Would you pay $5,000 for a credit card if it got you into the hottest club in town? JC with MVM current and cool. Credit card issuers are fighting for the top spenders by providing one-of-a-kind perks like access to the “Centurion” club located in the tallest building in Midtown Manhattan and operated by American Express.
With the Chrysler building in close proximity the view is worth something. But it is the access to this club that is interesting. If you own a “Black Card” you can walk in, “Platinum card” you can try and make a reservation and the rest? Well, you must call a number that is only working 2 hours a day.
This idea for credit companies to cater to the bigger spender started 10 years ago when cafes and rest areas started going into airports. From there they went to festivals, stadiums, and other events. The Chase Lounge in Madison Square Garden gives out free food and soda with access to memorabilia stand with shorter lines and at the Olympics Chase opened a floating lounge on the Seine River.
Capital One is at the Final Four or offers truffle hunting excursions. Credit cards have been worth billions for some time now, so why the change in offers? Well all cards work pretty much the same way, opposed to debit cards you don’t use your money you use OPM from the credit company and charge interest. With a similar service companies are being forced to compete over perception of what their card can do.
You may be thinking – my card gives me airline miles or cash back. Well according to federal data there are over $33 billion in unused card rewards showing that they are just not as enticing to use as going to a cool concert. This change is focused on younger consumers who prioritize experience over possessions.
‘How can we get a consumer to pay us $700 annual fee for a card?’ For now, it seems like access to runway shows or clubs will be the way to get you to try and fall into the credit trap because you must remember the way these companies pay for all of these perks is through your interest payments. Show people you speak the language of money, avoid the credit trap on your way to claim credit card perks. Keep driving.
