Has Amex damaged their brand?

American Express forum. Talk about AmEx credit cards like Blue, Gold, Platinum, Centurion, and more.
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Has Amex damaged their brand?

Postby otter » Fri Nov 08, 2013 11:14 pm

Take a trip back in a time machine with me back to twenty years ago. Sure, we'll go to the Nirvana concert, but first let's see what's in the average Joe Six-Pack's wallet. Chances are he probably has a Visa and/or MasterCard credit card (but not a debit card) in his wallet, but no Amex card. If he is one of the exclusive few people who has one in his wallet, it's almost surely issued by American Express, not someone else. Because banks which issued Visa and/or MasterCard at the time were prohibited by their licensing agreements with V/MC from issuing either Amex or Discover cards.

Sure. American Express wanted a piece of the bank-issuing pie, but there were upsides to this dilemma. American Express was the most exclusive card issuer in large part because they had total control over who got an American Express Card. There were a few rare exceptions- some brokerages offered American Express deferred debit cards and similar cards, but they themselves were pretty exclusive as well. I remember reading a financial book from the late 80's and one of the recommendations in the chapter on credit was to get an American Express Card and keep it. At the time, credit issuers would see American Express in your file and look no further. If Amex approved you, you were almost guaranteed a car loan or mortgage. So American Express may have lost out on a ton of bank-issuing fees, but their reputation was golden. Couple that reputation with impeccable service and benefits and as those Visa commercials might say- was priceless...

Fast forward to a few years ago... American Express(and Discover) win their antitrust lawsuit against the "big two" and wins the right to let other banks issue cards on their network. So did Amex win the battle, but lose a bigger war?

So today we have lots of banks which issue Amex cards including FNBO which issues cards on all of the "big four" networks and Bank of America. True, their Amex cards tend to usually be one of the higher tier cards, but it's only a matter of time before we have the Amex equivalent of "the Matrix Card" or even the "Credit One Amex Card." There's even Amex prepaid cards such as the Bluebird card. So in twenty years, we've gone from someone proudly pulling out their Amex card and giving it to the merchant knowing that they will be treated well simply because "Amex = High spender" to having the people from "My Name is Earl" slapping their prepaid Amex card loaded with their welfare check onto the Wal-Mart counter. And when Earl has a problem with his First Progress Amex card, calls the number on the back of the card, and gets poor customer service from somebody in Bangladesh whose knowledge of English is limited to what's written on his cue cards, he tells everyone he knows how much American Express customer service sucks.

I know I sound a little bit "snooty" in this post, but I'm just trying to think of this from Amex's point of view. I know they've made a ton of money from the extra bank fees in the past few years, but have they damaged the brand they've spent decades trying to build? Even their premium products no longer have the same air of exclusiveness about them. It used to be "the Gold Card" and "the Platinum Card" only meant one thing, but today you can go to the First Premier website and get approved for a gold AND platinum card in five minutes. Even the most exclusive of exclusive cards' nickname (the Black Card) isn't owned by Amex. The term "Black Card" is trademarked by Visa!

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In my Wallet:
  • Amex PRG NPSL[3-14, bd 91]
  • Sallie Mae MC $8000[1-14]
  • Chase Freedom $4700[1-14]
  • Discover It $2750[8-13]
  • BoA UCF Alumni Cash Rewards $5000 [3-15]
Sometimes in my Wallet:
  • GM BuyPower WEMC $5000[9-14]
  • Wells Fargo Propel 365 Amex $7000[4-14]
  • Barclaycard Arrival WEMC $7000[3-14]
  • BoA Better Balance $3000[2-15]
In my sockdrawer: Amex BCE $1000[10-13, bd 91], OCCU Duck $10000 [11-13], The Sportsman's Guide Visa $8000[8-14], Chase Slate $4000 [9-14]Delta Gold Amex $2000 [2-15 bd 91], Diners Club MC $20000 [10-14] Commerce Bank Visa $2000 [3-15] Citi Double Cash $1000 [3-15]
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Postby whit » Fri Nov 08, 2013 11:27 pm

i don't think its that complicated.

american express at the end of the day is a company, a publicly held company that has to turn a profit for its shareholders.

yes, they can make good money off of the rich, but when you're in that market of 'exclusive' you limit your marketshare. you limit your chances of making $$ and don't forget, the rich can fall, and fall hard.

they're still picky, but not as picky as they used to be.

and as a credit card company who again is publicly held, they cannot afford to be too picky.

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Postby SClay » Sat Nov 09, 2013 2:16 am

Hey there! I can somewhat agree that they have damaged their brand, but they're still a very prestigious brand nonetheless. And while you can apply for a First Premier gold and platinum card, that doesn't mean they're the same thing ;-). I could say I have a black card and only have the black-colored amazon visa card from Chase LOL.
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Postby RewardHop » Sat Nov 09, 2013 3:19 am

What do we really care about though? Damaging the brand? OR more importantly will it erode our benefits?
I tend to think the latter.
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Postby MemberSince99 » Sat Nov 09, 2013 7:58 am

The thing is, it's a for profit corporation. That means your primary goal is to pad the wealth of your investors who demand increases every quarter, not to mention as a corporate executive padding your bonus which you also want to see go as high as possible.

So money talks far more than brand. And from what you've said yes they have, but I doubt they care as they are profitable and that's what it is really all about.

Personally whenever I call and get a CSR who sounds like they should be at Capital One it damages the brand in my mind but maybe that's just me. I'm sure their top tier investors who have Centurions and only talk with the best of the American reps never know what that's like. They gotta do what they gotta do.

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Postby Userofcards » Sat Nov 09, 2013 9:03 am

I don't know if Amex has damaged their brand. Maybe it is no longer seen as being as exclusive as it once was. But I do wonder how exclusive it was even 20 years ago. My parents both had Amex cards when I was growing up in the late 1980s and early 1990s. Both my parents were educators, they had a decent but modest income, and we lived in a modest 3 bedroom house.

I know Amex is often seen as something for the affluent. Obviously Amex has many products geared toward the affluent and the rich. But I wonder if my parents were somehow some kind of exception or if some sort of Amex product has long been available to people with a decent income and no history of credit troubles.

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Postby GoCreditGo! » Sat Nov 09, 2013 9:26 am

*disclaimer, how a newbie (me) sees it:

AMEX is known not for the black card, but for the Centurion. Any american express that is not a charge card has already "tarnished" its brand name, so I think this was a strategic move back in the day when they started rolling out credit cards to grow as a company (and generate ROI to investors). As for exclusivity, you can't have it without having an amazing brand and with the way the economy works, most - if not ALL - brands need to diversify their customer base to stay solvent. Rolex has sub 5k watches. They never used to make these, but now these are the bread and butter of that organization (as an example). I think it is a business decision. If "Earl" decides that he has terrible customer service and cancels his card, that does not make me stop using my gold and platinum charge cards. In fact, to me (and maybe other holders), we understand that we still receive excellent customer service and when "Earl" stops using the card, our cards remain more exclusive and AMEX might give us even more benefits just to retain higher net worth clients. Stores will continue to accept it and life will continue.

Sorry for the rambling. I guess what I am trying to say is, to me AMEX has always been a higher end company. Sure they dabble with prepaid products, but many of those actually stay? Red Card, AMEX Me, Zinc, etc. They try and try, few "free" cards have tenure like the charge cards do. Perhaps one day we will see Blue go bye bye.

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Postby Snowman » Sat Nov 09, 2013 11:10 am

Growing up, I always thought they were the cards of well off, affluent people. It was only when I started to coming to forums like these did I see that normal-everyday people who have good credit are getting approved. Times change I think, and in order to be more profitable they started letting more people in who have good credit and not just affluence either. But Karl Malden is rolling in his grave...lol.
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Postby CC Deville » Sat Nov 09, 2013 11:32 am

I think you answered yourself with the Visa Black card in that it is all about perception...I enjoy a silent laugh at the expense of anybody that fell victim to opening that silly card. It is all about marketing. Even though the Centurion is called Centurion, most people refer to it as a "black" Amex and cream their shorts over it. So, Barclay's Bank decided "hey, lets ride the coat tails of the Centurion and call ours 'The Black Card' so people will think it is exclusive." Yeah, that exclusive card with advertising banners all over CNN.....but it shows how uninformed American consumers are. Honda does it with Acura...put some lipstick on a Honda and charge more $$ for it and Americans eat it up (well, their SUVs anyway but that is a different topic).

My point is, most people are not really well versed in the credit card world and still view Amex as exclusive and even mysterious. Those of us in the know realize that some of the cache of Amex has been diminished, but Average Joe and Average Jane still get impressed by a "real" (Amex issued) credit card including the Zync which tells you how little they know about the different levels. I think if you whip out any of their charge cards people will be impressed by it.

Another example is luxury and "premium" cars (can you tell I'm a car guy?). Back in the 80's and even 90's Mercedes, BMW etc were reserved for people who were well to do or affluent. But, in the past 15 years or so auto leases have become very popular. Popular enough that now Average Joe can afford a $399 lease on a Baby Benz or 3 Series instead of financing a soulless, brainless appliance called Camry. So, one could argue that a C Class, 3 Series etc no longer has the same lure as they used to because now everybody can get one.

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Postby GoCreditGo! » Sat Nov 09, 2013 12:31 pm

I agree. AMEX has opened it up to the masses, but to those that know, they know and there are tell-alls all over the place.

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