They Say the Era of 100,000 Mile Bonuses is Over, But This is Ridiculous

In the depths of the financial crisis, airlines got liquidity from their co-brand issuing banks by taking loans — in the hundreds of millions of dollars — backed by frequent flyer miles. These amounted to pre-purchase of miles at a deep discount. (Along with the drop in fuel prices, American Airlines only recently finished prepaying the billion dollars they got from Citibank.)

It wasn’t surprising, with low miles costs, to see big signup offers. The first 100,000 mile offer I recall was for the British Airways Visa in 2009. In 2010 we saw a 100,000 mile offer for the basic co-brand AAdvantage card. In 2011 Capital One ‘trumped’ with a 110,000 point offer.

Renegotiated deals have gotten much more expensive for banks. United, Southwest, Delta, and American have all gotten new credit card agreements since that era (and American is negotiating again).

Meanwhile banks have gotten savvier. Expensive signup bonuses are tough to recoup except from the very best customers a bank acquires. So when we see a 100,000 point offer it’s often at least intended to be targeted.

Much more common now are 50,000 point offers — and sometimes those are even the ‘surge’ level, with the major airlines often settling back in at 25,000 or 30,000 points for their ‘standard’ offer.

Naturally, there are offers which are much worse.

In 2014, Japan Airlines offered referral bonuses if you’d get your friends to sign up for their MasterCard. They sent you a towel.

The JAL MasterCard from First Bankcard also offered a signup bonus of a stuffed animal. At least it was really cute.

Nonetheless, I think that this signup bonus is… ridiculous.


(HT: Tocqueville)

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. To be fair it just says “apply”, not that you have actually to be approved, although I assume there is some language on a form that you have to sign that says you are providing, to the best of your knowledge, an accurate name/address/SSN/etc. (Just thinking out loud)

    And the Jal plane is ridiculously cute!

    Also FWIW, there is a better offer available at Walmart. When I was buying money orders a few months ago the clerk said I could get $25!!!!

  2. I seem to get regularly targeted by the full spectrum of card issuers: a 250,000 Membership Rewards sign up bonus for the Amex Business Platinum on one hand, and a Secured Gold Visa with a $500 limit (secured by my $500 deposit plus a $149 annual fee) on the other!

  3. Unfortunately people bite on that stuff. Or a free sleeve of golf balls at a tournament.

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