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The company is best known for its premium charge cards that offer lucrative travel, retail and entertainment rewards.
American Express is introducing a new no-fee rewards credit card aimed at capturing a segment of consumers that it says has long eluded the company - people who are not big spenders and do not jet around the world for either work or play.
The company is best known for its premium charge cards that offer lucrative travel, retail and entertainment rewards, but carry high annual fees. If the popular image of those cardholders is something along the lines of the jet-setting business executive, the company has a much different target consumer for the new card: the multitasking, carpool-driving, Starbucks-hopping, grocery-shopping mom.
To appeal to her, the card - called Amex EveryDay - offers a twist on the standard rewards formula: In addition to earning one reward point per dollar charged (double points for supermarket purchases in the United States up to a total of $6,000) card holders will get 20 percent bonus reward points after making 20 or more purchases, no matter how small, in a single billing cycle.
The idea, according to Josh Silverman, Amex's president of consumer products and services, is to reward customers for frequency of use and not just the amount spent.
"We targeted a segment here who in the past has thought we didn't have a product to meet her lifestyle," Silverman said in an interview. "She's a busy mom and she doesn't have a lot of time to be traveling. She feels like some of those rewards are not accessible to her. She feels like she should not be spending in excess of $30,000 a year to earn one plane ticket."
Amex unveiled an ad campaign for the new card during Sunday night's Academy Awards broadcast, with three commercials starring Tina Fey, the comedian, actress, mother and multitasker.
One featured a busy Fey using her Amex EveryDay card everywhere from the drugstore (for chin acne cream) to the street food truck (waffles) to the dry cleaner (after her daughter smears chocolate on her coat) to the grocery checkout (where in her "hangry" haste she starts eating potpourri), all the while tallying up how close she is getting to that magic 20th purchase.
Amex is not the only card issuer that seems to consider busy mothers a key to growth. A commercial for Bank of America's cash rewards card features Katie the Hockey Mom, who goes through her harried day getting cash back for all manner of purchases, including her children's ice time, by using her BankAmericard.
She could probably be friends with the unnamed mother who is bopping to music while pumping gas into the family minivan in the ad for Chase's Freedom Card.
Amex executives offered up a mound of research on women's buying habits to explain why they had this consumer in mind (while adding that men might find the card attractive, too).
"She uses debit and credit cards about twice a day and more than 40 times a month. She tends to shop most at a few establishments, five to 10 places that are 20 minutes from her house," Silverman said.
American Express has issued no-fee cards before in an effort to widen the company's appeal. The Blue Cash card was introduced in 2003 and the Blue Sky card, which focuses on travel rewards, followed in 2005.
"We are becoming a more inclusive brand, a more welcoming brand to a broader range of American consumers, all the way from prepay to premium," Silverman said. "This is another very important step in that journey."
The company would not release information about the demographics or income levels of its card holders.
The introductory interest rate on the card will be 0 percent for the first 15 months, and from 12.99 percent to 21.99 percent afterward, the company said.
All of the new EveryDay cards will have an EMV chip, a form of technology that has been a topic of much discussion recently. The chip is widely used in Europe but is rare in the United States. Unlike the usual magnetic strip (which this card will still have, as well) the chip creates a new code for each transaction, making it extremely difficult for anyone to counterfeit the card, though stolen data from chip cards can still be used to make fraudulent online transactions.
In the aftermath of security breaches at Target, Neiman Marcus and other retailers, there have been mounting calls for the adoption of EMV chips in cards, particularly those that can only be used with a PIN.
American Express executives said that the chip in the EveryDay card would not operate with a PIN, only a signature. © 2014, The New York Times News Service
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