Amex’s business model generates revenue from both the consumer and the merchants through expenditure on its credit cards, and finance charges and fees. (MarketLine, 2016) Although Amex provides a wide range of specialized card services and privileges and discounts across the globe, we will be focusing our attention on the Singapore market, specifically the American Express Platinum Credit Card (“Amex Platinum”) product.
The Amex Platinum gives cardholders access to what Amex describes as “Singapore’s Ultimate Dining Programme”, which notably includes the Far Card Dining Membership and the Palate Membership amongst other dining privileges. Beyond food offerings, Amex Platinum also grants cardholders exclusive lifestyle privileges ranging from nightlife to golf to movies, and attractive offers on hotel and flight bookings. Overall, the Amex Platinum is a premier lifestyle credit card that targets the mass middle-income population segment with its minimum income requirement of SG$50,000 per annum.
Amex Brand Image:
Amex’s business model attracts consumers to subscribe to and spend on its cards by distinguishing itself as a premier brand. In fact, the Amex vision is crafted as an aspiration for its service brand to be the “world’s most respected”, with attendant Amex’s operating principles, or mission, emphasizing on providing work-class service to customers befitting of the Company’s brand. The Amex brand and its attributes of “trust, security, and service” are hence critical assets to the Company, necessitating consistent corpulent investment in managing, marketing, promoting and protecting it. The result is an Amex brand that is one of the most valuable in the world (Amex, Annual Financial Report 2015).
2.) Effectiveness of Social Media Strategies:
1.) Social Media as service marketing tool
Since Amex’s inception as a corporation, it has been successful at charging a premium above its competitors’ products (MarketLine, 2015). Amex is effective in 1) offering, and 2) being seen to offer, quality service to its consumers.
First, Amex utilises social media as a means of offering quality service to its customers in the form of direct communication. Social media platforms such as Twitter (@AskAmex, 77.7k followers) have added to Amex’s repertoire of direct communication with its customers. @AskAmex is used to answer queries from cardholders in real-time between 9 am and 10 pm in the USA. Another example of quality service effectively provided through social media would be the “Link, Love, Life” application on Facebook introduced in 2011 (considered revolutionary then) where Amex delivered deals, contents, and experiences to the customer’s Facebook page based on their Facebook likes and interests. (American Express, 2011)
Second, Amex is seen to offer quality service to its customers through multiple social media platforms consistently engaging customers by posting new deals and offers on its @AmericanExpress Twitter account (874k followers) and Singapore Amex Facebook page (52.6k likes). Amex also uses hashtags on social media as a form of below-the-line advertising. Successful Amex hashtag campaigns have been aplenty. An example would be the hashtag campaign offering coupon-less discounts through Amex Facebook API. Collectively, these construct an impression that Amex is resilient to criticism and feedback, projecting itself as offering quality service to its customers.
2.) User-generated Content and Brand Community
Amex effectively facilitates user-generated content and builds its brand community. For its merchants, one prime example is the OPEN Forum (Appendix B) that was “designed to help small business owners grow their businesses by providing both insights and resources online.” While Amex sponsors some of the informative posts by industries’ experts for new business owners, a core feature of OPEN Forum is the user-generated content from users who post questions and also advise each other on achieving success. Notably, Amex does not promote its credit cards on Open Forum but has cleverly built a community in OPEN Forum centered on the Amex brand. The end state is that many businesses who have benefited from the OPEN Forum become partners with Amex, a wonderful achievement with prima facie altruistic motive. (Liz Bedor,2015).
Ineffectiveness: Lack of local engagement
One disappointment of Amex on social media is the lack of localized social media presence. Pertinent to our Singaporean case study, Amex Singapore is present only on Facebook but not on other popular platforms such as Twitter and Instagram. Given that the Amex Singapore Facebook page only has 56k followers, there is much room for improvement about Amex Singapore’s reach. Consequent to the absence of dedicated localized platforms is that marketing or PR campaigns developed specifically for the Singaporean market may only be initiated on Amex Singapore Facebook. Whether a marketing or PR campaign eventually extends to other social media platforms is uncertain, and Amex might not be able to orchestrate the public’s simultaneous media consumption. It has also been observed that Amex had not implemented social media campaigns focusing on a particular cause or group of people in Singapore and Asia Pacific.
3.) Proposed Initiatives
A.) Growing UP!
Our goal is to create a change in perception among youths and parents, which currently is one where youths usually do not get access to credit cards until they enter the workforce. The intention is to create a new social norm where youths reaching the age of 18 are entrusted with a supplementary credit card to add to their payment options and the accompanying perks afforded to them as a credit card holder.
The overarching theme of the Integrated Marketing Communication (IMC) strategy will be one which strongly plays on the characteristic of Asian societies where there are strong family obligations and interdependence (Fuligni et al, 1999). The campaign will involve traditional media such as print advertising and social media. Traditional media is chosen as that is still the dominant platform where the age group of the parents, the baby boomer generation, consumes a majority of the news information needs (“Are seniors able to cut the cable cord”, 2016). As they will ultimately be footing the bill as the main cardholders, it vital that this group of stakeholders is sufficiently engaged. Together with the increased materialism among the population (Euromonitor, 2016), we are confident that there will be demand for the product and avenue for growth.
The main objectives are to (1) change the current perception and create a new social norm where youths reaching the age of 18 are entrusted with a supplementary credit card and (2) create awareness that the AMEX Platinum card is suited for the purpose of doing so.
Phase 1: Simultaneous media consumption
The aim is to allow for simultaneous media consumption among our target market on the three main platforms: Social media (YouTube), Newspapers (The Straits Times and Business Times) and magazines (Her World, Shape and Men’s Health).
The heart-warming message pushed out on video media will be a depiction of a youth frustrated with the many problems of adolescence (e.g. social acceptance among their peers, acne as a result of puberty), followed by his parents reaching out to him, telling him that life is already tough enough as it is. As a sign of the parents’ trust in the youth’s maturity, and to make life easier, they shall be entrusting him with the AMEX Platinum supplementary credit card. The last scene will be one where this act has brought the family closer together. Concurrently, posters carrying the messages “maturity begets trust” and “trust begets maturity” (Appendix C) in traditional print media can help to advocate the mutual dependence and understanding between the parent and child.
The main aim of this phase is to change the perception of credit cards gradually by introducing this new concept of how a supplementary card can help bring the family together. The ratio of the existing supplementary card to main card holders is approximately 0.18 (MAS, 2016) and a successful campaign will lead to a rise in the percentage across all credit cards. This phase lasts for a month to create enough impression for the awareness among the population.
Phase 2: Infotainment & Native Advertising
Phase 2 will largely encompass pushing out informational content about the product and a clear call to action, principally on the same media platforms and, importantly, also digital social media blogs. With the increased influence money blogs as a source of financial information have, especially regarding the privileges different credit cards offer, the aim of this phase will be to educate and advertise the specific purpose of the AMEX Platinum Credit Card as one which will be able to serve the aspirations of youth. This will be done through a native advertising post on the three money blogs (Blog MoneySmart, Dollars and Sense and Money Digest). The title of the post will be “Top 3 Cards for the Young and the Young at Heart”. The post will list the various perks mainly aimed at youths that are associated with this card.
B.) Everyone’s Using It!
After creating the change in perception of supplementary credit cards among the parents, the next stage of the IMC would be to create the demand for the cards from the ground up, by engaging and marketing to the end-users directly as well as increasing and sustaining the various stakeholders.
The objectives of this marketing campaign are twofold. (1) The campaign seeks to increase the reach, product association, and recall. (2) Increase the user experience through the expansion and curating of a list of participating merchants.
Everyone’s Using it!
As a product similar to the current Amex Selects, the product aims to comprise a list of hip cafes and bars catering to the list of places our target market frequents. Amex will have first to partner a list of 50 cafes such as Sunday Folks, Common Man Coffee Roasters, and Chye Seng Huat Hardware Coffee, et cetera. which are tremendously popular among the youth as part of the coffee house culture (Euromonitor, 2016).
Phase 2 (#AMEXfoodietrail):
The social media platforms of Instagram and Facebook have been selected as the medium to market the cards to the youth since Instagram provides the ability to create real-time visually appealing imagery. To generate interest in and to spread the perks of the Amex Platinum Credit Card, weekly competitions will be held where participants have to take photos of their food at participating outlets. Participants have to add the hashtag #AMEXfoodietrail to all photos up for submission, and the eventual winner will have to show proof of purchase if selected. The prize for the competition will be discount vouchers at various participating outlets. This phase will be launched and ran concurrently with the “Growing Up” initiative.
Phase 3 (#30daysoffoodheaven):
With the spread and eventual proliferation of AMEX supplementary cardholders, the next step would be to increase purchasing intent and consumption. Phase 3 shall be accomplished through a different competition held on Instagram and Facebook. This competition seeks to create a challenge where participants have to visit 30 participating food outlets in 100 days. This will be tracked through the posting of the hashtag #30daysoffoodheaven. A cash prize of $1000 will be given to the winner picked through a lucky draw system of all eligible contestants who completed the challenge.
Phase 4: Virtuous Cycle
To create a virtuous cycle where the list of merchants is constantly increasing and changing to reflect the taste of the users, polls will be periodically sent to users to allow them to “talk back” and request popular locations. There will also be ongoing stakeholder engagement with the vendors to gauge the popularity of the various social media campaigns and partnerships with their organic promotions. With the continuous review and active curation of the list of merchants, there will be a growing demand for the card and a strong brand association among trendy lifestyle seeking youths.
As a relatively conservative society, there may be skepticism by the public about the counter-norm practice of advocating the issuance of the supplementary card as it might be seen as encouraging spending beyond one’s means. Therefore, to counter this, it is crucial to add in subliminal messages into the video to promote responsible spending.
There is also the risk of the various campaigns not gaining enough traction and therefore falling short of its goals. As there is no sure recipe for a viral post, there is always the possibility of the Instagram competitions flopping. Therefore, to mitigate this, a strong native advertising campaign is essential as it would provide moderately to highly involved customers the require information on the platforms they frequent.
Lastly, it is integral that the communication during the social media campaign is 2-way. Therefore, to mitigate any negative feedback arising from not being able to land any restaurant requested by the customers, the feedback loop should be closed, and they should be informed. This would prevent the loss of confidence that the feedback channel works and is integral to maintaining a positive sentiment towards the entire campaign.
Ultimately, the success of the campaign hinges on the ability to run a successful IMC, which ensures that there is strategic campaign development. However, in addition to the congruency of the message over the various platforms, there is the additional challenge of ensuring the market efforts reach both the parent and the child of a family to be successful. Therefore, it is very important to ensure that the right platforms are chosen and that the various initiatives achieve its intended purpose.
-Rachel, Weijun, Shaun