Orbitz Launches New Credit Card – Is It Worth It?
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Last fall, Orbitz launched a loyalty program called Orbitz Rewards to compete with incumbents like Hotels.com‘s Welcome Rewards and Expedia Rewards, and it has about 2 million members to date, so it was only a matter of time before the site launched its own co-branded credit card.
Available starting today, Orbitz has partnered with Alliance Data Retail Services (ADS) to offer the Orbitz Rewards Visa. The gist of the card’s value is that it offers an additional return of 5% on your Orbitz Rewards earning. So in terms of the kinds of bookings you make, here’s what you earn back on your spending if using the card:
- 10% on Orbitz Rewards hotel bookings using Orbitz.com apps for iPhone, iPad and Android (5 percent Visa reward plus 5 percent mobile booking reward) – you normally earn 5% on app bookings and 3% on computer bookings
- 8% on Orbitz Rewards hotel bookings using Orbitz.com desktop (5 percent Visa reward plus 3 percent desktop booking reward)
- 7% on air bookings using Orbitz.com apps for iPhone, iPad and Android (5 percent Visa reward plus 2 percent mobile booking reward) – without the card you earn up to 1% per $1 up to $5,000 per year ($50 Orbucks)
- 6% on air and package bookings using Orbitz.com desktop (5 percent Visa reward plus 1 percent desktop booking reward)
- 2% on all other purchases (in the form of Orbucks)
You also earn a $50 Orbucks statement credit when you spend $200 in 90 days and automatic Orbitz Rewards Star Status (their low-level elite status that you normally earn by booking four hotel room nights). Benefits include a special VIP line to handle travel needs, concierge service, help booking events and entertainment while traveling, and upgrades in some cases. There is no annual fee on the card, and no foreign transaction fees.
Orbucks earned through the credit card do not expire as long as travelers use the card at least once annually, and are available when your statement closes. Like the general Orbitz Rewards program, cardholders earn Orbucks, which are equal to $1 USD each and can be redeemed for hotel bookings made through Orbitz but not flights. You can use them to pay for all or part of your booking if you have more Orbucks than your stay costs. Orbucks are deducted from your Orbitz Rewards balance immediately. You will earn Orbucks on the portion of your booking not paid for with Orbucks.
First off, I would have liked to see a decent sign-up bonus, since most top travel credit cards offer bonuses in the $400-$600 range. The $50 Orbucks credit is pretty weak, but for a no annual fee card, I think this card can provide a lot of value as long as you redeem for hotels since Orbucks cannot be redeemed for flights. If they changed that, this card’s value would jump exponentially. The potential 10% return on your hotel spending is pretty good and in line with Hotels.com‘s programs where for every 10 nights you get 1 night free at the average cost of those 10 paid nights and the rebate can be stacked on top of Orbitz’ new loyalty program, which could give some major value back if you book a lot of hotels. I’m not usually a fan of booking via mobile apps, but I could become quite familiar for that extra bonus.
Where the Orbitz card pulls ahead of Hotels.com is that you can earn points on flight bookings as well as package bookings, plus 2% on all other purchases, so that gives you a lot more earning potential, especially considering you can book flights through Orbitz, pay with your Orbitz card and still earn airline miles and elite-qualifying miles on flights while earning Orbucks to redeem for hotel bookings.
However, if you’re loyal to a particular hotel brand, you would probably still want to book directly through them since they generally do not count stays booked through OTA’s like Orbitz towards earning points or elite credit. However, as hotel chains continue to devalue their points, it may make sense to think about loyalty to an OTA like Orbitz and crunching the numbers to see if foregoing traditional hotel points and instead going through Orbitz might make sense.
In terms of straight-up travel booking, I would probably also still use a card like the Sapphire Preferred, which earns 2.14x points per $1 on all travel purchases including flight and hotels (as well as things like train tickets and taxis) since the transferable points it earns can be used with 10 transfer partners including 5 airlines (like Southwest, British Airways and United), 4 hotels (including Hyatt and Marriott) and Amtrak. The other card I’d consider a great alternative is the Barclaycard Arrival since you earn 2x miles per $1 on all purchases and can redeem those at 1 cent per mile on travel purchases (not just hotels and airlines) and get a 10% mileage refund on travel redemptions for a 2.2% return on spending without having to book through a certain app or site.
Still, if you’re a frequent Orbitz booker who wants fixed-value rewards to redeem specifically for hotel bookings, this is a decent card for you, and the 2% return on all purchases is on par with other cards like the Arrival, but you can redeem Arrival miles for much, much more than you can with the Orbitz Card.
It’s also a good option if you already have several Amex, Barclaycard and Chase cards, since this is issued by ADS, giving you another option to leverage your credit score for new rewards cards. Overall, the value proposition is decent as long as you’re a big-time Orbitz hotel booker. If not, you’re probably better off with more traditional credit cards with higher sign-up bonuses and more redemption options.
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