marriott and Ritz-Carlton cards are issued by Chase, while Starwood cards are issued by American Express. For the time being it’s “business as usual” for both American Express and Chase.
Once the programs integrate, or once we get a sense of the timeline with which programs will integrate, that will likely change. What could we see happen?
- American Express could take over the entire agreement for the combined program
- Chase could take over the entire agreement for the combined program
- It’s not out of the question that both American Express and Chase will issue cards for the new program; American AAdvantage, the world’s largest airline loyalty program, now has cards issued by both Citi and Barclaycard, and Hilton has credit cards issued by American Express and Citi, so we can’t rule out the possibility of this happening with Marriott
If Marriott does decide to go with one issuer over the other, I could see it going either way.
It could very well be Chase, given their overall strength with co-brand cards, the fact that Marriott is part of their transferrable points currency, etc. Amex might seem like the underdog on the surface, given that Marriott’s previous arrangement was with Chase and they’re the “dominating” company, but I wouldn’t rule them out. They took a big hit in losing the Costco co-brand agreement, so might go to great lengths not to lose another big partner.
Why you might want to consider the SPG Amex
Both the Starwood Preferred Guest® Credit Card from American Express and Starwood Preferred Guest® Business Credit Card from American Express offer sign-up bonuses of 25,000 Starpoints upon completing minimum spend, with the first year’s annual fee waived. The card also offers one Starpoint per dollar spent, and two Starpoints per dollar spent for stays at any of Marriott’s 30 hotel brands.
Given that Starpoints can be converted into Marriott Rewards points at a 1:3 ratio, this means:
- The sign-up bonus is worth 75,000 Marriott Rewards points
- The card offers three Marriott Rewards points per dollar spent, which is much better than the one point per dollar spent offered on the Marriott Card
- The card offers six Marriott Rewards points per dollar spent at Marriott properties, which is better than the five points per dollar offered on the Marriott Card
On top of all that, these cards are anecdotally easy to get approved for. Getting approved for Marriott’s card can be tough since it’s subjected to Chase’s 5/24 rule, while most people should have no issues getting approved for the above two cards.
Does that mean you should apply for the SPG Amex?
If you don’t yet have the SPG Personal Amex or SPG Business Amex, you absolutely should consider getting them at some point. The cards are easy to be approved for, and the sign-up bonus alone will get you 25,000 Starpoints, which can be converted into 75,000 Marriott points.
If you’re someone who presently uses a Marriott card for everyday spend, you may also be interested in earning three Marriott Rewards points per dollar spent, and six points per dollar spent on Marriott-family hotel stays.
The one reason you may consider holding off is because historically Amex has offered a once-per-year increased sign-up bonus on the card. Last year the bonus was increased to 35,000 Starpoints, while in 2015 it was increased to 30,000 Starpoints.
There’s certainly a chance the bonus will be similarly increased this year, though it’s no guarantee. Everyone can decide for themselves whether or not it’s worth waiting for that bonus. The last “special” bonus that Amex offered on the SPG Card was actually worse than the normal bonus, in my opinion.
The SPG Personal Amex and SPG Business Amex were among the first cards I ever applied for. While we don’t yet know what the future of SPG looks like, as of now it’s “business as usual” on these cards. That could change at some point, though if you haven’t yet picked up these cards, I’d seriously consider doing so. They’re quite easy to get approved for in my experience, and are great regardless of whether you’re looking for airline miles, Starpoints, or Marriott Rewards points.
The only other consideration is that we may see an increased bonus on the card again this year.