Diners Club rewards points have been redeemed for:
- A honeymoon in Bora Bora
- A Tiffany engagement ring
- Bar mitzvahs in Israel
- An eight-day cooking school in Rome
- A Napa Valley mystery train dinner for two
- Safaris in Africa
American Express rewards have been used for:
- An RV tour of New Zealand
- A three-day polo clinic with a renowned instructor in Palm Springs, Calif.
- Rental of a private island for a dinner party
Rewards points have also paid for liposuction, hypnosis, Lasik eye surgery, dental work and a Cavalier King Charles spaniel puppy. But experience rewards don't have to be frivolous or self-indulgent.
"We see a ton of redemptions for college tuition. Just in the last month, somebody redeemed over 1 million points for tuition at the Illinois Institute of Art," says Miller.
And some cardholders still use their points for more down-to-earth, but still costly, purposes such as home improvement.
"During the recession of the past couple of years, we really started seeing a trend toward redeeming points for more everyday needs," says Miller. "We see blueprints for a new home, somebody had their house painted. Someone just redeemed a million points for a new Sharp projector for their business."
Calculating reward costs
So just how much do you have to charge to rack up experience rewards? It depends.The dollars-to-points conversion is inexact, at both accrual and redemption. You may earn one point for every $1 you charge, but special promotions and partnerships can accelerate that rate significantly, just as they can when you redeem your points.
For instance, although tickets to a recent American Express-sponsored celebrity chef event in New York City cost $325 or 79,000 points (roughly $41 per 10,000 points), merchandise in the company catalog averages closer to $100 per 10,000 points.
But as long as you have a balance in the rewards bank, no experience is too big or too small to pay for with points.
"Using points does not have to be a huge adventure. It can be as simple as going down to the Four Seasons for a wine tasting on a Sunday afternoon. There is no minimum and no maximum," says Miller.
Mainstream cards entering the arena
Experience rewards are beginning to catch on with a handful of major card issuers, as well.Disney recently partnered with BankOne Visa and Universal Studios teamed up with J.P. Morgan Chase MasterCard to offer credit cards with points redeemable for passes or discounted admissions to the associated theme parks. Citibank has taken it one step further, offering select experiences such as dolphin swims and snowmobile rides to major point holders.
Whether the trend becomes the norm may well depend on how effective experience rewards prove to be at luring and keeping customers in the already saturated credit card market. But for some cardholders who have amassed a stockpile of points, the reward now may literally be the chance of a lifetime.
"People look at experiences as a really good return for their points because they wouldn't get to have that experience otherwise," says American Express's Fish. "Getting access as our card members did recently to a reception with Tiger Woods and Ernie Els, two of the top golfers in the world, at the World Golf Championships in Atlanta is a great experience. How many people actually get that opportunity?"
Jay MacDonald is a contributing editor based in Mississippi.