Disclaimer: I may receive a commission for links on this blog. Notice that I said that I may. It's technically not possible to prove a negative, so even though I don't have any commission agreements with any banks, and even though I have not to date received any commissions for any links on this blog, I suppose it's still remotely possible that I signed up as an affiliate marketer with a bank shortly before hitting my head and forgetting the entire thing. Just wanted to put that out there. Now, to the matter at hand. Why aren't more people drooling over the Virgin America Visa card? Not that the card is especially drool-worthy in the same way that an Amex Platty or a Chase Sapphy Rezzy is, but it has one important factor in its favor, which is that it earns very valuable fixed-value points in Virgin's Elevate program. You can't use Elevate points for aspirational redemptions, but you do routinely get around 2.2 cents per point when redeeming them for award flights. (Not to mention the possibility of partner redemptions, although fuel surcharges usually scare me away from trying to use my Elevate miles this way.)
One of the big things that points & miles bloggers talk about is what to do about unbonused spend; the prevailing wisdom is to use one of three cards - the SPG Amex, which kinda sorta earns 1.25 airline miles per dollar*, the Amex Everyday Preferred, which earns 1.5 points per dollar if you make 30 transactions in a month, and the Chase Freedom Unlimited, which earns 1.5 points on all purchases, though you need a premium Chase card to be able to transfer the points to frequent flyer programs. Or, you can go the cash back route and earn around 2%, depending on the exact card you're using. The point here is that a 2% return on spend is the benchmark, since that's what you can get with a no-fee cash back card; in other words, any points you earn on unbonused spend are actually being purchased for 2 cents apiece.
*I don't like the blanket statement that SPG earns 1.25 airline miles on all purchases, since that requires transferring points in increments of 20,000. If you redeem Starpoints for a hotel room or wind up with an odd number of points to transfer, you're back to just 1 point per dollar. That may be what you want, since Starpoints are hard to earn, so you have to spend on the SPG Amex somewhere in order to accrue them. I just don't think it's totally accurate to bake their transfer bonus into the value, since it doesn't always apply.
My personal strategy is to go the Amex route with the Everyday Preferred card, earning 1.5 points on all purchases. The Chase Sapphire Reserve also presents a unique opportunity, since points are worth 1.5 cents toward travel, meaning the 1.5 points earned per dollar on the Freedom Unlimited can be leveraged for 2.25 cents apiece when transferred to the Sapphire Reserve. However, I do think it should be mentioned more often that putting unbonused spend on a Virgin America Visa gets a similar return (although restricted to redemptions on Virgin, of course). This occurred to me recently, since I've been flying Virgin a lot and reconsidering my neglect of their Elevate program, in which my only miles have been accrued through flying.
There are a couple reasons off the top that these cards aren't more widely discussed: first, the sign-up bonuses are pretty weak (10,000 points for the basic card and 15,000 for the premium), and second, they're issued by Comenity bank, which is known for not having very good customer service. However, I have another theory, and it goes back to a point I've made before wherein I pointed out how ascribing absolute values to points is, not to put too fine a point on it, pointless.
See, most valuations for flexible points sit somewhere between 1.5 and 2.5 cents per point. In an aspirational redemption, the values skyrocket, but since most people wouldn't pay cash for those flights anyway, the prevailing wisdom is that those values aren't real. Instead, the true value of your points is what you would pay in cash for a flight divided by the number of sexual partners you've had, multiplied by the number of times you've rolled your eyes while reading this blog. Or not, I'm just making shit up at this point. Regarding Virgin America points, though, I think a lot of people are turned off that the points are only ever going to be worth 2.2 cents apiece. I know I am. Within the strictures of places like the churning subreddit, it's all about the hard math, maximizing your return at all times. That paradigm leaves out the emotional component of collecting points and miles, though - the hope that points will someday be worth way more than a couple cents apiece, and that they will unlock experiences you otherwise could never afford.
I'll sign up to receive emails from Virgin America in exchange for 500 free points, but I'd rather use my everyday spending to pad my balances of Chase or Amex points, even though I may end up getting less than 2.2 cents per point when I do ultimately redeem them. That way, I know that at least some of the time, I'm setting myself up for home-run redemptions flying in premium cabins over oceans rather than puttering around the US in Virgin's main cabin extra or whatever. That's the kind of thinking that keeps me away from cash back cards and fixed value points in general, even though it may not always be the most lucrative spending strategy according to some boring fucking spreadsheet that some OCD nerd put together in his parents' basement. (Editor's note: I have OCD, I make tons of spreadsheets, and while I don't live in my parents' basement, I'm still a huge nerd.)
I don't think I'm the only one who feels this way either - otherwise, more people would talk about Virgin's sweet-ass 2.2 cent return on spend the way they talk about the Citi Double Cash card or the new world-beating Sapphire Reserve/Freedom Unlimited combo. For all the hard data (haha ugh I just combined "hard pull" and "data point," which are my two least favorite expressions), this game is more emotionally driven than I think people realize.
What do you think, nonexistent blog commenters? Are you a robot whose only goal is to maximize return on spend, or do you feel human emotions... even LOVE???