Buying Membership Rewards at Saks Fifth Avenue

While you might not think of credit card points as something you “buy,” there is certainly a value to them, and if you can find a good deal, you should go for it!  The trouble is sometimes in finding the deal.

In this case, it all began with an AmEx Offer.

AmEx Offers are promotional deals found on your American Express account, and come in a few different forms.  Most commonly, it’s some kind of “Spend X, Receive Y,” where Y is either a statement credit or a number of rewards points.  Slightly less common, there are also deals that allow the user to earn additional points on purchases.  For example, when I go purchase items online from BestBuy.com and I use my American Express Premier Rewards Gold card, I’ll earn an extra Membership Rewards point on each dollar I spend, thanks to an AmEx Offer that’s good through the end of the year.

With a recent AmEx Offer, I found myself looking up the nearest Saks Fifth Avenue location.

Again, on my Premier Rewards Gold card, I had an offer to spend $450 at Saks, and receive 7,000 Membership Rewards.  Now, I don’t typically shop at a place like Saks, but the three zeros caught my eye.  For 7,000 Membership Rewards, I thought I’d see what I could do.  I looked at the terms of the Offer, no exclusions for gift cards.  Good.

That’s the first step for me.  As long as I can use it on a gift card, I can find lots of useful deals, because I’ll often resell those gift cards.  To be clear, if you regularly shop at Saks, just add the offer to your card, and you’re done!  Some easy extra points for your regular shopping.  Just don’t get caught in the trap!  They want you to spend more of your hard earned money, and then justify it after the fact by looking at your healthy Membership Rewards balance.  I try not to mix AmEx Offers for personal use with those for travel hacking use for exactly that reason.

After some initial research on GiftCardWiki, I targeted a resale value of 85%.  GiftCardWiki is a really useful site, even if you’re not selling cards.  It’s essentially an aggregate of all the discounted gift cards on the market, so you can use it to find savings on your everyday spend.  Shop at Saks a lot?  Check out GCW and maybe pick up a secondhand gift card for 5-10% off.  If you’re not into designer brands, you can easily check the site to find a gift card to TJ Maxx, Old Navy, you name it.

Disclaimer – please research the secondhand gift card markets on your own before making the decision to buy. Buying a used gift card has inherent risks, and I hate seeing people get burned by fraud.

You can see a few interesting details in the screen above, taken from GiftCardWiki.  The most important for me, is the long-term decline in inventory, with steady (though low) sales volume.  That means less competition and steady demand.  Simple supply and demand dictates that Saks cards should sell at decent prices.  You can also see there’s been a recent spike in inventory, by looking at the “Market Share” bar chart.  Today, there’s many more cards on the market than there were yesterday, in the past 7 days, and in the past 30 days.  That’s ok though, it just means I may have to hang onto my cards for a few extra days, due to the recent market influx.  I’m willing to bet the sudden jump has to do with the AmEx Offer…I’m not the only one looking for deals!  If you want to get into the nuances of pricing gift cards, this is a really useful site, and I encourage you to poke around.

Sometimes, I find it easier to purchase cards in store than online, you walk right out with the gift card in your hand!

I have the dollar value from the AmEx Offer ($450), and I have my going rate (~85%), which should let me recapture $382.5 of the total purchase price.  Now I need to squeeze every dollar out of this deal!  Usually I’ll check cashback portals, but I wanted to purchase this particular deal in store, as there was one near my office anyway.  Luckily, Ebates has some in store options, and Saks was listed (they do change every so often).  I linked my card, and was ready to purchase!

When I walked into Saks, I was totally lost.  Talk about being out of your element…I’m more of a Marshall’s guy.

I made my way to a cashier, and purchased 3 gift cards, $150 each.  With a final purchase price of $450, I knew I’d be triggering the offer, and on my way to 7,000 Membership Rewards!  Sure enough, I received the “You just used your AmEx Offer” email a split second after inserting my card, and a few minutes later I received an email from Ebates confirming 4% cashback on the purchase.

Next up, I’d be listing the cards for sale.  Since this is more of a introductory post to AmEx Offers and gift card reselling, I won’t get into all the details.  What’s important is that the cards all sold at 88%, and it took me 7 days to sell them.  A sell percentage of 88% means I sold each card for $132, or a total sale of $396.  So how much did I spend on those Membership Rewards?

Gift Card Cost – (Gift Card Revenue + Ebates) = Cost of Membership Rewards

$450 – ($396 – $18) = $36

Cost of Membership Rewards / Membership Rewards = Cost per Point

$36 / 7,000 MR = 0.51 cpp

Great!  So, I essentially paid 36 dollars (and sure, about half an hour of my time) to purchase 7,000 Membership Rewards.  With general consensus ruling that Membership Rewards are worth between 1.2-1.9 cpp, I just purchased mine for more than half off.  What a great sale!

As I’m not a big spender, I find myself taking advantage of many of these types of offers.  Credit card points and airline miles have given me a way into the travel world that I wanted to experience for so long, and I’ll keep finding ways to maximize my return!  With low organic spend, it’s fun to find new ways to hit those large numbers, and keep the miles rolling in.

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