American Express 2004 Annual Report Download - page 18

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We extended our successful alliance with Costco and launched new co-branded cards for
consumers and small businesses with a unique cash-back value proposition.
We enhanced our Membership Rewards program by expanding into new industries and
adding a wide range of partners, most notably JetBlue Airways.
We continued to expand our card offerings in the small business arena, where American
Express is the market leader. In addition to the Costco TrueEarnings Business card, we
also introduced Business Green Rewards and Blue Cash for Business, as well as a new
savings program for small-business owners called OPEN Savings.
We introduced American Express Selects, a new global cardmember benefit with nearly
4,000 premium shopping, dining, travel and entertainment offers and experiences from
merchants in 24 markets.
We launched more than 80 new or enhanced proprietary card products in international
markets including consumer, commercial, co-brand, distribution and affinity cards.
We launched new corporate card products to add to our leadership position in this seg-
ment, including a new jointly branded card distributed by Deutsche Bank, as well as
enhanced online travel and expense management offerings.
We signed agreements with Delta Air Lines to extend our co-brand, Membership Rewards
and merchant partnership into the next decade.
We expanded the network of merchants that accept American Express cards around the
world, including signings in new industry categories. We also launched Business Savings
— a new program that offers merchants who accept American Express cards discounts
on a variety of everyday business expenditures.
American Express has the broadest array of charge, lending and co-brand card products
and rewards programs across the consumer, small business and corporate segments.
HISTORIC CHANGE IN U.S. CREDIT CARD MARKET
As I mentioned earlier, the biggest news in the card industry in 2004 was the Supreme Court
decision that paved the way for open competition among card networks in the United States.
In January 2004, in anticipation of that result, we announced our agreement for MBNA to
issue American Express-branded cards targeted to its high-spending customers and
prospects. MBNA began issuing these cards in November, following the Court’s decision,
and the launch got off to a great start. Response has been strong and overall spending vol-
umes and average transaction size have been even higher than we expected. In December,
we announced our agreement with Citibank, one of the world’s leading financial institutions,
AXP
AR.04
—
16
$296.7 $298.0 $311.4
$352.2
$416.1
Spending Power_ In 2004, worldwide spending on American
Express cards reached an all-time high of $416 billion, up
18 percent from a year ago. This performance exceeded the
organic spending growth of all major card issuers.
CARD BILLED BUSINESS (in billions)