Analysis Of American Express

Introduction: This paper is meant to conduct an environmental scan of both the general and specific environment for American Express. Along with the examination of environments, an analysis of those environments and possible opportunities and threats will be further discussed. When analyzing the general environment of American Express, it will be covered in five sectors, which include demographics, technology, social-culture, economic and political-legal. "The competitive environment for AmEx is very challenging" (Associated Press, 2015); that is, there is a great deal of pressure on American Express. They establish their own competitive advantages and threats in these sectors. To analyze the specific environment of American Express, Porter’s

American Express cardholders are least likely to live in the South, which is in contract to Discover cardholders. People who are considered to be in the Connoisseurs and Top Rung categories are usually wealthy, and educational with high quality of life and are the target market of American Express. In the previous financial crisis, the U.S. economy recovery is still sluggish; with many entrepreneurs go through crisis on their businesses; they lost their buying power, and thus spend less money by using their credit cards. Therefore, the American Express gained fewer revenues from service fees and interest revenues. This trend influences American Express’s profit directly. To deal with this downward trend, American Express’s strategies has been focusing more to opposite directions. It now has two pre-paid debit cards, one of them with Wal-Mart (Associated Press, 2015). This new type card gives low-income consumers incentive to spend money. There are no hidden fees, no credit check. people can pay bills online, withdraw cash from 22,000 ATMs, enjoy global assist services, they are protected from purchasing, overdraft, and fraud (Daniel,

In the past, people buy big-ticket items through a credit card and they pay back in a few months so that they can make expensive goods more affordable. Now, people are using a credit card to enhance their life quality and buy things recklessly. It is a very dangerous action in such an unstable environment. Credit default is a big issue all of the time. Credit card holders are not only suffering the higher price but also compounding it by packing interest expenses into the costs of everyday purchases. Therefore, American Express announced that there is no annual fee SimplyCash Plus Business Credit Card, which has the huge impact on small businesses’ growth. With the development of small businesses, American Express hopes the new power can enhance the U.S. economy recovery, so that more consumers have faith in credit