Citi is latest to issue a heavy metal luxury card
A few years ago the battle among elite travel credit cards centered on topping rivals’ gigantic signup bonuses, and now it’s all about who’s got the heaviest physical card, along with a few other perks.
Citigroup is trying to gain an edge in the hotly contested category by introducing these competitive elements to its revamped Citi Prestige card.
This week Citi rolls out a new version of its Prestige credit card that weighs more than twice as much as the older plastic card, according to Citi. This brings Citi’s Prestige card—which carries a $450 annual fee—on par with rivals as metal becomes the new status marker among top-tier cards from issuers including American Express Co., JPMorgan Chase & Co. and Capital One Financial Corp.
In another change, Citi is introducing a streamlined approach to the way Citi Prestige customers redeem one of its key benefits, which could improve the card’s usefulness — or it could backfire, analysts say.
When Citi Prestige customers book a hotel stay of at least four nights, they will instantly get the fourth night free instead of waiting for the savings to be applied to their card account as a statement credit. Citi—not the hotels—manages the free hotel room perk on the back end, a Citi spokesperson said.
Citi’s move aims to simplify the process of getting a free night at any hotel, but there could be a couple of risks to making one of the card’s central benefits more invisible, said Brian Riley, director of credit advisory services at Mercator Advisory Group.
“Giving away the fourth night free as a matter of booking the reservation is simpler, but it also means the consumer is more likely to quickly forget the benefit value,” Riley said.
The new approach could also make it harder for a customer to document travel savings.
“In today’s times, any foul-up in getting a free night’s stay with a customer who likes to tweet could be a messy situation, while statement credits are crisp and clear,” Riley said.
Citi sees the upgrade as a convenience to customers who rely increasingly on mobile apps and appreciate immediacy in travel and rewards, according to the spokesperson.
Citi is also enriching the bonus it gives to new customers.
Under the revamped program, new customers who spend $7,500 during the first three months get 75,000 ThankYou points that are worth more than $900 when redeemed through Citi for air travel, a spokesperson said. Citi Prestige customers also get an annual cash award of $250 to apply toward air travel.
Customers will ultimately decide whether the deal is enough to switch, and it’s unlikely the metal materials will make a big difference, Riley said.
“In a commoditized business like credit cards, issuers are looking to the card's appearance itself as a distinguishing factor, and it’s interesting that many premium cards are now issued in metal, but ultimately customers respond to the whole card’s features and value,” he said.