Marketing: Hey you, your travel credit card annual fee is worth it because of travel perks.

You: But I can’t travel, so what am I supposed to do then?

Last week, Chase became the first premium travel credit card issuer to proactively offer relief on annual fees, with a $100 credit on Sapphire Reserve Credit Card annual fees. People aren’t traveling, so why should they pay for travel rewards they can’t use?

American Express, Goldman Sachs and Capital One announced flexibility on payments and other card features, but no other has of yet plunged into proactive reductions on annual fees. The most primed candidates for such reductions would be annual fees over $100 which are justified by very travel-centric benefits.

American Express also extended the spending period for unlocking welcome bonuses by an additional three months, to help customers achieve their rewards.

Whenever uncertainty looms, a ‘watch and learn’ approach is fair, at least at first. Knee jerk reactions rarely yield the best results, and if you don’t fully know the extent of what you’re dealing with, great mismanagement or underestimation can only exacerbate an issue.

Basically, premium travel cards could look insulting if an offer is too weak, by failing to understand the severity or longevity of customer concerns.

It’s absolutely fair for credit card issuers not to have yet acted in any broad scale on annual fees, but after Chase made the first move, the clock is ticking. Disproportionate gesture can leave cardholders underwhelmed, but inaction is equally dangerous. It’s better to do ‘something’ and re-up, than to have people eyeing up which cards to slash, based on their steep fees.

When you can’t use perks, it’s very, very easy to start slashing.

contactless credit cardPeople who hold premium credit cards are typically those most willing and able to bring on a recovery, when travel is safely advisable again. They’re also typically a travel brands best customer, because their card membership is only justified by travel.

Someone holding a premium airline or hotel credit card with key perks tied to elite status, or travel perks like lounge access are brand enthusiasts. They go out of their way to stay loyal, and their credit card is proof of their relationship both emotional and physical with that airline, credit card company or hotel.

Short-term pain for credit card companies, like annual fee relief now, will mean loyal customers at the ready when the restart button is engaged. Anything less could mean cardholders downgrading to lower annual fee cards anyway, sometimes meaning an entire loss of any annual fee collection, or worse, the customer jumping into a new relationship with a credit card, airline or hotel competitor.

Extending benefit validity simply isn’t good enough.

There’s just not enough emotional connection or gesture to being able to use something later, maybe. These are people who gain value from actually using their benefits, and for the most part only justify their cards by doing so frequently. Until there’s an opportunity for them to tangibly do so, only cash in hand, or cash returned moves the needle.

Paying With Credit Card On LaptopYou don’t want to give any loyalist a reason to leave right now.

When a bank says “we’ve put money back onto your account with a fee credit”, it’s inherently exciting, because there’s a lower balance when you log-on than you expected to see. That’s more visual and tangible than “you can use this thing later than expected”. Regardless how large or small the gesture, it feels like a two way street, not just money going out.

If a $550 a year premium travel card is 50% justified by lounge access, that’s a good indicator of just how deep a cut should be, though we may not see that level any time soon. Either way, it’s time for a new type of introductory offer from credit card companies, and that’s all about what they’re willing to do to keep you around…

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