Mastering the Art of the Retention Bonus

As a former retention associate with Citi, I thought it would be useful to provide some insight into the process of getting the most out of you retention offers. After all, you are in this game to get as many miles and points as possible so why not see that through all the way to the end on each card? You spent the time making sure you were applying for the best offers you could, maximizing your spending to get the most points for your dollars, and now you are coming due for an annual fee or you have reached the end of a particular cards usefulness. But there may still be some value left to be had.

So what exactly is a retention bonus? A retention bonus is exactly what it sounds like, a bonus or special offer to retain your business. When you call to close your credit card, you may end up being transferred to a “specialist” or whatever other random title or name the CSR decides to give the retention associate. This associate will then proceed to try to get you to keep your card via one of many methods, mainly making you some type of special offer.

I think this is one of the areas in the credit card world that has remained a murky and leaves a lot of people with question. Questions like, what criteria determines if I get an offer? Does the reason for cancelling affect the offer I receive? Why do other people get offers and not me or just better offers than me? Or maybe you just aren’t sure what to tell them because the reason you are cancelling is simply because you got the card for the sign up bonus and now a year later you need to close some cards so you can continue to get more!

While I can’t speak to other companies specifically such as Chase or Amex, I believe my time in the retention area at Citi gives me some valuable insight that might help some of you out. While the finer details will no doubt be different from one company to the next, I believe the general process is pretty similar between all of the major companies. I will not be able to address all questions in this post, but by all means leave a comment or email me if you have any other questions and I will do my best to answer them.

What Criteria Determines the Offers Available to Me?

This is unfortunately not a question that can be answered with a black and white A-Z list. There is a system generated profitability model that automatically determines the offers available to you based on your profitability or potential profitability to the credit card company. Many things are factored into the calculation such as how long you have had the card, the total length of history with the credit card company, income, total previous spending, payment history, credit card type etc.

Does the Reason For Closing Have Anything to Do With Getting an Offer?

Your stated reason for closing the account does not affect what offers the rep has available. However, the reps are trained to try to address your main concern and give you the least offer that addresses your concern. If you tell them the annual fee is your main concern, then they are more than likely going to offer some form of statement credit (if available) as their first offer as they are trying to address your issue. However, the offer they make is rarely the only offer available. But it may be the only one that involves a statement credit.

The key here is to make sure your reason addresses what you would need to keep the account. So if you want them to credit you for the annual fee, tell them you are considering closing because you don’t want to pay the annual fee. If it would take bonus miles/points to keep you, tell them you are closing the account because you just don’t feel like you were earning enough miles/points. Or that you are earning more points with a different card. Then they are more likely to start throwing offers like: Earn x amount of points if you spend x, or earn 2x, 3x, 4x, etc points per dollar for x amount of time.. You get the idea.

If I Decline the First Offer Will They Make a Second Offer?

So the 1st offer isn’t very good but do I have any choice?  The reps get paid a higher commission for retaining you with a lower offer and have to achieve a high retention rate as well (meaning the number of accounts they saved vs. closed) and therefore if they have another offer and your are polite and don’t seem extremely adamant that you just want it closed, they will more than likely make another offer.

How Do I Get Them to Make a Better Offer?

If the rep makes an offer and you want better, do not be afraid to ask. They are held to a high quality standard (at least in retention at Citi we were) and they have to give you what you ask for if it is available. Keep the question fairly general. Don’t ask, “can you give me 5,000 bonus miles?” But rather if miles are what you want, then ask “what is the most miles you can offer me to keep my business?” And they have to tell you the offer. Or if the statement credit is the biggest thing your after, then ask “can you give me a larger statement credit”.

A few extra pointers:

Remember that these representatives deal with a lot of ticked off customers during a day and if you are pleasant and respectful you will receive better results. But if you are pushy or you give the impression that you aren’t open to options, they might just close your account and not offer you anything. I have to admit that when we would get someone being a jerk about the annual fee on an AA card and acting like they were God’s gift to mankind, I was more likely to take the ding on my stats and close the account without an offer just to spite the jerk. A good attitude goes a long way.

If they can’t give you an offer you are willing to accept be ready to close the account or  you can always tell them you will keep the account open to consider it and call back in a month. But keep the annual fee in mind.

Don’t think you are going to get a great offer if you just opened the account 3 months ago. Keep the account for close to a year before you call.

I will make this a permanent page in the future and periodically update it with additional questions/answers in the future.

So what other questions do you have? What is the best offer you ever received?

Don’t forget to follow me on Facebook and Twitter!

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25 Responses to Mastering the Art of the Retention Bonus

  1. Pingback: Mastering the Art of the Retention Bonus | Hack.Travel

  2. TWA44 says:

    Thanks for a clear and helpful post. One thing I wish I had realized sooner was that closing an account as a way of expressing anger at a company is a double-edged sword. I know your focus here is retention bonuses but thought a mention of reasons to keep a card you don’t plan to use might help other newbies reading here as well.

    For a trip we took last summer, I used points on a credit card, but the rules were so onerous that I vowed to close the account on my return. (We had to book through the card’s travel agent, who was extremely unhelpful and could not see the flights I could see; I was kept on hold endlessly; etc.) But we had a very long history with this card and it was costing us nothing to keep it. I would have been smarter to have just popped it in a drawer. Indeed, doing that might have prompted the company to come back with a retention bonus, although given the difficulties in redeeming the points, I would have thought long and hard before biting.

    When I got into this game, I was surprised to see that our lengthy credit history did not produce a longer number of years in the credit card average. Then I remembered that I had closed a card we had kept for 15 or 20 years. Oops.

    • The Points Traveler says:

      Very good point! I guess we have to simply live and learn!

      It is wise to keep around your older cards to keep your average length of account history high. This is even more benefitial when they are no fee cards that do not cost you to keep them!

  3. Pingback: Sample of a helpful blog post - Page 2 - FlyerTalk Forums

  4. Thanks for a very helpful article!

    What’s the most miles you can give me for continuing to read your blog?

    • The Points Traveler says:

      🙂 Unfortunately my retention department is closed right now, so will have to try back later! Thanks for reading!!

  5. it’s great to get the perspective of an industry insider. Thank you for being so frank.

  6. Hunter says:

    Thank you. But I need to point out that closing an account will not affect your AAOA, at least within ten years.

    • The Points Traveler says:

      Good catch. That is true since your AAoA is calculated from the day the account starts reporting thru today regardless of whether it is open or closed. But if closed it will fall off after 10 years (sometimes sooner). So keeping the oldest cards open keeps that age continually increasing.

  7. Josh says:

    Definitely saved this article. Great to see some insight from an industry insider.

  8. William says:

    Excellent insight thanks.

  9. Edward says:

    Love the insight from an insider’s perspective. Does this also mean that people who call in who definitely want to cancel automatically ding your retention score? That kinda sucks, right?

    • The Points Traveler says:

      Yeah, but that is where the sales skills come into play. I could overcome just about any objection. The only one I could never overcome was “Dave Ramsey says I have to cancel all my credit cards” Those guys are impossible to get to budge!

  10. Pingback: Chase retention bonus or fee waiver reports [All cards] - Page 88 - FlyerTalk Forums

  11. Pingback: Citi retention offer reports [All cards] - Page 136 - FlyerTalk Forums

  12. jp says:

    Thanks for the great tips. I’m curious about the records kept on the calls: Does it show on a screen that we have called retention more than once? What about when an App-o-rama has been done, and so multiple cards are renewing on the same day?

    How many notes are made on each call?
    Is the retention dept a Mon-Friday deal, or over the weekends, too?

    • Jeremy says:

      There are notes added every time you call. However, the notes are made on whatever acct is accessed specifically. There is not a master notes screen for each person as a whole, just account specific (unless they get new systems). Not much is added as far as notations go. System notes mark the call but not the subject/content of the call. Any other notes are manual and we rarely made them unless it was important for the next time you called. Open 7 days a week.

  13. cali says:

    I must say these reps are difficult. I called 5 times! The 1st rep tried to get me to upgrade to the platinum Delta card with NO sign-up bonus, only a companion pass. The 2nd rep only offered me 300 miles as a retention bonus for my Delta card. What a joke! The 3rd rep tried to give me a speech about the card and it got to a point that I asked her if there were any mileage incentive that she could offer me. Nothing! The 4th rep told me that they do not have any offers for me. Finally on the 5th call, the rep offered me 3,000 delta skymiles. I accepted this because at this point I about to give up. After the phone I call, I seriously began to wonder if they put a note in my account or something. I called back a 6th card and mentioned that the 3,000 miles is not close to mitigating the cost of the $95 annual fee and closed the account.

  14. Pingback: The 11 Month Itch: Getting a Citibank Annual Fee Waiver | Milenomics

  15. Pingback: When to cancel a card and when to pay an annual fee | getting my points high

  16. Don says:

    Great article Jeremy.

  17. Pingback: Citi retention offer reports [All cards] - Page 41 - FlyerTalk Forums

  18. Pingback: Citi Retention Strategy Guide & How to Get the Best Offers!

  19. JA Moore says:

    Following your advice, I contacted the retention dept regarding my upcoming annual fee. The rep stated I would receive a $95 statement credit for keeping the card and that I have 30 days to make a spend of $95. I don’t understand whether I need to make the spend in the next 30 days or if it’s normally 30 days after the annual fee appears on a statement or…..????

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