By Robert McGarvey
File this American Express innovation under not for me.
The travel press is abuzz that Amex has rolled out a new feature where you can spend your membership rewards points to bid for upgrades on your existing airline reservations.
According to Skift: “Twenty-one airlines including Air Canada, Qantas, and Singapore Airlines have partnered with Plusgrade and American Express to launch the product. Currently, no U.S.-based airline is part of the program, but several North American carriers participate.”
Of course you’re familiar with similar with the many airlines points programs you belong to.
But here’s the difference: Amex points still have a kind of value whereas airline points, as vividly documented in multiple columns by Joe Brancatelli, lose value just about daily. With airline points the wise soul burns ‘em as they are earned.
Amex points are a bit better.
I still have a stash of Amex points, hundreds of thousands, I don’t know how many because I don’t spend them. I will and I have but I am stingy with them because they can rather easily be converted into plane tickets on multiple carriers, even for short notice travel (visiting ill friends and relatives for instance).
Should I play with Amex’s upgrade offer?
It works like this: visit Upgrade with Points in the MembershipRewards page. Select your airline, input your rez to see if it’s eligible, if eligible bid for the upgrade, twiddle your thumbs until you hear if the airline has accepted your offer.
The official Amex spiel is here.
Some journos like the Amex program. Said Godsavethepoints: “This is cool because it often works even when you’re traveling on the lowest priced economy fares, and sometimes the accepted bids can be super low. Now that Amex has partnered with Plusgrade, you don’t even have to bid using your cold hard cash, you can bid using your Amex points instead.”
Count me as not enthused about it however.
Sure, if you have time to kill (sitting in an airport lounge for instance) and feel mischievous, put in a bid of 1 membership reward point. If the airline accepts it, pat yourself on the back.
But most – possibly all – airlines will have a minimum bid, just as they do for cash bidding schemes. They are not chumps and they won’t let us turn them into chumps.
That means very probably you will have to bid substantial chunks of miles and color me unpersuaded that this is a good use of those hard earned miles.
Skift dug into the mechanics and reported back that “Reached for comment, a member of the team at American Express confirmed that through the program, 1,000 Membership Rewards points would equal $10 in upgrade credit. For a $400 bid, a reasonable offer for a short-haul upgrade, it would thus cost an American Express customer 40,000 points. Those same 40,000 Membership Rewards, however, could also be deposited into a frequent flyer account directly through a transfer partner and be used to book an economy or premium ticket (a one-way, first-class, domestic ticket on a legacy U.S. carrier typically costs 25,000 miles).”
Onemileatatime calculated that probably Amex cardholders who bid miles in this program would get a value return of “0.5-1 cents of value per point, which isn’t great.”
Nope, it isn’t. Onemileatatime calculates the value of an Amex mile at nearer 1.7 cents per mile and that is substantially more.
The Points Guy says he values Amex miles at two cents apiece.
Milestomemories gave its verdict on the scheme in its headline: “Amex Introduces New Program That Sounds Great But Offers Terrible Value.”
The verdict: Save your membership rewards miles for better, more generous uses.