American Express 2006 Annual Report Download - page 19

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A DEEPER LOOK AT RESULTS
Within each of our businesses, we focused on attracting high-spending customers, capturing
a greater share of their spending and further differentiating American Express in the
marketplace. Following are selected highlights of our 2006 results.
PROPRIETARY CONSUMER AND SMALL-BUSINESS CARDS
Spending rose 13 percent on consumer cards and 16 percent on small-business cards in
the United States. In international markets, consumer and small-business spending rose
a combined 11 percent, assuming no changes in foreign exchange rates. During the year,
we sold our card-issuing operations in Brazil, Malaysia and Indonesia to Global Network
Services (GNS) partners. As a result, billed business for these operations is now reported
as part of our GNS business.
Around the world, we signifi cantly enhanced our industry leading rewards programs,
gave business clients more ways to manage their expenses, helped merchants reach the
right customers with the right offers, and honed our data management capabilities and
risk models to be more responsive to the needs of individual cardmembers.
With First Collection, we introduced a
new level of luxury rewards exclusively
for Platinum Card and Centurion
Card members. This premium tier of
Membership Rewards provides offerings
from some of the world’s fi nest retailers
and service providers.
New Rewards. One of our major initiatives in the United States involved strengthening
Membership Rewards. Our cardmember loyalty program, now in its 16th year, is a proven
driver of growth for American Express. Average spending on cards linked to Membership
Rewards is up to four times higher than on cards without rewards. Cardmembers enrolled
in the program also tend to stay with us longer and have better payment histories.
To keep Membership Rewards at the leading edge, we introduced innovative features
such as:
• First Collection, a luxury rewards tier exclusively for U.S. Platinum Card and Centurion Card
members. Redemption partners include some of the world’s fi nest retail establishments
and service providers, such as Tiffany & Co., Lamborghini and Oberoi Hotels & Resorts.
• Bonus Points Mall, an online gateway to more than 100 retailers, where cardmembers
can earn double Membership Rewards points for their purchases. Bonus Points Mall,
which replaced our double-point promotion for certain “everyday” spending categories,
is helping to fuel more online spending with American Express cards.
innovative rewards
[ 17 ]
letter to shareholders