American Express Company · NYSE:AXP
American Express — Investor Day (August 2011)
50 slides from American Express's investor day presentation, Aug 3, 2011
Slide 1: American Express Company Financial Community Meeting
American Express Company Financial Community Meeting Kenneth Chenault Chairman and Chief Executive Officer Dan Schulman Group President, Enterprise Growth August 3, 2011
Slide 2: Enterprise Growth Group Created to Focus on Key Opportunities
Enterprise Growth Group Created to Focus on Key Opportunities 57
Slide 3: Agenda
Agenda ■ The Commerce Landscape ■ Our Digital Commerce Vision ■ Building the Payments and Digital Commerce Platform ■ New Payment Products and Services ■ Fee Based Opportunities ■ Conclusion 58
Slide 4: Payments and Commerce are Being Redefined
Payments and Commerce are Being Redefined Explosion of technology Consumers and merchants’ changing commerce behavior Explosion of data driven innovation 59
Slide 5: Mobile Enables Smarter Connectivity
Mobile Enables Smarter Connectivity 10B+ 42% 81 Connected US cell phone Average minutes mobile devices owners that smartphone users worldwide by have a spend daily on 2015 smartphone mobile apps Source: Morgan Stanley 2010, Pew Internet and American Life Project 2011, Flurry Analytics 2011 60
Slide 6: The Digitally Enabled Consumer
The Digitally Enabled Consumer Leveraging digital tools Making smarter purchase decisions Harnessing the power of social commerce 61
Slide 7: Merchant Landscape Redefined
Merchant Landscape Redefined Leveraging technology and data analytics Micro-segmenting and targeting customers to enhance marketing efficiency 62
Slide 8: Explosion of Data Driven Innovation
Explosion of Data Driven Innovation Data is the crown jewel of retail platforms Driving smarter algorithms Dramatically improving marketing ROI 63
Slide 9: Privacy and Security are Imperative
Privacy and Security are Imperative Obligation to safeguard cardmember data Transparent and responsible use of data Highest standards of privacy protection 64
Slide 10: We are Uniquely Qualified
We are Uniquely Qualified ■ Brand ■ Marketing / Sales ■ Customers ■ Premium Positioning ■ Risk Management ■ Merchants ■ Channels ■ Info Management ■ Business Partners ■ Closed Loop Data ■ Servicing ■ Processing Infrastructure 65
Slide 11: Agenda
Agenda ■ The Commerce Landscape ■ Our Digital Commerce Vision ■ Building the Payments and Digital Commerce Platform ■ New Payment Products and Services ■ Fee Based Opportunities ■ Conclusion 66
Slide 12: Our Digital Commerce Vision
Our Digital Commerce Vision Redefine the commerce experience for buyers and sellers Personalize the shopping experience Transform the power of marketing 67
Slide 13: Capturing New Opportunities
Capturing New Opportunities ■ New customer segments ■ New products and services ■ New markets 68
Slide 14: Agenda
Agenda ■ The Commerce Landscape ■ Our Digital Commerce Vision ■ Building the Payments and Digital Commerce Platform ■ New Payment Products and Services ■ Fee Based Opportunities ■ Conclusion 69
Slide 15: Serve Launched on March 28th
Serve Launched on March 28th My take is that they smoked the market … It's a tremendous play, and they have developed it at a time when no one expected Amex was going to come out with anything interesting. -March 28, 2011 Uh oh, PayPal; looks like you’ve got a new challenger in the person-to-person
Slide 16: Building the Serve Platform
Building the Serve Platform Fund Serve account from …and use Serve wherever many sources… you need to pay 71
Slide 17: Serve Bridges Online and Offline
Serve Bridges Online and Offline Online and offline payments @ millions of merchants who accept American Express today 72
Slide 18: Innovative New Applications
Innovative New Applications 73
Slide 19: Serve in Continual Release
Serve in Continual Release Flexible software platform allows for rapid iterations New releases expected every few months Pilot test in Eugene, OR 74
Slide 20: Robust Capabilities Now and in the Future
Robust Capabilities Now and in the Future Expand to international markets Load with cash and virtual 2012 currencies Today: Launch Serve personalized payments offers platform functionality 75
Slide 21: Enabling New Merchants
Enabling New Merchants Individuals as merchants Digital and virtual goods businesses Online micro-businesses Offline and local small businesses 76
Slide 22: Serve Enables the Convergence of Online and Offline
Serve Enables the Convergence of Online and Offline Traditional and new competitors are racing to crack the code Serve’s open and flexible platform can deliver a comprehensive solution Note: The trademarks, logos and service marks used on this slide and throughout this presentation are property
Slide 23: A Robust Roadmap to Scale
A Robust Roadmap to Scale Form mutually beneficial partnerships Open the platform to developer community Facilitate new digital capabilities to existing cardmembers 78
Slide 24: Rich and Growing Partnership Base
Rich and Growing Partnership Base Note: The trademarks, logos and service marks used on this slide and throughout this presentation are property of their respective owners. 79
Slide 25: Ticketmaster: Serve in Ticket Purchase Flow
Ticketmaster: Serve in Ticket Purchase Flow Promoting Serve to tens of millions of Ticketmaster customers Enabling P2P payments for group ticket purchases Note: The trademarks, logos and service marks used on this slide and throughout this presentation are property of their respective owners. 80
Slide 26: Aol Patch: Serve Providing Offer Capabilities
Aol Patch: Serve Providing Offer Capabilities Promoting Serve to 2-for-1 millions of Aol Patch.com Pizza customers Provide local businesses seamless and targeted Add to Serve Account offer capabilities Note: The trademarks, logos and service marks used on this slide and throughout this presentat
Slide 27: Verizon Wireless: Serve as Rollover Payment Option
Verizon Wireless: Serve as Rollover Payment Option Promoting Serve to tens of millions of Verizon Wireless customers Please enter your PIN Links Serve account to mobile number and provides rollover payment option Note: The trademarks, logos and service marks used on this slide and throughout thi
Slide 28: Open APIs to Drive Scale
Open APIs to Drive Scale Open platform enables scale through distributed innovation Planned APIs – mobile checkout and negotiations functions Robust plan to engage the developer community 83
Slide 29: Engaging Current AXP Cardmembers
Engaging Current AXP Cardmembers Make Serve capabilities available to current cardmembers Integrate into existing Amex experience 84
Slide 30: Serve Economic Drivers
Serve Economic Drivers ■ Earn discount revenue ■ Earn affiliate and ■ Earn float revenue commission revenue ■ Earn cross border fees ■ Low rewards expense ■ Minimal credit losses ■ Cost of customer funding options ■ Low acquisition costs 85
Slide 31: The Digital Commerce Prize is Even Bigger
The Digital Commerce Prize is Even Bigger $364B $144B 2009 2009 US Consumer US Marketing and Credit / Charge Advertising Spend Issuing and Acquiring Potentially Available for Revenue Pools New Digital Solutions Source: McKinsey US Payments Map March 2011 (2009 US Consumer Credit and Acquiring Revenu
Slide 32: Agenda
Agenda ■ The Commerce Landscape ■ Our Digital Commerce Vision ■ Building the Payments and Digital Commerce Platform ■ New Payment Products and Services ■ Fee Based Opportunities ■ Conclusion 87
Slide 33: A Global Opportunity in Payments
A Global Opportunity in Payments ($ in trillions) Total = $32 Trillion Prepaid $0.3 ACH $4.1 $26 T Credit / global payments Charge Cash and $5.8 Checks volume in $17.3 Debit payments outside $4.7 of credit / charge Source: Euromonitor June 2011, excludes ATM withdrawals. 88
Slide 34: Capitalizing on Different Opportunities for Different Market Types
Capitalizing on Different Opportunities for Different Market Types Credit Centric Debit Centric Cash Centric ■ More advanced digital payments ■ Electronification of cash through and commerce solutions prepaid-like products and mobile Source: McKinsey Global Payments Map, 2008 89
Slide 35: Mobile Likely Catalyzes Digital Payments in China and India
Mobile Likely Catalyzes Digital Payments in China and India 900MM 700MM mobile users mobile users 200MM credit cards 20MM credit cards Source: Reuters June 2011, Euromonitor 2011, Plugged In July 2011, BCG July 2011 90
Slide 36: Alternative Forms of Payments are Prevalent in Many Parts of the World
Alternative Forms of Payments are Prevalent in Many Parts of the World Travel cards Domestic and Payroll and benefits international Government remittances disbursements 91
Slide 37: Launch of Reloadable Prepaid is the Foundation for Future Products
Launch of Reloadable Prepaid is the Foundation for Future Products Champion of the consumer by loading with benefits, not fees 92
Slide 38: Market Leading Consumer Value
Market Leading Consumer Value Monthly No Yes Yes Card Replacement No Yes Yes Purchase Protection Yes No No Roadside Assistance Yes No No Note: The trademarks, logos and service marks used on this slide and throughout this presentation are property of their respective owners 93
Slide 39: Positive Press and Industry Feedback
Positive Press and Industry Feedback Many prepaid cards are known for charging fees …But Show website screen shot American Express came out with a reloadable prepaid card this week that appears to right the industry’s wrongs… -June 14, 2011 …believe it will serve as a nice complement to AXP’s produc
Slide 40: Traditional and New Distribution Channels will Bring Scale
Traditional and New Distribution Channels will Bring Scale Online distribution Decline counteroffer Dual purpose Membership card with prepaid functionality Sold in stores “on the racks” Note: : The trademarks, logos and service marks used on this slide and throughout this presentation are
Slide 41: Prepaid Delivers Favorable Economics
Prepaid Delivers Favorable Economics ■ Earn discount revenue ■ Earn float revenue ■ Minimal reward expenses ■ Minimal credit losses ■ Low acquisition costs 96
Slide 42: Agenda
Agenda ■ The Commerce Landscape ■ Our Digital Commerce Vision ■ Building the Payments and Digital Commerce Platform ■ New Payment Products and Services ■ Fee Based Opportunities ■ Conclusion 97
Slide 43: Our Fee Based Initiatives Support our Digital Commerce Vision
Our Fee Based Initiatives Support our Digital Commerce Vision $3.0B $1.3B 2011 2014 Estimated Target Note: : The trademarks, logos and service marks used on this slide and throughout this presentation are property of their respective owners. 98
Slide 44: Loyalty Partner: Loyalty at Scale
Loyalty Partner: Loyalty at Scale Leading marketing services company operating loyalty programs in Germany, Poland, and India Adding more than 34MM customers to our franchise 99
Slide 45: Accertify: A Leader in Fraud Prevention
Accertify: A Leader in Fraud Prevention A leader in solutions that help merchants combat fraudulent online transactions Comprehensive end-to-end fraud management platform 100
Slide 46: Vente-Privée: Online Private Sales
Vente-Privée: Online Private Sales The venture is another step in American Express’s effort to gain more business from processing the transactions of wealthy customers, especially via new technology like online and mobile commerce. -May 12, 2011 The benefit for American Express is that it has a cool
Slide 47: Agenda
Agenda ■ The Commerce Landscape ■ Our Digital Commerce Vision ■ Building the Payments and Digital Commerce Platform ■ New Payment Products and Services ■ Fee Based Opportunities ■ Conclusion 102
Slide 48: The Right Investment Balance
The Right Investment Balance Continuous Release Proprietary Assets and Capabilities Flexible and Nimble Capital Strength Efficient and focused investments to drive scale 103
Slide 49: The Journey Continues
The Journey Continues Continue to make strides company-wide And we know that this is just the beginning… 104
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