The American Express Mess
“Is everything okay with you folks?” were the words I wanted to hear or see. “You have been cardmembers for over 40 years and we are concerned.”
Never heard word one.
To quote my reader, Anthony Greene, “That really made me feel that American Express doesn’t give a damn.”
Greene’s e-letter made me remember the year 2004—my 40th anniversary as an American Express Cardmember. Like Greene, every time I used the card, I noted the line on the card, “Cardmember since 64.”
I wondered if American Express would write, phone or e-mail me a note thanking me for being a 40-year Cardmember and for spending what must be hundreds of thousands of dollars with them over four decades.
Like Greene, I received zip, zero, nada.
Then this past January 11, Robin Sidel wrote in The Wall Street Journal:
American Express Co., known for its creditworthy customer base, said that cardholder spending is slowing down and delinquencies are rising. As a result, the card company said yesterday that it would take a $440 million pretax charge against fourth-quarter earnings as it sets aside more money to cover soured loans. The company’s stock fell 6.9% in after-hours trading last night after the announcement.
Last Friday, American Express stock fell to $45.44, losing an additional 3.5% after reaching a 52-week low earlier in the week. AmEx CEO Ken Chenault is worrying.
“Now, Mr. Chenault—known for his focused demeanor that leaves little time for chitchat—must find ways to persuade people to keep pulling American Express cards out of their wallet,” continued Robin Sidel on January 26. “At the same time, he must reassure investors that the company’s recent period of prosperity hasn’t run its course.”
If Ken Chenault is sweating, what follows is some business common sense for him to think about.