...Jake Wright HW #1 6/23/14 Answer the following two questions based on The American Express Card Case: 1. American Express was able to expand its merchant mix over time despite charging merchants a higher discount rate than Visa and MasterCard. Why were merchants willing to start accepting American Express cards? Merchants were willing to start accepting American Express cards because of the patrons that were associated with those cards. The case mentions that the annual average purchase volume for an AmEx card holder ($8,360) was substantially higher than that of Visa or Mastercard, $2470 and $1960, respectively. This meant that the AmEx card holders were more likely to spend more at locations. AmEx used the higher discount rates to study the purchase habits and inclinations of card holders. These studies led to more targeted promotions, which allowed merchants who accepted AmEx to bring in more patrons who were more likely to purchase more at their locations. 2. How does American Express create and sustain a key competitive advantage over major competitors such as Visa and MasterCard? In order to create and sustain a competitive advantage over its competitors AmEx targeted a certain customer and their “lifestyle.” Instead of targeting customers that were transaction oriented, AmEx targeted customers that were “high wallet” consumers, with spending of over $30,000. These consumers were identified as travelers, liked to be different and liked special...
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...American Express Chairman/CEO Influence and Outcomes 7/30/2011 TABLE OF CONTENTS American Express Overview 3 James D. Robinson 3 Success and Failures of Robinson 3 Board Of Directors 4 Decisions Required 4 Candidates for CEO Position 5 Robinson’s Strategy 5 Decisions Of The Board 5 Problems Faced By American Express 6 Solution 7 Lessons Learnt 7 References 7 AMERICAN EXPRESS OVERVIEW American Express Company (American Express), incorporated in 1965, is a global service company The Company’s principal products and services are charge and credit payment card products and travel-related services offered to consumers and businesses around the world. American Express Company and its principal operating subsidiary, American Express Travel Related Services Company, Inc. (TRS), are bank holding companies. It is principally engaged in businesses comprising four reportable operating segments: U.S. Card Services, International Card Services, Global Commercial Services, and Global Network & Merchant Services. Its range of products and services includes charge and credit card products, expense management products and services, consumer and business travel services, stored value products, such as Travelers Cheques and other prepaid products, network services, merchant acquisition and processing, point-of-sale, servicing and settlement, and marketing and information products and services for merchants, and fee services, including market...
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...American Express is the one of the most popular financial company since it started. According to Nelson & Quick (2011), American express (AmEx) was founded in 1850 and started to provide freight forwarding and delivery services around the world and since then it is also known as global financial services company (p. 215). The company is well known for various financial services such as credit card, charge card, and travelers’ check. Maulik Vyas (2011), explained Amex cards hold around 24% of the total dollar volume of credit card transactions within the US. It is the highest of any card issuer so far. American Express has about 65,000 employees around the world to enhance the quality of service. To increase the superiority of humongous amount of employee Amex established American Express Learning center, where employee get training to increase their quality. Analysis American Express set up a learning center for the employee to improve the service of quality which is called American Express Learning Network (AELN). AELN’s customer service training program provided two types of application theories, one is learning theory and another is goal setting theory. The aim of AELN is to train their each employee to provide great customer service to existing customer and future customer. According to Harrison, AELN’s vice president (VP), primary learning for customer care employees, how they are introducing themselves toward customer and how they make sure customer that security...
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...premature or hasty judgment. 3. Finally the term acquired also its present emotional flavor of favorableness or unfavorableness that accompanies such a prior and unsupported judgment.” (Allport. 1979, p.6) Duckitt (1994) identified several interventions that may possibly reduce prejudice under “appropriate circumstances”. He explained that “these interventions have typically involved action at one of the three levels identified – that is, social structure and intergroup relations, social influence, and individual attitude and susceptibility.” To personally reduce prejudice at my work place, the first level identified by Duckitt (1994) social structure is not relevant since this refers to discrimination against minority – this is not the case at my workplace. The second level identified by Duckitt (1994) explained that “interventions aiming at changing individuals are broadly of two...
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...Citibank: Launching the Credit Card in Asia Pacific (A) Case Study, BEP 430 Marketing 20030059 Dong-ock Kim1, 20030071 Min-geuk Kim2, 20040054 Keehyung Kim3, 20040535 Yohan Jo4, 20076006 Huang Qiuling5, 20076035 Dorjsuren Bayarmaa6 Marketing Team A1 2 3 4 5 6 erst_licht99@hotmail.com1, kmg0702@hanmail.net2, keehyoung@gmail.com3, zukjimote@gmail.com4, sharlin_huangqiuling@hotmail.com5, gordok_88@yahoo.com6 Professor: Wonjoon Kim Date submitted: May 18, 2007 TO: Rana Talwar, head of Citibank’s Asia Pacific Consumer Bank, Citibank FROM: Dong-ock Kim, Min-geuk Kim, Keehyung Kim, Yohan Jo, Huang Qiuling, Dorjsuren Bayarmaa RE: Citibank: Launching the Credit Card in Asia Pacific (A) DATE: May 18, 2007 As you know, rapid growth of Asia-Pacific economy was incredible in several years. It could be a good chance for Citibank’s growth, so Citibank has started to branch banking business since 1978. Actually, performance of Asia-Pacific branches is not bad. In 1988, Citibank earned $69.7 million, but Citibank does not satisfy with its performance. Citibank’s goal is $100 million until 1990. For this goal, Citibank launched the most innovative service such as telephone banking service. And now, Citibank is planning to launch a new product credit card. Acquiring card customers means that Citibank has more opportunities to crosssell product line: Auto Loans, Ready Credit, Deposits, and Mortgage Power, Citibank’s core products. But many of Citibank headquarters have doubts...
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...Read the case study given below and answer the questions at the end of the case. Brand ambassador : employing real customers to get the word around. People love talking about things that make them happy - including their favorite products and brands. For example, if you really like an airline - they fly with flair and get you there at a reasonable price or you just love your recently acquired Sony camera - it is too good to keep the knowledge of the experience to yourself. In the old days, you would have chatted up these brands with a few friends and family members, but these days technology allows you to spread the word about products and brands experiences to thousands of other consumers. In response, Marketers are now working to harness the new found communications power of their everyday customers by turning them into influential brand ambassadors. Companies like Sony, Microsoft and McDonald's are now developing a new breed of brand ambassador programs that organize and multiply consumer to consumer interactions about their brands. These programs employ everyday consumers who are passionate about their products to act as part PR agents and part sales reps. MS-61 3 http://gyansagar.co.in Marketers select their brand ambassadors very carefully, based on customers' devotion to a brand and the size of their social circles. Once selected, the ambassadors are trained with real brand knowledge to go along with their passion for the brand. The ambassadors...
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...Running head: VALUE ALIGNMENT Value Alignment (Name) University of Phoenix Value Alignment This paper will consider an existing organization, American Express Business Travel, which compares the individual and workplace values. The paper will include an analysis of the evolution of values, how individual values drive actions and behaviors, and the alignment between stated values, plans, and actions. Finally, the paper will integrate the differences as well. Values The American Express’ company mission (2007) is “to become the most respected service brand.” In American Express’ Corporate Citizenship (2007, p. 12), it states “a key asset of our Company is the American Express brand and its promise of world-class service and personal recognition. Our reputation in the marketplace affects our business, and we constantly work to further strengthen our brand. This starts with our employees around the world and the service we provide customers across our businesses, and it is reinforced by our policies and commitment to corporate responsibilities.” Let us look at the company’s evolution. Organizational American Express’ origins begin back in 1850s as a successful express delivery business delivering packages across the frontier of the United States. The company evolved into a financial products company with the development of money orders and travelers cheques and began an international expansion...
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...Electric utility bills. When an electric utility customer uses electricity, the electric company has earned revenues. It is obviously impossible, however, for the company to read all of its customers' meters on the evening of December 31. How does the electric company know its revenue for a given year? Explain. According to historical data, the electricity usage usually tended to be fairly constant from month to month. The company can estimate the revenues for each month, by using historical data. Generally high fluctuation will not occur in electricity usage. We can easily estimate the monthly usage by the data of the same month last year. In this situation, if there is any inaccuracy we can adjust its estimation. Usually, the electricity usage is quite constant over time. Therefore, the company can estimate its revenues based on the data from the last year. If there is any inaccuracy, we can make adjustment in the following month. Retainer fee. A law firm received a “retainer” of $10,000 on July 1, 2006, from a client. In return, it agreed to furnish general legal advice upon request for one year. In addition, the client would be billed for regular legal services such as representation in litigation. There was no way of knowing how often, or when, the client would request advice, and it was quite possible that no such advice would be requested. How much of the $10,000 should be counted as revenue in 2006? Why? Only half of the “retainer” should be recognized. This...
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...4. Assess the external threats affecting American Express and the opportunities available to the corporation. Give your opinion on how the corporation should deal with the most serious threats and opportunities. One of the external threats affecting American Express is due to technology trends. For instance, prior to technology, American was the most dominated credit card company in the credit cards sector. However, Penetration of alternative payment platforms has been gaining popularity in the recent years. These alternative payment platforms include aggregators such as PayPal, wireless payment technologies, including using mobile telephone networks to carry out transactions. According American Express Company (2014), “the system has changed to system sinked to payment cards, and bank transfer models increasing penetration with other alternative payment platforms could check growth for the company.” Therefore, the portability provided by Smartphones and tablets and evolving consumer behavior with social networking, is rapidly changing the way people interact with each other and transact business all around the world. Another major threat that might affect Amex is due to political factor. For instance, according to Ireland and Hoskisson (2013), “Congress passed Dodd-Frank, which the US President Barack Obama signed into law in July 2010”. Therefore, Dodd-Frank could limit Amex’s income earned through interchange fees. As a result of these new laws, customers may be incentivized...
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...1 of the Sherman Act “every contract, combination in the form of trust or otherwise, or conspiracy, in restraints of trade or commerce among the several States, or wit foreign nations, is hereby declared to be illegal and is felony punishable by a fine and/or imprisonment”. On one hand, Visa, MasterCard, American Express and Discovery are the four major credit- and charge-card networks in the United States. This makes the credit card industry highly concentrated, meaning that a small number of firms control a large percentage of market sales. Although Visa and MasterCard are joint ventures and they bar member banks from issuing cards on rival networks, they still compete against each other. On top of that, Visa and MasterCard may argue that even though the rules that they established with member banks hurt their competitors (American Express and Discovery), it doesn’t necessarily harm competition. Amex and Discovery themselves issue cards to customers, thereby staying in the market. Also, the agreement can be considered a vertical restraint of trade. Vertical restraint is any restraint on the trade created by agreements between firms at different levels. While in case of Visa and MasterCard the banks issue the cards, clear transactions, and collect fees, Amex and Discovery themselves issue cards to customers, process transactions, and collect fees. So, firms operating at different functional levels are not in direct competition with one another. In addition, even though some...
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...Introduction: American Express 3 II. Overview of Organization: Background 3 III. Organizational Design 4 IV. Scope of Operation 5 Vision 5 Values 5 Operating principles 6 Board of directors 7 V. Current Operation State 8 VI. Desired State of American Express 10 VII. Developments 12 Risk and informational management 12 Strategic planning group 13 Human resources 13 Technology 13 VIII. Program Design and Development 14 Objectives of the program 14 Incorporate site visits by management 14 Training and seminars 14 American Express will Focus on the Development of Employees 16 Incorporate Site Visits by Management 16 Training and Seminars 17 Steps to continue the essence of customer service 18 Assessment 19 Employee feedback 19 Data analysis 20 Creating training manual 20 The use of technology 21 IX. Recommendations 22 Performance appraisals 23 Motivating Employees 24 Training employees 25 Continuous improvement 27 X. Conclusion 28 XI. References 29 I. Introduction American Express hired our consulting team to create effective training and development program to sustain the company’s success and growth. One of the departments American Express would like to concentrate on is the Customer Service Call Center. Currently American Express does not have formalized organization-wide training and development process. This paper will summarize American Express’ organizational...
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...VIDEO CASE 7 MASTERCARD: GOING UPSCALE Check, cash, or credit card? How many times have you heard that question and replied “credit card” without even thinking about it? When you do think about it, however, credit cards are a relatively new phenomenon. Yet when it comes time to pay, it seems we’re more likely to use the credit card (and to have several of them) than checks or cash. Indeed, some writers have even suggested that, in the not so distant future, we will all operate with “plastic money” all the time. MasterCard had its beginnings in 1966, when a group of banks joined together to form the Interbank Card Association (ICA). The ICA was founded by an association of banks rather than by a single dominant bank. Member committees ran the association by establishing rules for authorization, clearing, and settlement as well as marketing, security, and legal matters. In 1968, ICA went “global” by forming an association with Banco Nacional in Mexico and later with Eurocard in Europe. Since then, MasterCard has expanded around the world—even into the communist world of the 1980s when it entered the People’s Republic of China in 1987 and Russia in 1988. By 1993, China was the second largest country in terms of MasterCard sales volume. Today, MasterCard is affiliated with more than 23,000 financial institutions around the world and has nearly 370 million credit and debit cards in use . These cards are accepted at more than 13 million locations worldwide. Gross...
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...walking distance from the hospital; it is like a hotel with a dorm set-up that has rates based on your income. The Ronald McDonald House if mostly funded by donations. One way to donate is through cause marketing by buying a Happy Meal. Cause marketing (also referred to as cause-related marketing) is a type of marketing that involves the cooperative efforts of a “for profit” business and a nonprofit organization for mutual benefit. According to adage.com, the field of cause marketing began in 1983, when American Express raised money for the restoration of the Statue of Liberty. Adage.com states that “During a 3 month period, American Express offered to contribute one cent for each card transaction and $1 for each new card issued and backed the offer with a substantial media campaign.” An article on about.com entitled Cause Related Marketing: What you Need to Know goes on to say that “the results are now legendary. The Restoration Fund raised over $1.7 million and American Express card use rose over 27%. New card applications increased 45% over the previous year”...
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...Charlotte q Beers Problems facing the leader The leaders traits, knowledge and skills How the leader changed the organization Explain the leaders success or failure Ways to increase the leaders effectiveness Key learning principles q Charlotte Beers The case examines Charlotte Beers actions on assuming leadership of Ogilvy & Mather Worlwide, the sixth largest advertising agency in the world, during a period of rapid industry change and organizational crisis. q Charlotte Beers Case Objectives The case examines leadership and managing organizational change. Specifically it focuses on: q Charlotte Beers Problems facing the leader Ogilvy & Mather is in a leadership vacuum, desperate for someone to provide a new vision for the futuure the complex process of formulating a vision or new direction the need for communication to align employees to the new direction the need to align structures and systems to the new direction Situation confronting the leader Industry challenges q shift in expenditure away from mass media to targeted marketing channels q declining media expenditures q many firms inefficient in their internal operations Charlotte Beers q globalization fosters growth opportunities for those agencies which have developed international presence q as clients expand internationally, they expect great coordination across regions Personal challenges q fourth executive in 4 years q first outsider q first woman q no experience with international or multiple offices q needs...
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...Charlotte q Beers Problems facing the leader The leaders traits, knowledge and skills How the leader changed the organization Explain the leaders success or failure Ways to increase the leaders effectiveness Key learning principles q Charlotte Beers The case examines Charlotte Beers actions on assuming leadership of Ogilvy & Mather Worlwide, the sixth largest advertising agency in the world, during a period of rapid industry change and organizational crisis. q Charlotte Beers Case Objectives The case examines leadership and managing organizational change. Specifically it focuses on: q Charlotte Beers Problems facing the leader Ogilvy & Mather is in a leadership vacuum, desperate for someone to provide a new vision for the futuure the complex process of formulating a vision or new direction the need for communication to align employees to the new direction the need to align structures and systems to the new direction Situation confronting the leader Industry challenges q shift in expenditure away from mass media to targeted marketing channels q declining media expenditures q many firms inefficient in their internal operations Charlotte Beers q globalization fosters growth opportunities for those agencies which have developed international presence q as clients expand internationally, they expect great coordination across regions Personal challenges q fourth executive in 4 years q first outsider q first woman q no experience with international or multiple offices q needs...
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