Automatic privileges from credit cards

Some credit cards offer automatic privileges, which can take a number of forms.  These are discounts or upgrades that come from simply using a credit card.

Many credit cards have a set of users who earn an above average income and also are paid to do a lot of travelling and stay in hotels.  This is a very valuable set of users for many companies to be able to advertise to.  Some airlines and hotel companies also tend to have a large stock of unused seats and hotel rooms, particularly during off peak periods.  This means that it is often a very cheap way to market to credit card users by offering some of this surplus either at a discount or as an upgrade from a less expensive option.  In this way surplus stock is sold off and both brand awareness and brand loyalty is built up among a desirable group of potential customers.

Cards that tend to offer these are either cards that are tied to hotel chains or airline companies, such as Emirates and Qantas.  There are other cards that are offered by banks that also offer these rewards.  They can range from no frills credit cards such as the ones offered by Aussie where these are sold as an alternative to reward points to more expensive reward cards which market themselves to employees who pay for expenses and where the cards have a good set of reward points.

There are a number of ways that these automatic privileges can come around.  One of the most popular are upgrades.  If a traveller books a standard flight on an airline and then pays with the card with the automatic privileges program then they can be upgraded from standard to business class.  This can be worth several hundred dollars on an international flight.  If an airline has over booked standard class and under booked business class (something that is done quite frequently) then they will need to find travellers to upgrade any way.  Even if they have not over booked standard class this is a minimal cost to an airline.

Another way in which the automatic privileges can show is through automatic discounts.  These are discounts whenever the credit card in question is used to purchase certain goods such as cinema tickets or restaurant meals.  These are again offered in return for building brand loyalty and brand awareness.