We have just completed a study that reveals the number of reward points required to redeem Apple products from all of the major credit card issuers. The purpose of the study was to see if it made economic sense to actually use reward points to get Apple products and also to see which reward program required the least points.

The credit card issuers involved in the study included Chase, Citibank, Bank of America, Capital One, and American Express. The investigated reward programs were the Ultimate Rewards from Chase, Thank You from Citi, World Points from Bank of America, Capital One’s reward program (no name), and Membership Rewards from American Express.For the online shopping portals, we looked at Ultimate Rewards, Citi Thank You, Bank of America Add It Up, Capital One’s Perk Central and Discover’s Shop Discover Online.

Methodology – To conduct the study, we picked a few Apple products that were widely available in these reward programs. While we found that most had almost a full range of Apple’s products, we understood that choosing just a handful would be sufficient and not affect the results at all.

The products that we chose included the Apple iPod Touch 8GB version, the iPad 2 16GB with Wi-Fi and 3G with either AT&T or Version, MacBook Air 13 Inch and the MacBook Pro 15 inch version. Both the iPod Touch and iPad products led to easy comparisons because unlike the MacBook Pro, the internal components were very much standard and not subject to consumer customization. The MacBook Pro was a little trickier because different reward programs had slightly different specifications. Hence, we had to go beyond just looking at the number of points needed to redeem for the MacBook Air and Pro. Instead, we also had to look at the specs and then compare the price it would cost at an Apple store versus the points required from a reward program.

Explanation of the Value of Reward Points – For most reward programs, the average value of one hundred points is one dollar. Let us assume for the moment that for the most part, you will earn one point when you charge one dollar to your reward card. That means when you get one dollar of value from one hundred points, you essentially get a 1% return or rebate equivalent.

To ascertain if it is worth using reward points to redeem for Apple products, we first determined the price of the product. To do so, we simply took the standard price from Apple’s online store. Once we have the price of the product, we know that to achieve a one percent reward return from reward points, the number of points required would be the price of the product multiplied by one hundred. For example, if a product cost $1000, then to achieve a 1% return, 100,000 reward points are needed. If more than 100,000 points are needed (in this hypothetical example), we would conclude that it is not worth using your points to redeem for the products because most other basic rewards like gift cards and cash back will yield one percent.

Results of Study

iPod Touch 8GB – The iPod Touch 8GB cost $199 on the Apple store with free shipping. That means that the benchmark to watch out for in terms of points required is 19,900.

The Chase Ultimate Rewards program requires 19,400 points, but you need to pick up the product from a Best Buy store. The Membership Rewards requires 37,100 points, which is almost two times the number of points required by the Chase Ultimate Rewards, though shipping of the product is provided. Citi’s Thank You requires 23,700 points and requires store pickup. But the version on their reward program is the 4th generation and not the 5th generation. Capital One requires an amazing 54,500 points and Bank of America requires 22,000 points.

For the iPod Touch 8GB, the Chase Ultimate Rewards is the only program that that makes it worthwhile to exchange your points for it (based on the price of $199).

iPad 2 – with Wi-Fi and 3G – For the iPad 2, we used the 16GB model with Wi-Fi and 3G. The price on Apple’s store is $629. Therefore, we will be looking at reward programs that require about 62,900 points or less. Chase Ultimate Rewards requires 64,200 points. Membership Rewards requires 118,400 points. Capital One requires 163,250 points though it comes with casing and cover. Citi’s Thank You did not have this item. Bank of America requires 75,300 points. Once again, it appears that the Ultimate Rewards from Chase provides the best value using reward points for the iPad 2.

MacBook Air 13 Inch – For the MacBook Air 13 inch, the specifications is as follows. The processor was the Intel i5 Core, 1.7GHz and 256GB Solid State Drive. The price on Apple’s store was $1,799. Chase Ultimate Rewards needed 152,800 points. Membership Rewards needed 293,500 points. World Points needed 176,200 points. Citi Thank You did not have this model. Instead, they had the Core Duo with 128GB of Solid State Drive.

MacBook Pro 15 Inch – The last time is trickier because the specifications differ with different programs. The model we chose has Intel Core i7 with 2.2GHc Processing speed, 4GB Memory, 500GB SATA Hard Drive and Intel high-definition Graphics3000 and AMD Radeon HD6750M. On Apple’s online store, a similar model cost $1799.

Chase Ultimate Reward Points required 174,200 points. Membership Rewards has a very similar model on as the first model from Chase – Intel Core i7 2.2GHz processing speed, 4GB memory, 750GB Hard drive, Intel high-definition Graphics 3000 and AMD Radeon HD6750M with 1GB GDDR5. So it has a slightly more memory in the hard drive and AMD graphics. But the number of points required is 409,700 points.

Citi Thank You had a Intel Core i7 2.2GHz, and almost similar specs to Chase and Membership Rewards. The number of points required is 210,200 points.

Capital One requires 409,500 points. There were no specs on their website. Bank of America’s World Points does not have MacBook Pro in their reward program when we checked.

Observations

From this study, we can make the following observations.

1. If you would like to use reward points to redeem for Apple products, the Chase Ultimate Rewards program is the only program among the major credit card issuers that makes it worthwhile to do so. By using the Ultimate Reward points for Apple products, you are getting about one percent return or rebate equivalent.

2. The Ultimate Rewards program requires the least number of points for Apple product redemptions. Close behind is Bank of America’s World Points program and Citi Thank You.

3. Membership Rewards from American Express and Capital One require the most number of points.

4. All reward programs, with the exception of Capital One, listed detailed specification of the products in their catalog.

Conclusion

For the most part, using reward points in exchange for Apple Products in a credit card program yields less than 1% rebate or return on your reward points. The exception to this rule is the Ultimate Rewards program from Chase where you do get 1% and slightly more. Citi’s Thank You Rewards and Bank of America’s World Points require slightly more points than Chase and yields just slightly less than 1% in returns. One should avoid using Membership Reward points or reward points from Capital One for Apple products.