The pioneer and one of the companies revolutionising the digital payment system are aggressively capturing the developing nations. Founded in 1850 as a joint stock company it got incorporated in 1965 as New York Corporation. Currently, it is operating in four business segments namely International card services, U.S card services, Global Merchant services and Global Commercial services.
As of December 2015, the net income of American express stands at $ 5.16 billion and annual revenue is $ 32.8 billion.
Segmentation, targeting, positioning in the Marketing strategy of American Express –
The Digital products are segmented based on the customers belonging to similar geographical areas. Besides geography, psychographics and demographics are also considered. Psychographics considered include social class and VALS. Demographics includes education level, income level, marital status, occupation. Because of the high quality of products and specific targeting, a vast number of variables are considered during segmentation.
These identified segments based on different factors are then targeted through differentiated targeting strategies. First and foremost, offers and cards are made on the basis of different demographies which in turn will have various psychography. The people with high education and higher income status will have a higher self worth and values will be different. The combination of these factors are taken to target individuals.
American Express positions itself as a brand which is easy to use, more convenient, is secure and trustworthy. Moreover it uses the premium positioning strategy because the people having American express cards are considered as Rich individuals.
Marketing mix – Here is the Marketing mix of American Express.
SWOT analysis – Here is the SWOT analysis of American Express.
Vision- “Work hard every day to make American express the World’s most respected service Brand”
Tagline-“Welcome In”
Competitive advantage in the Marketing strategy of American Express-
Broad Product portfolio: American express being present in a large number of interrelated products & services helps the company in providing an array of products & services to its customers resulting in acquiring a high share of wallet of the customers.
Closed Loop Network: working hand in hand for acquiring relationships with merchants and card-issuing business which is helping the company in commanding the two important transactional aspects of the digital payments system which is not only retaining its customers but also controlling the per unit cost of it.
Premium positioning: Due to the various schemes on offer and due to the careful filtration process, American express is known as the credit card for the uber rich class. Because of the various value added services it provides, American express has a premium positioning in a segment where competition is tough.
BCG Matrix in the Marketing strategy of American Express-
Its Global card segment and merchant acquiring businesses are starred in the BCG matrix whereas its commercial services segments comprising various financial activities and businesses are a question mark due to the presence of various national & international companies in respective economies.
Distribution strategy in the Marketing strategy of American Express-
Having such a large portfolio of products & services in the digital payment industry and itself being one of the giant of financial services helps the company in seamlessly distributing its products and services with the help of the distribution partners. It distributes its various products across the globe through distribution agreements with the financial services companies.
Brand equity in the strategy of American Express-
The brand American express has been a well known brand in the digital payment industry. It has been ranked 88th in the fortune top 500 brands list valued at $160 billion (May 2015 data).
Competitive analysis in the Marketing strategy of American Express- Since the market is still in emerging stage in most of the developing economies and competitive in the developed nations, American express is facing competition from the national and international in different segments of its businesses.
To augment its offerings it co-creates customised products for a different set of customers.
Market analysis in the Marketing strategy of American Express-
With increasing per capita income of the customers, increasing literacy rate, changing digital dynamics of the emerging economies and automation in the financial industry, customer globally are getting more comfortable with digital & interrelated products and services such as cards, travel and leisure, merchants acquiring services such as POS/ M-Pos machines and many others. Due to the emerging economies, there is a strong growth prospect working in this industry.
Customer analysis in the Marketing strategy of American Express-
Customers of American express are the premium and tech savvy people who look for convenience and accessibility in the payment services. The majority of the customers of the company are in the age group of 25-40 years of the population in the retail segment while in the B2B (business to business) segment its customers consist of high networth individuals and companies across diversified industries.
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