Yesterday I reported on the speculation that American Express was no longer offering bonuses on drugstore and telecommunications spend for their Hilton co-branded credit card products.

First I confirmed that no changes had been made to those cards at this time. The cards are indeed still earning.6 points per dollar spent in those categories.

But given the specificity of changes that Frequent Miler reported being told by American Express, I went back with a “wait — so there are no changes, but will there be changes?”

And I was promised the scoop today. And now I have the update.

Six points per dollar on drugstores and telecommunications is going away. But it is being replaced. And it isn’t going away until at least May 1. Strictly speaking the changes will go into effect for each cardmember with the first billing period that begins on or after May 1 (so folks whose statements close on, say, the 28th of the month will have until May 29 to earn the bonus).

So effective May 1 (and for all cardmembers, the statement beginning on or after May 1), here’s what the new earn rates for the cards will look like.

Hilton HHonors Card

  • 7 points per dollar at Hilton Worldwide properties
  • 5 points per dollar at U.S. restaurants
  • 5 points per dollar at U.S. gas stations
  • 5 points per dollar at U.S. supermarkets
  • 3 points per dollar for all other eligible purchases

Hilton HHonors Surpass Card

  • 12 points per dollar at Hilton Worldwide properties
  • 6 points per dollar at U.S. restaurants
  • 6 points per dollar at U.S. gas stations
  • 6 points per dollar at U.S. supermarkets
  • 3 points per dollar for all other eligible purchases

They’re making these changes because they think the bulk of their customers will prefer them.

They aren’t making the changes as a reaction to taking a charge on their financials for increased redemption costs of Membership Rewards, remember they’ve bumped up the number of points earned at Hilton HHonors prroperties. They used to offer 9 points per dollar with the Surpass card, Citi introduced the Hilton Reserve card with 10 points per dollar and they didn’t just match they beat the Citi offering by 20% in that category of spend.

And they aren’t making it as a result of too many drugstore purchases (such as prepaid cards or gift cards), they could have just capped the drugstore bonus. Remember they still bonus supermarket spend.

So really not a conspiracy, though some will prefer the new bundle of points earning and others will find it less rewarding for their particular spending habits. But these are the actual changes coming down the pike, with a few months’ notice.

  1. mommypoints said,

    Good job getting the real scoop!

  2. Food Wine and Miles said,

    Hmmmm… 5 Hilton vs. 2 UR for dining is a pretty close call now (though I’d probably still give UR the edge, wouldn’t you agree?)

  3. Gary said,

    Definitely go with Sapphire Preferred (and it’s 2.14…)

  4. Antonio said,

    UR points are more flexible than HH points, so yeah, Sapphire wins.

  5. Euro said,

    Well, 7 is better than 6 for the no-fee card- but sad to see that gas station and supermarket spending will go down from 6 to 5. And I would have still preferred 5 for drugstore spending or telecom rather than 5 for restaurant spending due to the Sapphire Preferred. Overall a thumbs down in my book. May need to frequent different supermarkets for gift cards now…

  6. VG said,

    Telecommunications is one big area where I do not have an alternative card with attractive spend bonus.

  7. Gary said,

    @VG Ink Bold/Plus for 5 Ultimate Rewards points per dollar

  8. LIH Prem said,

    bummer that drugstore category is going away. Does anybody give a bonus on drugstore purchases after this change?

    -David

  9. SWB said,

    Thanks for clearing all this up — appreciate the sleuthing.

  10. Food Wine and Miles said,

    @Gary – You’re right, 2.14
    @Antonio, Gary – I agree, but it’s not a landslide IMO (and closer than most other options I can think of)

  11. Ms M said,

    I agree with Euro – though I have opted not to get into the gift card game. I really wonder if the purchasing of gift cards is somehow contributing to the changes we’re seeing.

  12. Pedro said,

    Thanks Gary for the update!

  13. blake said,

    Is Ink really the only other option for telecom spend bonus? I’m staying away from Ink due to Chase’s requirement that you certify on the application that the card will only be used for business expenses. Would hate to lose all the bonus points on $200+ of monthly telecom spend…

  14. Kevin said,

    Can we get a before / after comparison of the hilton surpass cards? Also, still giving diamond status after $40K spend?

  15. Chuck Berry said,

    OK, I have NO hotel cards – YET. I have never played in this channel (long time airline card player), I’m a completed virgin for hotel cards. I do have plenty of Chase cards, several Amex, and a couple Citi cards. Only applicable cards I have now are SPG and Amex. I’m ready to dive in on the big players in hotel-specific programs. Goal would be quick collection of points/certs for at least a couple nights in high end overseas properties (next trip includes Sydney, where I know hotels are pricey).

    Looking for general advice on what are the best (for me) hotel cards going now? Can I get more than one of their cards at the same time (eg Hilton HHonors Card and Hilton HHonors Surpass Card)? I’m probably looking for 1) Hilton 2) Hyatt 3) I dunno – suggestions?

    FWIW I do plan to shop at drug stores fairly heavily in the next few months…

    Gary – what, no affiliate links? ;)

    Thanks for ferreting out the details on this.

  16. Frequent Churner said,

    Yep, club carlson card is looking even better now.

  17. FrequentMiler said,

    Thanks for getting the (probably) final word on this. I can see how those changes would be good for someone who uses only one card, but for most of us this is a disappointment.

  18. Hilton Amex to drop drug stores & telecom bonus categories - The Frequent Miler said,

    […] UPDATE: Gary reports that changes are coming, but not until May. Plus he has details about other changes: some good, some bad.  Read the details here.  […]

  19. Dan said,

    Putting aside the reload issue, I cannot see how this is an improvement for most cardholders. First, you are losing a point for groceries and gas which are big spend areas for most people. Now it’s true you get 5x on restaurants which can be a significant expense for many as well but there are plenty of options for cards that give a bonus on restaurant spend. Plus you used to get 3x anyways and you just gave 2x up total from gas and groceries. I would not be surprised that reduction alone cancels out the extra restaurant bonus. That leaves you getting 1x extra Hilton point in exchange for giving up 3x extra points in drugstore and telecom purchases. Plus how many cards give a bonus for drugstores and telecom? What a deal! Thanks a lot AMEX!! Sorry cannot see how this change can be considered good for most people.

  20. Apu said,

    Anyone knows if Target is a grocery store or a supermarket? Or if I may ask – does Target spends earn 5/6X under the new rules?

  21. Jason said,

    In a vacuum these changes are probably neutral (or marginally beneficial) for someone putting most of their spend on the card.

    For point junkies there are better cards in every category that was enhanced and not that many that can replace the Drugstore/Communication bonus.

  22. goals^n^dreams said,

    Love it! What stores is under supermarket categories?

  23. Dan said,

    Just to drive home my point. Let’s say you drive your car 15000 miles/year average 20MPG and pay $3.50/gallon on average. That’s $2625 in gas a year so thats 2625 points you just loss going from 6x to 5x. Now lets say you spend $600/mo in groceries. With the way grocery prices are and depending on size of family that could be way undershooting it. That is $7200/year or another 7200 points down the tubes for a total of 9825 points lost. You get 2x points now for resturants so if I would have to spend 9825/2/12 or $409.375/month in restaurant spend just to break even. And we have not even touched the loss of bonus for drugstore and telecom spend.

  24. goals^n^dreams said,

    Thank you for your help. I am really in love at your blog.

  25. Jessica said,

    I spend a lot more at restaurants than drug stores so sounds good to me. I have the surpass so no changes to gas stations or grocery stores.

    Target should be classified as a discount store. It’s a better deal to get the Target CC and get 5% instantly off every purchase.

  26. Kyle said,

    The only way this is big deal is if you are doing the VR thing at CVS, and using a Hilton CC. If this goes away the difference is marginal, IMHO.

  27. Andrew said,

    I’ve had the free card for several years, I had no idea that drugstores were a bonus category? I thought it was just gas stations and supermarkets (in addition to Hilton Hotels, of course)?

  28. Dan said,

    I was only looking at the change to the no-fee version mainly because that is what I have but after reading Jessica’s post and looking more closely at the Surpass it seems to me that AMEX is intentionally downgrading the no-fee card in an attempt to push more people to the Surpass. What was the advantage of it point wise before other than better Hilton bonus spend?

  29. abigail said,

    Frankly, beyond domestic Hilton stays, there is very little reason to carry this card going forward unless you need the spend for status- the points are just too devalued. Even at the 6x at drug stores, it was a tough call vs SPG. The decision to spend to status and AXON awards (Maldives) as my aspirational stay. beyond that, 2,000 SPG gets me a >$100 weekend night at some new SPG hotels I stay at anyway when i travel. 5x= 10,000 Hilton will get me nothing.

    That said, I imagine my 6x drugstore spend isn’t exactly benefiting them, so not unexpected. and the games remains one of what’s working NOW

  30. rajuabju said,

    I dont put more than about $15k annual on my Hilton Surpass.

    So now I have to think its no longer worth the annual fee vs the free version…

  31. Avi said,

    Oh well…Points earned from my bulk pharmacy purchases on behalf of my business just got cut in half. I was really enjoying earning my 102K points per month.

  32. Dave said,

    I mostly used the telecom bonus. I am planning to get Ink eventually. Sounds like it will be by May.

    Downgrade, but could have been worse. Good reporting.

  33. Karl Mitchell said,

    Disappointing. Telecom and drugstores were the main reason I got the card (the free one). Dining I use Chase SP, gas and groceries I used Amex PRG. Looks like the card will lay idle.

  34. Tim2 said,

    Like the change, would rather earn points on restaurants. Liked the telcom but will just have to get an ink product

  35. Rob said,

    This change means I will only use my Hilton card for Hilton stays — I’ll stop using it for anything else.

  36. Jeremy said,

    This works out badly for me. I may use Hilton when there is no freedom bonus on grocery stores, but I really count on the drug store and telecom bonuses. AmEX will lose lots of CVS VR charges from me.

  37. Alan said,

    Wow those earning rates are unbelievable!!

    By comparison in the UK we get:
    2 HHonors per $1.60 (£1) on non-Hilton spend
    3 HHonors per $1.60 (£1) on Hilton spend

    :-(

  38. TheYGuy said,

    Looks like I’m gonna have to switch my spend. Now I am putting all of my gas, grocery, and drugstore spend on this card.
    Drug store is going on my 2% priceline card. I’ll probably have to get a penfed rewards card for the gas/grocery.

    I will switch my restaurant spend, but it is low.

    Unfortunately I picked up the no annual fee carlson card, with these changes, I am thinking that is a great card for all spend.

  39. TravelBloggerBuzz said,

    Thanks for getting the scoop! I am disappointed too.

    I now wonder whether Amex will mess with the spending requirements for Gold and Diamond in the cards…I have a feeling they may go up!

    Looks like time to step it up for a few more months and then bye bye drugstores!

  40. jim006 said,

    Cannot believe so many continue to blather on about X card for this, Y card for that, Z card for the other. FrequentMiler said it all in his “One Card To Rule Them All” blog. Only once you’ve maxed out $100K spend do any of the other cards matter. The next best card is the Amex Blue that offers 6% cb at grocery stores (if you have last year’s version with unlimited spend).

    With Blue Ink in your wallet, you can rack up serious miles and cash back…

  41. First Quarter Spending Bonus Reminders - Mommy Points said,

    […] my United Club card since it gives me 1.5 United miles per dollar which isn’t too shabby.  Word on the street is the bonus categories are changing on the Amex Hilton cards, so that may impact some folk’s spending patterns in the near future as […]

  42. Changes to Hilton Amex earning structure - FlyerTalk Forums said,

    […] update here two days after this report came out? http://boardingarea.com/viewfr…at-we-thought/ Effective with the first billing period starting on or after May 1, the free card changes to: […]

  43. MyTravels said,

    Restaurants was previously a bonus category that was removed. Restaurants are probably being reinstated as (1) they saw a drop in usage after dropping the restaurant bonus category and (b) Chase Marriott, Ritz, Priority Club and Hyatt cards bonus dining (including quick-serve)

  44. The sky is falling! Or, is it? - The Frequent Miler said,

    […] has the full scoop here: “There Are Changes Coming to the Hilton American Express Cards — But They Aren’t What We Thought.”  The biggest change is that Amex is replacing the Drug Store & Telecom bonus […]

  45. Wal-Mart, Amex take on banks with Bluebird debit card - Page 428 - FlyerTalk Forums said,

    […] Originally Posted by amolkold Agreed. I only do beans if I am 1) Meeting minimum spend for initial bonus, targeted spend bonus, or calendar year spend bonus 2) If I'm making a 2+% profit given the card fee. This means 6x Hilton (valued at 3cpp for me – 0.8cpp per the fee) is a good use, but not most other cards. Just note that 6x for Amex HHonors at drug stores is going away May 1. (Probably irrelevant because I doubt VRs at drug stores will be a thing by then, but just something to be aware of.) http://boardingarea.com/viewfr…at-we-thought/ […]

  46. robertw said,

    MAny supermarkets carry a wide variety of gift cards. Many here in South fla let you charge. Therefore with some good management you can get a great variety and use on many different areas of your spending. Of course no flexibility like Vanilla cards.

  47. Meeting Minimum Spend: Vanilla Reloads Still Available at Some CVS’s - View from the Wing said,

    […] Sadly 6 points per dollar at drugstores on the Hilton American Express is going away in May. […]

  48. cjstl said,

    If you have a US Bank Cash+ card and have billpay set as one of your 5% categories like I do, you should be able to earn 6.25% back on most telecom purchases (I get even more because I also have a Platinum Checking account). I have been successful at getting most of my monthly bills set up for the 5%.

  49. Powerpasser said,

    IMO 1 *wood point = 4.5 to 5 HHonors, so once I reach 125K for an AXON, the Hilton Amex won’t be worth my time anymore, so I shall simplify my life by cancelling it. My favorite cards are Sapphire & Carlson + most merchants prefer Visa over Amex, but I hate to end a 13-year relationship with Amex, so I’ll probably keep my Starwood Amex.

  50. Antonio said,

    Hilton website now lists fewer points in all categories except Hilton spend than what was listed in this post.

  51. Ongoing offers for Hilton Amex credit cards - FlyerTalk Forums said,

    […] What happened to the drugstore category? Upcoming changes to Hilton Amex cards are explained here: http://boardingarea.com/viewfr…at-we-thought/ 3. So when can we churn this card? This is how I interpret the T&C and it has been confirmed […]

  52. The Most Rewarding Credit Cards Depending On What You Spend Money On - View from the Wing said,

    […] credit cards for different types or categories of spending. Since that time American Express has announced changes to their bonus categories for the Hilton cards, and has also capped the cash back earning in bonus categories for Blue Cash (making its 6% rebate […]

  53. Vanilla Gas - FlyerTalk Forums said,

    […] Originally Posted by pantanal where did you see that.. I am still getting 6 points for my vanilla purchase I believe it ends in May 2013 for existing customers. http://boardingarea.com/viewfr…at-we-thought/ […]

  54. FritzCooper said,

    How does existing cardholder get Surpass bonus?
    I have the no annual fee HHonors Amex card now.
    Terms on Surpass signup bonus say not available to existing HHonors cardholders. So I need to cancel the no annual fee card to get Surpass bonus? How long after cancelling should I apply? Thoughts? Thanks

  55. Add A Comment

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