American Express

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American Express: Bank 2.0
Bank 2.0 was the name given to the initiative proposed by the Enterprise Growth (EG) group as a way of introducing American Express (AMEX) to the whole new world of technology (Fairchild and Jackie 3). The idea was aimed at taking advantage of the supposedly underserved consumer base. The EG was formed at the time when many bank branches were being shut down due to various reasons. Also, the affected banks reported impressive gains caused by the branch closures. As such, there was a need to provide a way through which customers would gain access to the services offered at any bank branch without necessary visiting the place physically. The only way this was going to be achieved was by making use of the technological advancements. This discussion will cover the relevance of EG’s project to the strategies of American Express as well as the anticipated difficulties in implementing it.
The initiative has almost everything that represents American Express’ strategy (Skinner 35). The overall strategy of AmEx is to gain more revenue by targeting affluent customers and handling all customer’s needs without employing other parties. With Bank 2.0, American Express was going to increase its customer’s base by engaging them via the internet. Since everything would be accessed remotely, things were going to be made a lot easier for the clients. Chances of attracting more customers, especially the affluent lot, are very high. Also, since AmEx’s strategy is to provide all the services, including the production of the cards on their own, this technology would be fitting (Skinner 36).

One of the challenges that was anticipated in the process of launching the Bank 2.0 initiative was how to describe it to the public. Given that it was a new innovation, there was a need for a precise description. In any business environment, every customer needs to know what they are being offered and how different it is from the current offers. It was going to be a challenge to the Enterprise Group because Bank 2.0 was neither a bank account nor was it a regular credit or debit card. Finally, the marketing concluded on ‘debit and checking alternative’ as the name (Fairchild and Jackie 11). However, this name was still not black and white, which means there were going to be a lot of questions in the minds of the customers.
The main reason why the name would be important was to gain trust from the target customers. One of manager product observations was that the main concern of most participants of the focus group was the security. Everyone is always skeptical when it comes to financial matters, especially when it concerns their banking needs and that is understandable. Therefore, EG was aware of the difficulty that awaited them. Like any other business entity, the trust had to be gained for maximum success to be reaped. Another notable difficulty was how the product was going to be marketed and distributed. The fact that it was not a physically distributable product was a problem by itself. Bank 2.0 required signing up, and the probability that one would not use it after registration was high, just like most upcoming online businesses. Also, contrary to a normal bank where one was given a simple booklet describing how to open and operate it an account, Bank 2.0’s needed a more advanced way of doing so.
Works Cited
Fairchild, Gregory, and Jackie Thomas-Kennedy. “American Express: Bank 2.0.” Darden Business Publishing.(2014).
Skinner, Chris. Digital bank: Strategies to launch or become a digital bank. Marshall Cavendish International Asia Pte Ltd, 2014.