New American Express

8/8/2019 New American Express

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American Express

American Express Company (NYSE: AXP), sometimesknown as "AmEx" or "Amex", is a diversified global

financial services company headquartered in New York

City.

The company is best known for its credit card, chargecard, and traveler's cheque businesses.

Amex cards account for approximately 24% of the total

dollar volume of credit card transactions in the US, thehighest of any card issuer.

American Express as the 22nd most valuable brand in theworld, estimating the brand to be worth US$14.97

billion.


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Fortune listed Amex as one of the top 30Most Admired Companies in the World.


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American Express

Type Public (NYSE: AXP)

Industry Banking , Financial services

Founded 1850

Headquarters New York City, New York, United States

Area served Worldwide

Key people Kenneth Chenault(Chairman & CEO)

Products Financial ,Travel services, Insurance

Revenue US$26.7 Billion (FY 2009)

Net income US$2.13Billion (FY 2009)Total assets US$124 Billion (FY 2009)

Total equity US$14.4 Billion (FY 2009)

Employees 67,701(2008)


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American Express

Mission:

To be the most respected brand in the world.

Vision:

To win the hearts, minds, and wallets of our

customers by providing extraordinary customer

service.


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Values

Customer Commitment We develop relationships that make apositive difference in our customers

lives.

Quality We provide outstanding products andunsurpassed service that, together

deliver premium value to our customers.

Integrity We uphold the highest standards ofintegrity in all of our actions.

Teamwork We work together, across boundaries, tomeet the needs of our customers and to

help the company win.


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Respect for People We value our people, encourage their

development and reward their

performance.

Good Citizenship We are good citizens in thecommunities in which we live and

work.

A Will to Win We exhibit a strong will to win in the

marketplace and in every aspectof our business.

Personal Accountability We are personally accountable for

delivering on our commitments

Values


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Business model

Typical credit card business model

When a consumer makes a purchase using a credit or charge

card, a small portion of the price is paid as a fee (known as the

merchant discount), with the merchant keeping theremainder. There are typically three parties who split this fee

amongst themselves:

1. Acquiring bank: The bank which processes credit card

transactions for a merchant, including crediting the

merchant's account for the net value charged to a credit

card.


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2. Issuing bank: the bank which issues the consumer's credit

card. This is the bank a consumer is responsible for repaying

after making a credit card purchase. The issuer's share of the

merchant discount is known as the interchange fee.

3. Network: the link between acquiring banks and issuing

banks. These banks have relationships with a network, rather

than with each other, for fulfilling card purchases. For e.g.

card issued by a community bank in Peru to be used at a

shop in Sri Lanka, for instance, without requiring the banks to

have a direct relationship with each other. The two largest

networks in the world are Visa and MasterCard.


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How amex is different

American Express typically plays the role of all three parties above,keeping the entire merchant discount. In recent years Amex has begun

authorizing other banks to either acquire or issue on Amex's behalf,

primarily in countries where Amex would otherwise have little or no

presence.

Amex s "spend-centric strategy", card spending and fees areresponsible for 70% of Amex's card profit, vs. 10-40% for other issuers.

Amex also tends to make more money from annual fees than other

issuers do.

Due to its focus on affluent customers, Amex has historically hadlower levels of credit losses than other issuers. The gap has almost

disappeared for Q3'08 to Q1'09, however, as card issuers of all types

experienced heightened credit losses.


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Products

American Express is best known for its iconic Green, Gold,

and Platinum charge cards, and offers credit cards of similar

color levels in most countries.

Centurion Card,often referred to as the "black card,"catering to an even more affluent and elite customer

segment.

Express Pay, that requires a card to simply be waved in frontof a special reader and not swiped.

Plum Card, card line for small business owners.


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American Express Red , with each card memberpurchase the company contributes to good causes

through The Global Fund to Fight AIDS, Tuberculosis

and Malaria to help African women and childrensuffering from HIV/AIDS, malaria, and other diseases

American Express introduced the ZYNC charge card.White in color, this card was created for people in

their 20s and 30s. The card is currently in open beta

testing and anyone can apply for it.


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Corporate responsibility

American Express supports hundreds of non-profit organizationseach year through its foundation and corporate giving activities.

American Red Cross Disaster Relief Fundfor disaster relief, serviceto the armed forces, blood and tissue services, and health andsafety services.:

Employee-Driven Philanthropy for feeding the hungry, mentoringstudents, building homes, cleaning up the environment or makingpersonal financial contributions,

Partners in Preservation contribution for preservation of historicsites and monuments.

Travel With Your Mind : which aims to reestablish schools as thefocal part of the community.


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Merchant Grouping Definitions

Travel Expenses

Transportation Air, Rail, Bus, Taxi,

Lodging Hotel, Motel, Rentals

Restaurant Meals Prepared meals where dining is primarily onsite

Cash

ATM and Bank Cashier withdrawals

Retail Expenses

Retail Stores and On-Line Purchases

Grocery Stores / Caterers

Conference Fees and Registrations

Memberships and License Fees


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Card Types

Travel Expenses

Travel Expenses

Cash Expenses No Retail Expenses

Corporate Platinum Card Purchasing Platinum AdvantageCard

Retail Expenses

Travel Expenses

No Cash

2 Cards, but 3 profile options:

1) Corporate Card2) Purchasing Card with Travel

3) Both Cards


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Analysis Criteria which card tochoose?

OPTION 1 Purchasing Card w/Travel

Criteria :

Other* > 20% of spend

Travel > $1,200 of spend

Cash < $250 of spend

80%of spend on travel& cash

One Card (Corporate Platinum Card)

OPTION 2 Purchasing Card only (no cash)

Criteria

Other* > 20% of spend and

Retail purchasing < $1,000of spend

Travel < $500 of spend

One Card (Purchasing PlatinumAdvantage Card)


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Analysis Criteria when to choose both cards

OPTION 3

2 Cards needed: both Corporate Card AND

Purchasing Card Criteria:

Other* > 20% of spend and

Cash > $250 of spend

Two Cards corporate and purchasing in one card


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Facts about India

The number of millionaires in India people with liquid assets ofover $1 million shot up 51 per cent in 2009 to 1.27 lakh.

Last year, India had 1,26,700 people with more than $1 million, or

Rs4.6 crore, net worth, compared to 84,000 in 2008. Thats aboutone in 10,000 given Indias population of 120 crore,

An analysis by DNA shows that the wealth of the top 10 billionairesin India grew by 70.3% during the calendar year 2009 from Rs

3,55,205 crore to Rs 6,05,077 crore. Among them, Mukesh Ambaniswealth grew by 75% to Rs1,66,556 crore.

The two following him on the list Wipros Azim Premji and theVedanta Groups Anil Agrawal saw their wealth grow by 192.7%

and 247.2%, respectively.


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Fastest-growing high net worth populations* -- 2006 to 2007

CountryGrowth of high net worth

population Size of high net worth population

India 22.70% 123,000

China 20.30% 415,000

Brazil 19.10% 143,000

South Korea 18.90% 118,000

Indonesia 16.80% 23,000

Slovakia 16.00% 4,000

Singapore 15.30% 77,000

United Arab Emirates 15.30% 78,000

Czech Republic 15.10% 17,000

Russia 14.40% 136,000

Source: 2008 World Wealth Report

*High net worth: $1 million in financialassets


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SPENDING PATTERN

AMERICAN EXPRESS card holder spends morethan FIVE times from a normal card holder.


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palace on wheels


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Coffee with karan


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Motivate TEENAGERS eg reebok

puchasing 50% off


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Frequent flyers

E-check-in


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Movie premier


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Hotels & restaurants


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UNDERWATER TOURISM

New American Express

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