The women’s footwear retailer launched more than five years ago under Nordstrom’s off-price HauteLook brand.
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“Unlike other card issuers who are making the mistake of shying away from direct mail and focusing only on email contact, AmEx sees the importance of the two media,” he says. The bottom line is cardholders will get hit with the message from all angles.
Amex also spared no expense to launch and market the Blue card. Analysts’ estimates range from $25 million to $45 million, although AmEx officials have never provided cost details. Along with various print campaigns, Blue appeared in a handful of television commercials, promoting the card’s use online, pricing flexibility and general high-tech image. Blue ads also appeared on the video screens of some health club equipment while Rolling Stone and Entertainment Weekly ran ads with compact disks that link to the Blue web site.
Getting cardholder feedback also is helping AmEx develop Blue. Quigley says Blue cardholders have told AmEx the music and entertainment category is important. AmEx has been on the mark since day one: the card’s launch last year was bolstered by free concerts by Eric Clapton and Sheryl Crow. This summer, AmEx worked with outdoor concert venues, such as Chicago’s New World Theater, to offer a free CD from the concert artist to Blue cardholders who bought tickets online from Ticketmaster and paid with the Blue chip reader and ewallet.
While use of the chip itself is marginal, Quigley notes that there is a benefit to getting the chip application into circulation. “We could have done all this with just a mag-stripe but what makes the chip more secure is that it’s impossible to manipulate the card information,” he says. “It promotes security online.”
Although Quigley says cardholders do use the ewallet and corresponding chip card reader to buy online, some observers say getting cardholders to use the security features will be a challenge. Even though the concept of the ewallet is security as well as convenience, consumers are not catching on.
Brittain says the ewallet feature has not been a powerful driver of the Blue card. To say the least: while more than half of Blue cardholders buy online, the number who use the ewallet and reader is almost nil. Usage might go up, Brittain says, once cardholders discover the convenience of using the ewallet to fill out forms and if cardholders understood better why to use the reader.
But while the ewallet concept has yet to really take off, security is on the minds of consumers who do not yet shop online. According to CyberDialogue, 66% of those who are online but have not yet made a purchase believe it’s too easy for someone to steal card information over the Net. Those consumers may yet be attracted to Blue’s secure chip and ewallet features. John Almash, president of Stratcom, a marketing consulting firm, says at least AmEx is getting ready by establishing the technology and the customer base to use it.
AmEx says that, while it has a nice base of cardholders who may have been attracted to the card’s pricing, it will target consumers who are interested in the Internet and technology as well as being self reliant-essentially those who are likely to use computers and the web to perform such tasks as planning travel, shopping or managing their finances online. Clearly, AmEx’s entire web effort is focused on providing services and products for people who want to be able to go to one site to use tools that help organize their lives. Quigley says that while the Blue card has been slated for young technology-oriented people, AmEx views it more as a psychographic than a demographic. “Rather than looking at an age bracket, we think the card is very appealing to those who are young-minded,” he says.
Analysts say AmEx is attracting the right kind of customer for Blue and for online shopping. “AmEx’s Blue card is attracting the entrepreneurial individual for whom the card is designed,” says Almash. “The marketing also is in the right direction because it’s tailored to those who are inclined to shop online.” And he thinks AmEx is on target with the Blue card’s rewards program. “They have items such as electronics that people already are inclined to buy online,” he says. “Clearly they are customizing the rewards to the cardholders’ tastes and they have an impressive list of merchants.”
Almash adds that, from his experience consulting with retailers, online merchants will benefit from the Blue card’s promotion of online shopping. “Increasing sales is always the bottom line with retailers. Companies like AmEx are promoting online shopping to a customer base that the online retailer wants to target,” he says.
While AmEx Blue is still evolving as an online and offline shopping tool, it is well ahead of other card products. “What we really try to do is keep our finger on the pulse of the marketplace,” Quigley says. “Over the last few years, we saw the explosion in the use of the Internet and the use for e-commerce gathering steam, and we wanted to try to find a way to be relevant in this space.” With the reaction from consumers so far, the Blue card is making AmEx relevant and it’s bound to see blue skies from here. >
E-Wallets: A Work In Progress
Every once in a while, a technology comes along that actually makes things easier. To help consumers shop online more easily and securely, card associations and credit card issuers have started marketing online wallets. Slated to allow cardholders who sign up to save time online by using the wallet to automatically fill out order forms, which include shipping, billing and credit card information, the products seem to have a good theory behind them. In addition most ewallets are touted as security measures for Internet shopping, as card numbers are encrypted and protected within the wallet software. But are they being used?