Case Study – Breaking Down An Annual Fee + Retention Call

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We have been talking about Credit Card Annual Fees and why they are often worth the cost. This led to the Basic Guide to Retention Calls and how that can impact an ROI analysis of a particular Credit Card. Reviewing the Perks of a particular Credit Card will include both subjective and objective factors. For example, some people prefer certain airlines and hotels over others which may lead to keeping those co-branded credit cards open. For this case study, I’ll try my best to remain objective while breaking down an annual fee and making a retention call! 

Basic Recap of Annual Fees and Retention Phone Calls

Our Guide to Credit Card Annual Fees is a good starting point and resource to learn about the various benefits. Included in the Guide you’ll find: 

  • What are Annual Fees
  • Examples of What Annual Fees Often Include
  • How to tell if the Annual Fee is worth it
  • What to do when an Annual Fee Hits
  • How to Track Annual Fees
  • Steps to take when the Annual Fee doesn’t work for you

Our Guide to Retention Phone Calls and How they can be a HUGE difference maker in keeping a Credit Card open breaks down the phone call and more. Included in the Guide, you’ll find:

  • What is a Retention Offer?
  • Examples of Retention Offers
  • Is there Always a Retention Offer Available? 
  • 5 Steps to Making a Retention Offer Phone Call
  • A Third Option to Consider before Closing a Credit Card

Dave’s Case study 

*Disclaimer – The Annual Fee and Benefits Listed are applicable to the time period when this article was written. Benefits may have changed since then. Check with the Credit Card issuer for the most up-to-date terms and conditions. 

Credit Card: Amex Bonvoy Business Card

Annual Fee: $125

Major Perk: Annual Night Certificate (Worth 35,000 Bonvoy Points) 

Minor Perks:

Earn an additional free Night (Valued at 35,000 Bonvoy points) after spending $60,000, Complimentary Silver Elite Status, 15 Elite Night Credits, Car Rental Protection, Baggage Protection, Extended Warranty, Purchase Protection, and ability to earn Bonus Bonvoy Points via their Spending Categories. 

My Analysis –

My First thought is will closing this card have a negative impact on my credit score? The answer is no because it is a Business Credit Card and it does not show up on my personal credit report. Next, I look at whether I have the same benefits across other cards which I do. My primary Credit Card is the Chase Sapphire Reserve which carries many of the same Protections and Insurance. Third, I look at the card-specific benefits like the Complimentary Silver Elite Status and 15 Elite Nights. I actually already have the Chase Marriott Business Card which provides those same credits. Forth, the ability to earn an additional night after $60,000 is not great value for me as spending that same amount on other cards can provide better value. Last, the Annual Night Certificate. This is really my favorite perk of this card and typically provides me amazing value. 

Subjective Thoughts

This card carries some sentimental value for me as it’s a carryover from the old SPG Rewards Program. Back in the day for a much lower annual fee, I received a complimentary night and automatic hotel lounge access! For many years, it was a no-brainer as the Free Food and Drinks in the lounges & Annual Free Night easily created a positive ROI of the annual fee. 

Retention Phone Call

Since the Annual Fee was just charged to my account this is the perfect time to make a Retention Phone Call. I called the number on the back of my card and requested a customer service representative. I explained the points above, what I like and don’t like. Next, I requested a retention offer but unfortunately, there were none on that account for me. To be fair, I haven’t been using this card much and the representative indicated that was a factor. I was offered some options for product changing to other no-annual-fee cards but ultimately said I take some time to think about it. 

Basic Burning Question

Is $125 worth a Hotel Certificate worth 35,000 Bonvoy Points? I love the certificates and have found tremendous value over the years often getting 2-3 times the amount of the Annual Fee back. What’s even nicer is the ability to stack hotel night certificates together. Between Lisa and my Marriott Cards, we have 4 Certificates. These certificates can significantly cut the cost of a four-night stay at many hotels throughout the world. Think 50% off a 4-night stay if I’m getting at least double the value. 

Last Fall I used these same certificates to stay at the JW Marathon in Chicago during Marathon Weekend. The Nightly Rate was over $400! That’s over 300% ROI not including the complimentary food and beverages I received in the Executive Hotel Lounge. 

Over the Hill

My Marriot Platinium Elite Status has been extended through February 2022 due to the coronavirus pandemic. Before the outbreak, it wasn’t very likely that I would have enough stays this year to requalify for that elite status. Since my status has been extended and the tremendous value I place on Hotel Lounge Access I’ll be paying the Annual Fee for this Card. 

Basic Breakdown 

Between mine and Lisa’s Bonvoy Points Stash and Hotel Certificates, we have enough for quite a few stays. Due to this and the status extension, it makes sense to make this investment for another Certificate. In hindsight, I wonder if I had been spending more money on this card, would I have received a retention offer? Regardless, this card still makes sense for me right now and I will be paying the $125. I’m hoping to get between 3-4X the value as we did in Aruba and Japan

What do you think of my Basic Breakdown and Analysis? Would you have made a different choice if you were in my shows?

I’d love to hear in the comments below or over in our 7,800+ Member Basic Travel Facebook Group!

More Basic Reading

Editorial Disclaimer: Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.

The comments section below responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.

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