Editorial Policy

Should I Use My Credit Card's Shopping Portal?

Eva Norlyk Smith Ph.D.

June 11, 2013

QHi Eva,

I've heard you can earn extra cash back or extra points when you use your card at your card company's shopping portal. How does this work, and what are your tips for getting good deals? — Randy

ADear Randy,

Many card issuers offer rewards deals through retailer partnerships that allow you to earn extra cash back or help boost the value of rewards earnings. However, things can get murky, so proceed with care.

In some cases, the extra rewards come in the form of a higher percentage cash back credit when you purchase with certain vendors. In other cases, you can redeem rewards points when shopping through your card issuers' online shopping portal. However, when redeeming points or miles for products, it's often not very transparent how much you are actually paying for the item you want to purchase and if you're getting a better, similar or even lower value for your rewards points. Ask Eva

Let's look at a couple of examples. Discover has an extensive affiliate arrangement with major retailers that allows you to earn an extra 5 percent to 25 percent cash back when shopping through its shopping portal.

The way an affiliate arrangement works is this: When you click through from the Discover website to shop at the affiliate vendor's site, a tracking cookie will be attached to your browser. This is a little piece of software code that records your activities on the site and automatically notifies the card issuer for any purchases you make that qualify for the discount. Discover then passes some of the affiliate earnings on to the cardholder making the purchase.

The Discover card shopping portal has links to many major retailers, and the extra cash-back earnings range from 5 percent to 25 percent. You can, for example, earn 20 percent cash back on flower deliveries via FTD, ProFlowers or Teleflora; 10 percent extra on select purchases at the Home Depot and Gaiam; and 5 percent on select purchases at Lands' End, Lowes and numerous other stores.

The catch? To get the credit, you'll have to click through from the Discover shopping portal and use your Discover card when you making purchases. Not all items qualify, so look under “Offers” for the vendor listing in the Discover portal. If in doubt, call and ask first. Otherwise, there appears to be little downside with this particular arrangement. It's cooperative advertising at its best: The vendors get purchases, while Discover gets goodwill, brand-name building and increased consumer loyalty (and, most likely, a small percentage of each sale). And you get extra cash in your pocket.

You can also increase the value of cash-back earnings by redeeming them for gift cards with major vendors. Again, using Discover as an example, $45 in cash-back rewards can be exchanged for a $50 gift card with department stores, such as Macy's, T.J.Maxx, Marshalls and Younkers. That's a 10 percent increase in the value of rewards earnings. Some vendors offer even better value. For example, $40 in cash-back earnings can be redeemed for a $50 gift card with Lands' End, Gap and L.L.Bean, a 20 percent increase in cash-back value.

Chase Ultimate Rewards also offers extra rewards with large national vendors when you shop through the “Earn Faster” section of its online portal. The extra earnings range from 2 to 15 points extra per dollar spent (the equivalent of 2 percent to 15 percent extra in cash-back earnings).

There is one thing to watch out for, however, when using issuers' shopping portals to redeem rewards: Sometimes, if you translate the points required to purchase items into dollars, those items are sometimes priced slightly higher than they would be if you bought them directly from the store.

In the American Express online shopping portal, for example, you can redeem rewards earnings directly, but many items come at a considerable premium. For example, you will pay 21,200 points (equivalent of about $212) for an Amazon Paperwhite Kindle via the AmEx shopping portal, but $119 if you purchase it via Amazon. Prices vary, and some items are more comparably priced.

So look before you leap. Always do price comparisons before taking advantage of online shopping offers through your card issuer. There is value to be had, but it takes a little research to make sure you're really getting the value you think you are.

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