The $195 annual fee recently posted on my Barclays AA Aviator Silver Mastercard, so we went through our usual “Keep or Cancel” analysis to decide whether to keep, cancel or product change the card.
Each time an annual fee posts on one of our cards, we go through a full analysis of whether to keep the card, cancel it, or product change (although in this case, there were no product change options). In addition, we also make a call to the card issuer to see if there are any retention offers available, unless there’s a good reason not to make that call. We always like to share on Middle Age Miles our thinking and strategy with respect to these “Keep or Cancel?” decisions and our data points on retention calls.
We decided to keep my Barclays AA Aviator Silver card despite some huge recent devaluations of benefits, because of one specific feature that should save us more than we’ll pay for the annual fee, plus our desire to retain the option for me to earn EQMs and EQDs toward elite status on AA through spend on the card if needed.
Details and Analysis
The Barclays AA Aviator Silver card is unusual in that you can’t apply for it directly. Instead, you’ll need to first get an Aviator Red card. Then, you will probably be able to upgrade your Red card to the Aviator Silver card after about 90 days. You may receive an invitation from Barclays to upgrade, which could appear in your online account as soon as 60-90 days after approval. Or, after 90 days, you may be able to call in to Barclays and request to upgrade to the Silver card. If you upgrade during your first year of card membership, you won’t have to pay any additional fee during that first year, which is a nice treat.
I was approved for the Barclays AA Aviator Red card in January 2017 and converted to Silver in June 2017. Thus, this was the card’s second anniversary. In both 2017 and 2018, I spent enough on the card to earn AA Elite Qualifying Miles (EQMs) and Elite Qualifying Dollars (EQDs) that helped propel me to Executive Platinum status. Thus, the card has been incredibly valuable to me for the past 2 years and has generated benefits far outpacing the annual fees we’ve paid.
Last year, our spend on this card was in the range of $50-60,000. With this level of spend, I received a total of 10,000 EQMs (5,000 at $20k spend and another 5,000 at $40k spend) and 6,000 EQDs (3,000 at $25k spend and another 3000 at $50k spend). By spending more than $30k during my 2018-19 cardholder year, I also earned a 2-person AA Companion Certificate. However, I’ll only get the Companion Certificate if I keep the card open and pay this year’s $195 annual fee.
Unfortunately, the card’s benefits have been seriously devalued recently, seriously diminishing the card’s value proposition:
- As of 2019, the ability to earn up to 6,000 EQDs was eliminated, and the spend requirement to earn 3,000 EQDs was raised. Now, you must spend $50k in a calendar year to earn 3,000 EQDs.
- As of May 1, 2019, this card will no longer allow the cardholder to receive a 10% mileage rebate when redeeming AAdvantage miles, up to a cap of 10k AA miles per calendar year. (The same thing happened to all AA co-branded cards, so as of 5/1 the 10% rebate feature will no longer be available to anyone.)
Both of these changes hurt us, but the change to EQD earning was a real killer.
Now, the card’s remaining primary benefits are:
- Bonus categories of 3x AA miles on purchases at AA; 2x for hotel and car rental purchases; and 1x everywhere else
- Earn up to 10,000 AA EQMs per calendar year – 5,000 EQMs when you spend $20k and another 5,000 EQMs when you spend $40k
- Earn $3,000 AA Elite Qualifying Dollars (EQDs) when you spend $50,000 in a calendar year
- Companion Certificate for two guests at $99 + taxes/fees (all-in, about $135), if you spend $20,000 in your cardholder year
- This is received after you pay the annual fee for your next cardholder year
- The spend requirement drops from $30k to $20k as of 5/1/19
- First checked bag free for cardholder and up to 8 companions when traveling domestically on AA + preferred “Group 5” boarding for cardholder and up to 8 companions on the same reservation
- Beginning 5/1/19, up to $50 statement credit per cardholder year for in-flight Wi-Fi purchases on AA flights
- Beginning 5/1/19, up to $25 daily statement credit for in-flight food & beverage purchases on AA flights
- Until 5/1/19, you can receive a 25% discount on all AA in-flight food & beverage purchases
- $100 Global Entry credit once every 5 years
- Access to AA Reduced Mileage awards
- Beginning 5/1/19, access to the Flight Cents plan (this is worthless, so we won’t spend any time on it)
- No foreign transaction fees
- Chip + PIN functionality
- A variety of travel and purchase protection features if you pay with the card
None of the spend categories are best-in-class, so there’s really no reason to put ongoing spend on this card – unless you need the EQMs and/or EQDs to qualify for a higher elite status level on AA.
But if you need the EQMs and/or EQDs to reach Executive Platinum status, the ability to earn these through spend on the card can be an extremely valuable benefit.
Deciding Whether to Keep or Cancel
Given the lack of best-in-class spend categories on this card, our “Keep or Cancel” decision came down to whether the card’s benefits were worth more than the annual fee.
As an aside, there would be 2 product-change options for this card – downgrade to either the Aviator Red card or a no-annual-fee Barclays AA co-branded card. The Red card held no useful benefits to us at all, so it was easy to eliminate it from consideration with its $95 annual fee. The no-fee card might have been an option if we hadn’t wanted to keep the card. If we were seriously considering the no-fee card, we’d have 2 important questions that we’d want to explore further – (1) Would holding the no-fee card impact our ability to potentially churn the card if we applied for another AA Aviator Red card later?; and (2) Would we be able to re-upgrade to the Silver card any time we wanted, for example, if we saw that we would need the EQD and/or EQM earning from a Silver card in order to re-qualify for AA Executive Platinum status (or other status level)?
For us, the Companion Certificate alone justified keeping the card. By virtue of having spend more than $30k on the card during my 2018-19 cardholder year, we can receive the 2-person Companion Certificate by keeping the account open and paying the annual fee. We have a clear, planned use for the Certificate later this year where the Certificate can save us about $500 in airfare. That’s enough to at least make it a reasonable choice to keep the card.[This sounds a bit better than it actually is, because we might be able to generate Citi ThankYou Points in a way that would reduce this price differential.]
The other thing that’s valuable to me is having the option to earn additional EQMs and EQDs through spend on this card. Looking ahead through the end of 2019, our best-guess estimates of my AA EQMs and EQDs for this year would leave me just short of the 100k EQM threshold for Executive Platinum, and a few thousand dollars short of the newly-increased 15k EQD threshold. It’s possible that I could need additional EQMs, and it’s likely that I’ll need more EQDs from credit card spend.
But at this point, it’s very helpful to me to keep multiple options open. Thus, in addition to the value we’ll get from my Companion Certificate, there’s also value to us in the optionality to potentially use the card to earn EQMs and EQDs.
For those reasons, we decided to pay the $195 annual fee and keep the card.
However, for most people, we’d say it’s hard to find the value proposition to justify the annual fee. In our eyes, it’s truly not justified unless you’re going to need to earn EQMs and EQDs and/or you’re confident you can get significant value out of a Companion Certificate that you’ve already earned.
Did I Get a Retention Offer?
A little back story may be in order here. Last year, on my retention calls on this card, Barclays steadfastly held to the position that it did not give retention offers on this Aviator Silver card – even though I had spent more than $50k on the card during my previous cardholder year.
So, I went into this year’s retention calls with low expectations, even with almost $60k in spend during my cardholder year. But I made 2 retention calls anyway, and I’m glad I did.
I actually received 2 bonuses as a result of my retention calls. I’m not sure either one was technically a retention offer, but I wouldn’t have received them if I hadn’t called.
On my first call, I initially didn’t receive any retention offer. I explained, though, that the value of the card had been killed for me as a result of the change in the EQD earning structure and the upcoming elimination of the 10% AA mileage rebate. The part about the rebate must have triggered something in the agent’s script. She said that she could credit my account with 2,500 AA miles (worth $31.25 at our baseline value of 1.25 cents per AA mile) to help compensate for the loss of the 10% rebate. I told her that I still needed to think more about whether to keep the card or cancel it, and in response she said that she’d go ahead and add the 2,500 AA miles to my account anyway. So, it seemed like more of a “complaint by a good customer” offer than a “retention” offer. The 2,500 AA miles didn’t post to my account immediately, but they posted a few days thereafter when my next statement cut.
On my second call, the gist was largely the same – the agent mostly tried to persuade me by reminding me of the benefits of the card. But at some point, she said that she did have an offer that she could add to my account. If I spent $1,000 per month for the next 3 months, I would receive a $100 statement credit. That’s not bad – an extra 3.3% return on my spend if I can spend close to the $1,000 threshold each month. Again, this seemed like more of a “normal” Barclays offer that they often send by email around cardmembers’ anniversary dates, as opposed to a true retention offer. But in any event, I accepted, and I’ve completed my first month of $1,000 spend on the card. (And, this spend will help modestly if I decide that I need to hit the thresholds to earn EQMs and/or EQDs later this year.)
As you’ve read, we decided to keep my Barclays AA Aviator Silver card and pay the $195 annual fee, for some very specific reasons that may not apply to many people. If you don’t fall into one of these narrow categories where you can get outsized value, you’re probably better off closing the card (or perhaps product-changing to a no-fee card) and potentially attempting to churn the card by re-applying for another Barclays AA Aviator Red card later.
In addition, although I’m not sure I received any true “retention” offers, my calls certainly provided value that really helped justify paying the annual fee and keeping this card for another year.
Do you have anything to add to our analysis, or any other data points on retention offers for the Barclays AA Aviator Business card? Please share with us and other Middle Age Miles readers in the Comments!
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