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