Key Marketing Tactics Of American Express Company To Maintain Their Competition & Customer Service Levels
American express was founded in 1850 and is known to be one of the companies that revolutionized the digital payments systems in both developed and developing nations. Incorporated in 1965 as a corporation of New York, the company operates in four major dimensions:
- International Card Services,
- United States Card Services,
- Global Merchant Services,
- Global Commercial Services.
Consumers have known the company for its long history of satisfying services and developing new offerings and systems as the market evolves. However, a challenge that surrounds the company is to become the most respectable brand in the world given its heritage. The case explores the tactics and strategies that have been deployed by the company in the very recent years to maintain their competition and customer service levels.
Key Marketing Tactics
Target Market
A target market is generally known as a group of people at whom the marketing efforts and strategies are directed. Companies design products to suit needs of the Target Market. American Express has highly targeted individuals who use credit/debit/prepaid cards daily and expect convenience and consistency provided by the company to them.
Marketing Mix
In terms of the promotional element for the marketing mix of American Express, the company uses traditional methods of advertising along with social media websites (Facebook, Instagram, and YouTube) to build brand recognition and awareness through leveraging on its long history of service to consumers.
Marketing Concept
Marketing Concept is a philosophy that requires companies to analyze target market needs and wants and design products accordingly to ensure that they satisfy consumers better than they satisfy competitors at an economic benefit to the company. American Express has adopted a ‘Societal Marketing’ Concept putting consumer welfare as a priority than other motives.
To provide consumers with a rich experience, American Express have also setup lounges in international airports providing American Express consumers with free facilities such as food, Wi-Fi, entertainment, concierge services. Along with this, the company has consistently been a part of events such as ‘Small Business Saturday’ encouraging consumers to purchase from small business vendors not necessarily using the American Express cards, but any other debit/credit card. Such events have added to the goodwill of the company and fueled their marketing competition implying their encouragement and support to small business vendors.
Relationship Marketing
Maintaining excellent supplier-buyer relationship has been a key focus of American Express. By providing the best services across the world at affordable price and appealing credit/debit/prepaid card packages to consumers, the company has maintained a huge consumer base that has made it successful. The company has designed several strategies to ensure that they are available always to receive consumer feedback and complaints.
Strategies such as having a Twitter account open to customer service enquiries and online live chat on the American Express website have proved successful for the company. In addition to this they have also designed smartphone apps and a secure helping the consumers (both cardholders and merchants) to check their balance, manage activity, request information change, make payments/receipts and submit enquiries. In addition to online presence, the company has also deployed representatives looking into consumer complaints. These representatives not only provide solutions to consumers with their complaints or queries but also understand their individual needs and if possible offer other American Express services to them. This practice has helped the company build loyalty and consumer satisfaction in long term.
Marketing Opportunity
A company is known to utilize a marketing opportunity when it ensures that it caters to the combination of needs and timing with the potential or target market. American Express took market opportunity and delivered consumers with credit/debit/prepaid cards services by recognizing the increasing use of electronic payments/receipts made by consumers and accepted by merchants. As technology developed, the company was tactical in identifying the need for smartphone apps and online banking services accelerating the speed of their operations and revenue generation.
Competitive Advantage
The Company has a competitive advantage over other credit/debit card companies such as Visa due to its spend-centric model targeting affluent consumers. The company maintains excellent relationship and brand recognition with its merchants as well as consumers that has made them stronger than competitors. Being the world’s largest card issuer with the largest number of transactions, the company has a strong advantage of heritage.
First Mover Advantage
American Express has been able to gain the first mover advantage, as it was one of the first companies to identify the need for more electronic payment systems in 1950’s. Their long service history has given them the first mover advantage of identifying and developing products for consumer needs.
Marketing Strategy
The Company uses Premium Positioning strategy given the fact that most consumers who use American Express services are Rich or Upper Middle Income consumers who spend frequently through debit/credit cards. It has positioned itself as a trustworthy service provider with easy to use and convenient products.
Personal Case Analysis
My research on American Express’s marketing and consumer strategy has been able to serve as an excellent example of how the company has been able to identify their target market clearly, design electronic mediums of payment for their target market and have been able to maintain their brand loyalty and recognition over years through their service strategies and efficient payment systems. A key factor in the success of the company has been the customer service that they provide to the consumers consistently. In addition to this, the convenience that they have provided to consumers by providing online systems and the largest base of merchants and businesses who accept their cards, has made the company even more preferable by consumers over the years.
Conclusion
American Express and their ability to build a vast consumer and merchants network has only been possible due to their strong marketing and long term strategies that have envisioned consumer needs and continued to serve them. Strong quality of consumer service coupled with innovative offerings in the debit/credit card market would help a long lasting company like American Express survive.