American Express

Submitted to Sir M.A Butt

Student name Zafar Ullah

Subject Consumer Behavior II

Reg. No 15 11 31 40 26

Email zafarullahshar@iba-suk.edu.pk

Table of contents

Contents Contents ........................................................................................................................................................ 3

Acknowledgement ........................................................................................................................................ 4

Introduction .................................................................................................................................................. 5

Marketing objectives .................................................................................................................................... 7

Consumer Behavior study ............................................................................................................................. 8

Marketing strategies ..................................................................................................................................... 9

Recommendations ...................................................................................................................................... 10

Acknowledgement First of all I am indebted to Almighty Allah the creator of universe

and holy prophet Muhammad (SAW) the source blessing for all

human kind. I am thankful to Sir M.A Butt who enabled me to

analyze this with his best of efforts and I am also thankful to

Preston University a quality education institute

Introduction American Express Corporation launched its charge card as substitute to bank cards. Initially

the color of card was purple but later it launched in gold green and platinum the customers gave

an overwhelming response to American express card due to its novel and unique characteristics.

That is why today American express has more than 34 million customers worldwide in 130

countries opted by more than 3 million establishments.

Advertising by AmEx has went always successful and created the prestige image and

targeted suitable segment. Its adverting has major role in creating its brand image which is enough

to compete in market has edge over competitors. American express advertisement has played a

vital role clearing the concerns about qualifications of customers and has always motivated to be

part of valuable American express premium member. They don’t only motivate customers but

they also provide faster process because they have employed 800 employs to foster the process.

This proves that promised value with customers is also provided in real terms. Response from

customers tells that advertisement campaign went very successful and met the expectations of

company. Amex started its marketing campaign from early 1970s and first campaign was ‘Do You

Know me ?’ this campaign went successful because it showed the well-known fames names and

company claimed that they got recognition after being member of American express card. Here

they played the trick that they made promise that every member of American express will have

same prestige once they become member of Amex

These all tactics are successful with in United States but not much successful in foreign markets

like Japan and Europe, whereas in these markets more potential for credit cards is found. The

reason behind lagging behind is that merchants say that Amex charges 4% more than the bank

cards. The higher price charges is maintain the brand image but it also keeps away its targeted

segments so this not less than a threat for American express because day to day markets are

becoming more competitive and effective.

Other companies who already captured markets so switch the customers from these companies

to American express is not much easy .Among these countries and compared to European

countries Japan has more established and competitive market and rapid player.

The company aims to provide higher value to its customers but in order to maintain its brand

image it should also widen its services which are relevant to upper class it should also maximize

the approaches to reach customers directly and fell customers continue in their contacts. Its target

it elite class so to be best substitute of wallet cash they should minimize the gap between uses of

cash needed for elite class.

Strength

I. Some segment of people are loyal too II. Amex is maintaining good relations with

suppliers and vendors. III. Amex management is maintaining good

relations with industrial bargaining agents IV. Amex is financing strong operating system

at par with high standards

Weaknesses

I. Amex has not understood the consumer behavior in exhaustive manner

II. They are not using other powerful techniques like situational ways

III. Amex is facing cash as main competitor IV. Amex needs improvements in defining

the mission and vision and corporate goals

V. Amex needs to re visit the contracts of marketing strategies and deeply reflect on four Ps of marketing

VI. HRM department needs improvements

Opportunities

I. Economic conditions are reasonably favorable

II. Amex has to take care of legislation III. USA government has constant policies related to

plastic cards industry IV. Amex is mobilizing all the efforts to make best use of

technology V. Amex is enjoying dominant position in upper scale

segment against competitors

Threats

I. Plastic card industry is facing passing of

new legislations /laws II. Technological transformation is taking

place and plastic cards are also been affected

III. In the industrial context Amex position is weak in competition.

Marketing objectives

To hold a strong brand Image that customers loves to.

Applying the marketing techniques to capture a big market share

To have a dominant position when it comes to plastic money

More consideration on quality conscious as possible to customers as possible

Attract customers who are not price conscious

Widen the range of services to be provided

Consumer Behavior study Why consumers choose American express card has certain factors its brand image which is create

and reinforced by different effective marketing campaigns and this card is widely acceptable at

different platforms like McDonalds, Nueplex cinemas and Shoney’s family restaurants etc.

The strategies for and tactics behind the success of Amex include High price. Customers who pay

$50 for American express card perceive higher value in return whereas ordinary bank cards charge

$15-20 as subscription fee.

Higher prices paid by customers give them a thought that feel well because they are premium

member of American express. Another factor is Quality and quality is directly linked with the price.

Customers who pay more feel more qualitative and special. This card is also usable for 1400 travel

agencies around the globe so it is considered as more qualitative and superior that is why

customers don’t cry for higher price being charged. But American express provides cards to

customers from above average elite class to college students who have better savings and

earnings.

3rd factor behind the success is limited supply. This card is not for everyone but the

company wants to maintain its brand image by giving the higher value to those who want quality

not quantity.

4th factor is qualifying for this card is kept systematic. Customer’s call is received withed

7 seconds and customer can know for status in 48 hours about qualification. In order to maintain

the brand image corporation has tried to make it limited to upper scale only so that they can have

better services because American express customers are quality conscious not price conscious.

Amex continually wants improve its services that’s why they spend huge amount of money on

research and development.

Marketing strategies

Target Audience.

Elite class CEOs executives who want quality and convince along with good brand that

depict their status.

Segmentation

Psychographicaly Demographically Geographically

Brand lovers Quality conscious Who want to be differentiated Status oriented

Gender Both genders Age students-Executives Ethnicity All

Domestically in USA Internationally more than 130 countries.

Marketing Mix Strategies

Price Product Promotion Channel

High price charged than average market price

Amex is not for everyone. Less supply of cards to make it more valuable

TVCs Digital Marketing Print Ads Billboards

Website UAN Franchises Helpline

Recommendations Be more efficient and effective

Cut the rates to attract more customers

Make strategies to beat Master card and Visa Card

Provide cards to the middle class with fresh name

Explore more and untapped markets

Have long run plans

Provide gifts and other incentives program for potential customers