AmEx Sweetens Premium Card Rewards, Again, With New Uber Perks
(Bloomberg) -- American Express Co. boosted the perks on some of its premium cards once again as the card issuer tries to keep a lid on attrition during the coronavirus pandemic.
Consumers with the firm’s platinum, gold and green cards will have free access to Uber Technologies Inc.’s Eats Pass -- a subscription that typically costs $119 a year and offers discounts on the company’s food-delivery service. Gold-card customers also will receive $10 a month in Uber Cash, which can be used toward rides or food delivery, starting early next year.
“Our card members crave food experiences and we’re seeing that they’re continuing to seek out food-delivery services to create those special experiences at home,” Rachel Stocks, AmEx’s executive vice president for global premium products and benefits, said in a statement Monday.
AmEx, long known for its premium travel and dining perks, has seen spending on its cards suffer during the pandemic as consumers have stayed home to stem the spread of Covid-19. That’s led the card company to quickly revamp some of its most popular cards to avoid losing customers.
The effort seems to be working: Voluntary attrition rates on AmEx’s proprietary cards remain lower than they were a year ago. Net card fees climbed 15% to $1.2 billion in the third quarter, the only category of non-interest income to increase.
The changes ratchet up pressure on rivals JPMorgan Chase & Co. and Citigroup Inc. to consider changes to their own premium products. Consumers in recent years have flocked to such cards, often paying more than $500 a year to take advantage of their extra rewards and prestige.
AmEx’s stock has dropped 8.5% since Thursday, after the company reported third-quarter earnings that missed analysts’ estimates on Friday and warned it would spend more on marketing and business development in the fourth quarter than analysts had been anticipating. AmEx Chief Executive Officer Steve Squeri defended the moves, saying they would position the company better for the future.
“A lot of our card members are fee-paying card members and they are sticking with us because, No. 1, we continue to invest in the relationship and, No. 2, we continue to provide the best service in the industry,” he said.
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