Amex recently announced a new program to incentivize customers to purchase specific items by offering them additional rewards points for buying those items. This initiative will benefit the store, Amex and consumers.

What This Means:

Imagine a particular store that sells a specific kitchen appliance in 5 different colors. The store may know enough to order different quantities¬†of each color, but this process is not an exact science and in the end, they may be left with an excess amount of one specific color. Not only do they want to sell these items to make money, but they also don’t want this product taking up space in a warehouse.

In the past, the simple solution was to offer a discount on the color that no one wanted. This incentive would benefit the customer but hurt the store who is decreasing their profit or taking a loss.

What Amex is Doing

Take the above example but instead of decreasing the price to entice a customer to buy the item, they give the shopper additional credit card points. Meaning that purchasing a red toaster instead of a black one will receive 5X the usual amount of points.

This will benefit:

  • Stores who are trying to move these items
  • Customer who receive bonus points
  • Amex who cleverly got you to use their card instead of another