For a lot of, the American Categorical card is seen as a badge of success. However, as many cardholders in Europe will know all too nicely, outdoors of the foremost cities, Amex is usually rejected by retailers.
However as the worldwide bank card big continues to make inroads with reluctant retailers, it’s betting on sweeping up younger clients with the assistance of the world’s largest pop stars.
Amex’s chief working officer Elizabeth Rutledge advised Fortune that Gen Z and millennials had been now buying 68% of its playing cards globally.
These youthful customers are hooked on life-style perks like leisure, eating, and journey. Amex now caters to these wants with a giant concentrate on the leisure sector.
“It’s experiencing the excitement of a Formula One race, or it’s getting access to some exclusive dining experiences,” Rutledge mentioned.
Within the U.Ok., Amex has focused younger Brits with partnerships at London festivals like British Summer time Time and All Factors East. Cardholders can profit from early entry to tickets and obtain perks on-site.
The group partnered with Gen Z pop famous person Olivia Rodrigo final yr on her profitable second album, Guts, and a corresponding sell-out international tour.
Amex hosted a particular occasion in Berlin following Rodrigo’s live performance there, the place card members and different followers loved native artists and DJs at an after-party. Followers additionally obtained entry to devoted checkout strains for limited-edition merchandise.
The truth that reportedly almost 60% of Gen Zs describe themselves as “super fans” of their favourite artists, Rutledge says, will increase the attraction of those perks.
As well as, Amex affords card members the possibility to attend unique eating occasions, together with new restaurant openings, together with Nice British Menu winner Dan McGeorge’s new spot Vetch in Liverpool.
The hope is that getting a youthful viewers into Amex means they are going to stick with the cardboard as their incomes develop into their later years.
“They’re really representing a strong potential lifetime value for us, given that we can be with them through all their different life cycles as their needs evolve and change.”
Amex’s playbook is the similar within the U.S., the place the group realized Gen Z and millennials’ common demand for experiences and commenced adjusting their rewards.
It marks a pivot from a historic concentrate on points-based rewards and different advantages, which proceed to in sustaining spend amongst members. Partnerships with sure merchandise, like Disney+, enable customers to learn from discounted subscriptions. Purchasing with different retailers, like RayBan, provides Amex clients cashback alternatives.
Amex has tried a number of methods prior to now to woo younger clients, but it surely’s proved to be a studying curve.
“Until about 10 to 15 years ago, we thought that no-fee cards were the entry point to bring in younger customers to the franchise,” Howard Grosfield, president of U.S. client companies at American Categorical, advised Fortune in June.
“We’ve learned that that’s not the right strategy for millennials and Gen Zs. They like the brand affiliation. They like to travel and eat out, and they like the special access and experiences that come with our premium cards.”
Amex nonetheless expects its younger customers to make higher use of its conventional rewards system as they age. Within the meantime, although, getting Gen Z and millennials hooked on experiences is proving a profitable gateway to them holding down Amex playing cards.
Nonetheless, Europe continues to pose obstacles to the corporate’s progress.
European inroads
Amex has lengthy lagged behind in Europe in contrast with its presence within the U.S. Retailers and meals distributors, significantly small ones, have been reluctant to just accept the cardboard of their shops owing to excessive transaction charges. They’ve as a substitute opted to just accept Amex’s arch-rivals Visa and Mastercard.
The group is utilizing third-party partnerships, together with a cope with PayPal, to permit customers to make use of their Amex on the continent.
“We’re focused on expanding acceptance in key cities where our card members live, work, and travel,” Rutledge mentioned.
Amex’s rewards applications have lengthy been its USP in opposition to different bank card suppliers, and as Gen Z and millennials get hooked on Purchase-now, pay-later corporations like Klarna, Amex is leaning into perks the interest-free lender can’t compete with.
Nonetheless, Amex’s charges proceed to hinder the corporate’s means to get Europeans to spend on its playing cards, in addition to the thousands and thousands of Individuals who journey to the continent yearly.
In June, eBay banned using Amex on its website, citing “unacceptably high fees,” making a danger that different retailers could comply with swimsuit in an ongoing warfare over bank card charges. Clients are nonetheless ready to make use of their Amex on eBay by means of PayPal.
“We’re definitely disappointed that eBay made the decision to stop accepting American Express cards,” Rutledge mentioned.
“By doing so, I think they’re going to limit customers’ payment choices and take away that service and that security.”
Rutledge added that eBay solely represents 0.2% of its complete community quantity.
