Essay About Win-Win Situation And American Express’ Business Strategy

American Express
1.How does American Express’ business strategy differ from those that Visa, Mastercard and issuing banks pursue? Firstly, American express had a direct relationship between customers and merchants. Thus, they were more engaged than other financial service firms. So, American Express could easily negotiate with merchants without the help of third parties. Moreover, they knew good amount of information So they didn’t outsource marketing and strategy planning and execution to consulting firms.Therefore, American Express can be a great marketing partner for merchants.It had information about customers and merchants since it issued its own cards, settled the funds, and managed merchant settlements. American express thus enjoyed higher power to influence both. On the other side, Visa and MasterCard never focused on these functions so they had less data and low engagement with consumers and merchants.American express had the ability to view actual transactions between merchants and cardholders whereas other two did not.2. How does EACH of the following impact American Express’s profit and card holders’ social relationships? Members Project: AmEx had to donate $2 Million to one customer’s project and this effort was supported by UNICEF. Since AmEx was financial sponsor, it created an emotional bond with customers. Top 5 projects were announced in 6 days so it created a positive image in the world for AmExMembers know:  The Card members responded very well to this travel community. AmEx could use the posts and comments to strengthen relationships with the travel agencies, hotels and restaurants. This would help AmEx to become a global player. The consumers trusted this site.OPEN forum: This helped small businesses to survive post 2008 market crash. It helped small businesses owners to interact with other owners and exchange ideas and suggestions. AmEx thus received all support from these business to strengthen its business community.Link/Like/Love: This resulted in higher sales for merchants and AmEx was a major contributor for this. Consumers liked and loved the deals. In addition, merchant’s business was doing better. Gradually, AmEx eased the process so there was not additional burden on merchants to train their staff. So, it was a win-win situation for consumer, AmEx and merchant. 3. Should American Express pursue “broad” option or “deep” option first? Explain your rationale backedup by your assessment.Broad: AmEx can target India and increase its influence there. Numerous students from India migrate to USA for higher studies so AmEx can establish long lasting relation with them. Also, AmEx can establish its infrastructure and network in India so that all transactions are supported anywhere in India. Thus, students and American tourists will prefer AmEx cards more than other card providers. Also, several multinational organizations are growing in India so it is one of the best places to create social and financial relationships in Indian region.