With Marriott Buying Starwood, Does the Starwood American Express Still Make Sense?

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John W. asks, “With Starwood and Marriott merging does it still make sense to get a Starwood credit card?”


Westin Stonebriar

I Carry Both the Personal and Business Cards

When I first got the Starwood card 15 years ago I actually received no signup bonus at all for it. I’ve had the card for a dozen years and still carry it in my wallet. I now have both the personal and the business card. I had the business card when it was first introduced in 2006. While you’re limited to a bonus only once for personal cards, if you’ve had the business card in the past (over a year ago) you may be eligible again.

I love both cards. I am a Starwood Platinum and they each give me 2 stays and 5 nights towards my elite status. The Starwood Preferred Guest co-branded card has been one of the very best for a long time. I’ve been using this card as a consistent go-to for over a decade, it was the one I recommended most back in 2002 when I started this blog. In fact, I recommend it in my very first archived post from May 2002.


Westin Siray Bay Resort, Phuket

Starwood points remain the most valuable currency to this day — whether for redeeming on hotel stays or transferring to airline miles since they have the largest array of frequent flyer program partners.

Four new benefits were added last year.

  1. No Foreign Transaction Fees

    This has been a long time coming. Premium travel credit cards shouldn’t have foreign transaction fees. Customers travel abroad, put the card away, and don’t take it back out when they return home. It’s in the bank’s interest not to charge these for customers who are regular international travels, and the portfolio of hotel and airline co-brand credit card customers overall meets this criteria. I can finally use my Starwood American Express cards at Starwood hotels, even outside the U.S.

  2. Complimentary, Unlimited Boingo Wi-Fi

    This is a benefit that American Express added to their Platinum cards a year ago. It’s free unlimited unlimited access to Boingo’s wireless hot spots around the world, something they’d charge at least $60 per month for.

  3. Complimentary Premium In-Room Internet Access

    Starwood no longer charges SPG members for internet access, and as a result they give ‘premium’ (faster) internet to Gold and Platinum members. This upgraded internet will also be extended to their co-brand American Express card holders.

  4. Access to Sheraton Club Lounges for Starwood Preferred Guest Business card holders.

The Value Proposition of the Starwood Cards

The Starwood Amex remains my go-to for spend that isn’t bonused elsewhere, because the bonus for transferring points to miles (in 20,000 mile increments) means that I’m effectively earning 1.25 miles per dollar on all of my spend. So it’s my card to give myself a category bonus when there isn’t one otherwise.

Starwood pioneered no blackout dates or capacity controls on award nights, if there’s a standard room available at a hotel you can have it on points. Most hotel programs have since more or less matched this.


W Seoul Walkerhill

Starwood also pioneered premium room awards, and still offers a better value on those than many competitors.

Cash and points awards are still a good way to stretch the value of points (and are now available for premium rooms as well).

I like the points best for transfers to airline miles. Transfers don’t happen instantly, but they’re great for topping off a variety of accounts — they’re good for transferring almost everywhere except United (where the transfer ratio isn’t favorable). They partner even with relatively ‘obscure’ programs for US members like Lufthansa’s Miles & More (access to Lufthansa first class awards more than two weeks in advance), Singapore Airlines (Singapore first class awards), and Japan Airlines (the best program to use most of the time for Emirates first class awards). And of course all with the aforementioned transfer bonus.

$30,000 spend on the card in a year earns Gold status in the Starwood Preferred Guest program. But since having the card gets you most of the benefits of Gold status anyway, minus check-in amenity and points bonus for in-hotel spend, the usefulness of the card towards status comes for folks shooting for Starwood Platinum.

Since Marriott is Buying Starwood, Should You Still Get The Card?

The best deals in travel never last. I’ve written many times that anything that’s several standard deviations better than the median will tend to revert.. but that you should enjoy things that are better while they are.

It is possible that the programs merge at the beginning of 2017. But there’s a real chance that doesn’t happen until 2018. The merger of the companies hasn’t closed yet and won’t for months. And combining programs is a big data project, likely to take 18 months.

The funny thing about the merger, as much as I don’t like it, folks with Marriott Rewards points will get nicer hotels to use their points at and Marriott is actually more rewarding than Starwood in terms of return on paid stays.

Meanwhile, there are really two sets of people who lose out in the merger:

  • Folks with Starwood elite status. Marriott’s benefits aren’t going to be as strong.

  • Folks with big Starwood points balances, depending on the ratio that they get converted to Marriott Rewards at. If they get converted at 1 Starpoint -> 3 Marriott points that’s great but if I were to guess the conversion won’t be generous perhaps 1 -> 2. That’s why it may be a good idea to err on the side of using Starpoints before programs get combined. Plus Starwood has better airline miles transfer partners at great transfer rates.

We also don’t know what’s going to happen to Starwood American Express cards. Assuming the programs get combined, will the card go away or will American Express continue to be able to service legacy cardholders? In other words — similar to what happens with Barclaycard and American AAdvantage, will folks who get the card before the programs merge be able to keep it but there’ll be no way to sign up afterward? I keep my legacy Barclaycard-issued American card in part because you can’t get one anymore.

My advice is get the cards you want, earn Starpoints, we’ll know the transfer rates before transfers happen so there’ll be a window in which to bail on the program if need be. At a reasonable conversion rate [even 1->2.5] there won’t be a reason to run from Starwood balances. And going forward remember that Marriott is actually more rewarding for spending at their hotels than Starwood is.

The overall message is enjoy those things that are better while they last, and if and when programs change move on at that time. Don’t avoid superior value now on the chance or even likelihood that it would be around later.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. @johnny3 I have had the card since 2001. I recommended it in my first post on this blog in May 2002. I receive credit when someone uses my link to sign up — as I disclose at the very top of the post. However I was recommending this card for over 10 years before there was any benefit to me for someone using my link.

  2. I would love to read a post where the answer is something other than “yes of course it makes sense to apply for a credit card”

  3. Since you believe Starwood elites will lose in the merger, should one concentrate stays in 2016 at other hotel chains rather than ensure qualifying or requalifying for Starwod elite status? The status matches from Hyatt and Hilton make it tempting to stay there, requalify for elite status, and steer clear of the unknowns surrounding the Marriott/Starwood merger.

  4. I still am staying with Starwood and both Amex cards for all of 2016…at least until I learn anything different once the Marriott-Starwood merger is completed. While I don’t know what will happen yet in 2017, I assume that, if I again achieve SPG Platinum status in 2016, Marriott will automatically give me Platinum status for 2017 with whatever the new Marriott Plat status looks like. I’ll continue to earn and burn my SPG points, and transfer the rest to the airlines where I most often use miles for premium awards (Lufthansa and American since those are the two not transferrable from Chase URs, Amex MRs, or Citi TYs otherwise).

    Once Marriott merges and announces the transfer ratios for SPG to MR points, whatever that may be, I will stick with Starwood. If Marriott offers 2:1, I’ll use or transfer most of my SPG points. If Marriott offers 3:1, I won’t be in such a rush to burn my SPG points.

  5. @john – if Hyatt works for you I think they have the better elite program anyway, but a smaller footprint. I’m still planning to requalify for both Starwood and Hyatt, on the guess than Starwood will last through 2017.

  6. @jettyboy or this one:
    http://viewfromthewing.boardingarea.com/2014/06/04/worst-travel-loyalty-credit-cards/

    Actually I do write more about good cards, worthwhile ones, than cards that aren’t worthwhile. What’s the benefit to anyone in focusing on inferior cards?

    However there are plenty I write about that I don’t recommend, or where I suggest the narrow purposes where they may sense.

    But I’ve long argued that the Starwood Amex is a strong earning card for purchases where you aren’t earning bonuses. And that advice doesn’t change at this point.

  7. Is there anything in his value analysis that seems wrong or off-base? Is there any logic he uses that fails to live up to scrutiny? If not, then I don’t think there’s any point in “Durrr you get referral link credit.”

  8. When I click on your link for the personal card, and read the stated terms, I see, “Welcome bonus offer not available to applicants who have had this product within the last 12 months or any other Consumer Delta SkyMiles Credit Card account within the last 90 days.”

    First, this would contradict what I had understood the AMEX policy of one bonus per lifetime, and second, I’m confused about the reference to “other” SkyMiles account, since this is not one. I do have a no-fee SkyMiles AMEX. Can you clarify the terms? Is this an error, or has something changed? I got the bonus five years ago and would love to do it again if I could cancel my Delta card, then apply for the Starwood card in 90 days.

  9. I find myself looking for my next card and considering the SPG. I almost pulled the trigger last summer when it was 30K but didn’t. For the 3K spending requirement, I’ve narrowed down to SPG personal and Citi Premier. I will be done working on my second SW card for the campion pass and looking for the next card. I understand the value in SPG points but for the spend, does it balance out against the Premier, 25K vs 50K in bonus makes me wonder?

    I already have Prestige so more TYP would be good. I have seven Chase cards as well so no more chase. I have PRG but don’t use it much accept for Amex offers and grocery spend which isn’t enough. I also have an Alaska, and both CitI and Barc AA.

    Should I go SPG, Premier or is there another car to consider?

  10. @DaveS – I also see “Welcome bonus offer not available to applicants who have or have had this product.” So I assume the other language is in error.

  11. I got the SPG card in 2004 thanks to Gary’s advice. It was almost another decade before I started following his blog. SPG has served me well, always reliable, always giving me something to work for and making the rewards easy. I never regretted. I’m not sure it came with a bonus in 2004. “Rewards” weren’t a common conversation topic back then.

    I still have SPG. It’s my primary card. Like most of you, I’m anxiously awaiting to find out how I’ll be impacted. Am not a huge Marriott fan, and I already have a Marriott cc which I keep out of sheer boredom… (the free night/yr offsets the annual fee, and they give me freebies at the front desk once in a while). The SPG card has earned me MANY flights over the years. It may well be the end of an era… but it’s been a GOOD era, thanks to advice from a stranger in 2004. Thanks Gary.

  12. On a related note, I am closing in on Lifetime Gold Status with Starwood. I haven’t been in the travel game long enough to know if there are precedents in this sort of thing. While it’s clear that nobody knows for certain what will happen, is there any reason to believe that Lifetime Status might be worth “chasing”?

  13. Not incredibly clear to me why you carry TWO of these cards. Seems redundant. If it were for the stay credits, I’d understand, except… you’re a road warrior.

  14. There is not even word on when the programs will be combined. Starwood has decent international presence so you can use the points for most trips. Worst case scenario, you can always transfer them to airline partners if you don’t like the Starwood: Marriott point ratio when time comes for the consolidation of both programs.

  15. @stvr – it’s for the stay credits [and used to be that I carried the business version for the 5% full service domestic Hyatt rebates]. Basically insurance against my stays not lining up right so that I can make Hyatt Diamond and Starwood Platinum both. I had 137 total hotel nights last year but some were outside chains, some were IHG/Hilton/Marriott, and some like Hyatt full award nights didn’t earn stay credit.

  16. @Jeff Marriott does offer Lifetime Platinum, it’s hard to walk away from Lifetime status, if you can make it this year or potentially next it could be worth chasing — Lifetime Gold from Starwood isn’t that great, but there’s a chance of course it could yield lifetime Gold in Marriott which is worthwhile.

  17. I don’t see a reason not to get the card(s) now – in practice, the once-ever bonus limitation doesn’t matter too much now if signups for the cards go away in a couple years. Also, why hoard any points? Make a plan for redemption, work towards it, and enjoy it when you get there.

  18. I acquire Starpoints primarily for transfer to airline miles. I have a large number of them. Is there any evidence that we will be warned ahead of time before they convert those point to Marriott points, giving us time to convert to them to miles?

  19. @Gary Steiger – we will know when the programs are going to combine, since they’ll no doubt have us link accounts in each program. We’ll certainly get notice when one program is going offline. Hard to imagine we don’t.

  20. Gary, it really blows me away at the tone that some readers take in there commentary. So disrespectful. You and others provide a very valuable service to your readers and I would tell some of these people stop reading the blog given the disparaging comments they are willing to make. Your come back on some of these comments were perfect and demonstrate your class to people who exhibit no class.

  21. Enjoy the blog, but have to note, when talking about something out of the ordinary, you should say several standard deviations above the mean, referring to normally distributed data. If your data is skewed and the median is your measure of central tendency, then discussing a card that is at a certain percentile would be more appropriate.

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