The American Express Card
9-509-027
REV: APRIL 22, 2011
JOHN A. QUELCH
JACQUIE LABATT
The American Express Card
Marketing is fully integrated into our overall strategy. Our largest investor, Warren Buffett, is very focused on brand health and customer metrics.
— Kenneth I. Chenault
In April 2008, Jud Linville, president and chief executive officer of U.S. Consumer Services at
American Express Company, was preparing for a meeting with Ken Chenault, American Express’s chairman and chief executive officer since 2001, and Al Kelly, president of American Express Company.
The purpose of the meeting was to discuss further growth prospects in the United States for the
American Express consumer card business while maintaining the brand’s premium positioning.
The performance of the American Express card, launched 50 years earlier in 1958, had been remarkable. By 2008, there were 52 million American Express cards in circulation in the U.S., held by
41 million “cardmembers” (see Exhibit 1). American Express commanded nearly a 24% share of U.S. credit card payments.1
As Linville prepared for the meeting, he wondered whether he could continue to rely on the same business growth drivers that had served American Express well in the past. With the U.S. economy slipping into recession, the proliferation of cards in the market required American Express to deepen its consumer understanding to provide innovative, value-added products that would attract and retain cardmembers.
Company Background
The American Express Company was a leading global payments and travel company with revenue net of interest expense of $27.7 billion in 2007, up 10% from 2006.2 American Express’s principal products and services included charge and credit card payment products and travel-related services offered to consumers and businesses around the world. American Express was the world’s largest issuer of charge and credit cards as measured by the annual value of purchases charged on these cards.3 Yet
REV: APRIL 22, 2011
JOHN A. QUELCH
JACQUIE LABATT
The American Express Card
Marketing is fully integrated into our overall strategy. Our largest investor, Warren Buffett, is very focused on brand health and customer metrics.
— Kenneth I. Chenault
In April 2008, Jud Linville, president and chief executive officer of U.S. Consumer Services at
American Express Company, was preparing for a meeting with Ken Chenault, American Express’s chairman and chief executive officer since 2001, and Al Kelly, president of American Express Company.
The purpose of the meeting was to discuss further growth prospects in the United States for the
American Express consumer card business while maintaining the brand’s premium positioning.
The performance of the American Express card, launched 50 years earlier in 1958, had been remarkable. By 2008, there were 52 million American Express cards in circulation in the U.S., held by
41 million “cardmembers” (see Exhibit 1). American Express commanded nearly a 24% share of U.S. credit card payments.1
As Linville prepared for the meeting, he wondered whether he could continue to rely on the same business growth drivers that had served American Express well in the past. With the U.S. economy slipping into recession, the proliferation of cards in the market required American Express to deepen its consumer understanding to provide innovative, value-added products that would attract and retain cardmembers.
Company Background
The American Express Company was a leading global payments and travel company with revenue net of interest expense of $27.7 billion in 2007, up 10% from 2006.2 American Express’s principal products and services included charge and credit card payment products and travel-related services offered to consumers and businesses around the world. American Express was the world’s largest issuer of charge and credit cards as measured by the annual value of purchases charged on these cards.3 Yet