AMEX BLUE TAKES BITE OUT OF COMPETITION'S OUTSTANDINGS AND MARKET SHARE
(ATLANTA, May 22, 2000) Not only has the American Express Blue card
already exceeded its distribution goals for all of 2000, the card has
attracted a substantial number of revolvers and transferred balances from
major competitors. These independent findings emerged in the analysis
section of a just published consumer study conducted by Brittain Associates.
When launched in September of 1999, Amex predicted that by the end of 2000
there would be 1.5 to 2.0 million Blue card accounts opened. Recent Amex
statements revised that estimate to "3 to 4 million", a volume that the
Brittain Associates study indicates is very likely, given the measured count
of Blue card ownership of just over 2.0 million through mid-April.
"One half of these Blue owners were not Amex customers before they got their
Blue card," says Bruce Brittain, president of the Atlanta-based research
firm. "Even better, for Amex, is the $1.8 billion in transferred balances
that have resulted to date. Add to that the revolved balances resulting
from Blue spending, and the revolved outstandings are likely to now be $2
billion or more.
In total, 45% of Blue owners say that the new card has replaced another card
in their wallet. The competitive brands most impacted by Blue are
MasterCard and Visa cards issued by Citibank, MBNA and Chase plus the
Discover card. And, while there has been some cannibalization of other Amex
cards by Blue, this has been more than offset by the addition of new
relationships.
"American Express introduced a card with very attractive pricing, a unique
look and an internet related feature, the computer chip," says Brittain,
"and the combination seems likely to succeed on several levels."
The consumer study, involving more than 3,000 interviews both by telephone
and online, was conducted in March and April. Follow-up studies are
scheduled for September of this year and first quarter of 2001 when the Blue
card will be 18 months into its launch.
Brittain Associates is a full-service research firm specializing in
financial services.