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Just in time for the holiday credit card wars, American Express last week brought out Membership Rewards, packed with incentives for yuletide spending.

The expanded program replaces AmEx's 4-year-old Membership Miles loyalty plan, and for the first time it adds dining and merchandise to travel perks and rewards.

AmEx is making sure the program gets attention during the crucial holiday season by offering a double-points promotion from Nov. 1 through Dec. 15. It's backed by a multimillion dollar TV, radio and print campaign from Ogilvy & Mather, New York.

The catch: the double-point promotion counts only when shopping at 20 designated locations. Among them: Saks Fifth Avenue, Tower Records, Timberland, NordicTrack, FTD Direct and Waldenbooks.

AmEx also hopes to reel in a new crop of cardholders by waiving the usual $25 annual fee it charges for membership in its loyalty programs. (Existing Membership Miles enrollees also get a break on the annual fee this year, and there is never a program fee for AmEx's Rewards Plus Gold or Platinum cardholders.)

Competitors say AmEx's new loyalty program isn't so rewarding, since it costs more-and offers less-than some others, including Visa International.

"We wouldn't dream of charging customers for membership in our rewards program-it wouldn't be a reward," said Michael Sherman, Visa's VP-corporate relations. Visa introduced a free, quarterly loyalty program to its cardholders called Visa Rewards in September 1994, and it's been highly successful.

The Membership Rewards program allows users to accumulate points toward a variety of merchandise, dining and travel opportunities. Examples of rewards that can be earned with 3,000 points include a $50 gift certificate from Timberland, Caswell-Massey or Filene's Basement. For 100,000 points, cardholders can earn a $2,000 savings certificate for men's or women's clothing from Saks Fifth Avenue.

Visa Rewards also offers a hefty package of dining, travel and merchandise rewards from specific Visa merchants at a different rate. For example, this summer cardholders got $100 in reward credits for each $1,000 spent.

Visa Rewards for Travel & Adventure, which began Oct. 1, offers a similar program for discounts on purchases through Visa partners such as Northwest Airlines, Doubletree Hotels & Guest Suites, Alamo Rent A Car and Royal Caribbean Cruise Lines. A print and radio campaign through BBDO Worldwide, New York, began earlier this month.

AmEx says its program can't be compared on a dollars-to-points basis with competitors.

"We're giving cardholders excellent value with merchants who are part of the program on a long-term basis, and this is what people tell us they want," said Bruce Grieve, VP-global rewards for AmEx.

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