It is not uncommon for credit cards to create excitement among mile and point junkies like all of us. It is also not uncommon for that excitement to spread a degree or two out from us as we tell our friends and family about our new card. But, the excitement about the Chase Sapphire Reserve has hit all-new levels – and with a $450 annual fee.
This Is How Popular the Chase Sapphire Reserve Actually Is
Ran Out of Premium Cards!
You may have heard the stories from a couple of weeks ago about how Chase actually ran out of the metal cards that the Chase Sapphire Reserve was run on. They had to send out plastic cards to many with the note that they would replace it as soon as they received more. Maybe you even received one of these plastic cards (the plastic Chase Sapphire Reserve is sure to become a collector’s item!).
Annual Fee Does Not Scare Away
The strangest thing about the Chase Sapphire Reserve and how it has been received by the public is that it has a $450 annual fee – a premium card at the high dollar level. Barely anyone I speak with about this card even cares about the annual fee since you can always use 45,000 of the 100,000 Ultimate Reward points to cover the fee or you just look at it as prepaid travel as it comes with a $300 annual travel credit (check out Dustin’s post about justifying the fees like this, especially if you don’t have any travel in mind – always good to think of both sides!).
Mainstream Media Darling
And the Chase Sapphire Reserve has gone mainstream for sure. It has been written about in several major media sources and is even the cover story for the Bloomberg Businessweek! Talk about attention! The article that Bloomberg has online has some very interesting information about this card and even some about how the cards are made (who wouldn’t want a field trip at this Ohio facility!)
Filled 1 Year Quota In 2 Weeks
Yes, you read that right. Chase was hoping to hit 100,000 new cardholders in the first year of offering the Chase Sapphire Reserve. Instead, they hit the 100,000 mark in just two weeks! That tells you that the Chase Sapphire Reserve is likely even more of a hit than even Chase anticipated.
Chase also has said that they spent $0 on the marketing for this card (though they do pay affiliates – both direct and indirect affiliates). That also tells you that it hit all the right notes when it came to reaching the point loving community as the word of mouth and blog attention was fantastic – even before Chase started paying affiliate fees (I am an indirect affiliate and receive a commission if you apply and approve through cards at the links on this page – as always, thank you!).
Where Does The Chase Sapphire Reserve Go From Here?
The Travel Credit – Unfulfilled
I honestly do not see Chase changing anything about this card, at least until after March of next year. The reason is this – even though Chase was surprised at the number of applicants, they are going to want to see how the card is used and utilized. If a majority of the over 100K new customers do not use the $300 travel credit this year, that is one less year they have to pay out on the cards.
Customers Not Meeting the Minimum Spending
Another thing is that there still may be consumers that do not meet the minimum spend of $4,000 or get confused and think that the $450 annual fee counts toward that. For those that applied on week 1 and 2 of the card being available, they will need to have spent the full $4,000 before the major holiday shopping season begins – even before Thanksgiving! Many consumers hold off on spending until the time of Thanksgiving and on to prepare for the spending onslaught so they may forget about that time line.
Remember, unless you have a Private Banking relationship with Chase, if you are over 5/24 you were unlikely to receive this card. That means the first 100K cardholders are largely made up of relative newcomers to Chase and their products. With that being the case, I think new customers are likely to be very happy with dealing with Chase on a customer service level. There is nothing in the industry like calling the Chase Sapphire Preferred line and getting a human right away – the same with the Chase Sapphire Reserve.
If 30% of applicants do not take advantage of the full benefits of this card, Chase may do all right and keep it going. Remember, Chase received at least $45 million in 2 weeks for annual fees! Plus, if they did to you like they did to me and others, they set the closing date (which I would receive the points about 5 days after that if I met the spending) not until the end of October so they have a long time to have to pay out the points.