American Express Co. once again is branding its expertise. Earlier this month, the card company announced a new line of business called LoyaltyEdge that will work with strategic business partners to develop or enhance customer loyalty programs.
In a similar move late last year, AmEx created its Business Insights unit to provide merchants and other companies globally with analytics and consulting using its database on cardholder-spending activity.
“We have been thinking of ideas like this for a good amount of time and felt it was the right time to launch LoyaltyEdge,” says Lynne Biggar, AmEx senior vice president of rewards and loyalty. “We know from working with our partners that there is an increased interest in loyalty to help customers become loyal and remain loyal and to maximize dollars spent on maintaining those customers.”
LoyaltyEdge has the right experience, including skill set, contacts, mindset and success metrics, to help this work for others outside of AmEx’s current client base, she contends.
So far, LoyaltyEdge representatives at AmEx are in discussions with an undisclosed number of potential partners, says Biggar.
The biggest challenge and demand for loyalty programs is to differentiate them from others, and there is a trend toward providing a redemption process that allows users to use points all in one place, Biggar says.
“Where we fill a unique place is that we can provide more of a one-stop shop because we have the customer insight, the program design, as well as access to AmEx contacts to develop the breadth and depth of program offers and sophisticated targeting,” says Biggar.
Delta Air Lines, a longtime AmEx loyalty partner, is the first merchant to use the new loyalty service to boost its SkyMiles frequent-flyer program.
In a deal announced last week, AmEx is providing SkyMiles with the online SkyMiles Marketplace, an online portal where members can redeem points for hotel and car-rental bookings, appliances, personal electronics, sports and leisure apparel, luggage, handbags, jewelry and accessories. Evolving Delta’s loyalty program with Loyalty Edge was a natural fit because Delta has worked with AmEx since 1996 to develop its credit card products, according to a Delta spokesperson. Delta renewed its long-term partnership with AmEx in the spring of 2009, he says.
AmEx made a good move to highlight its loyalty business experience, one analyst believes.
“It’s a repackaging of the things they’ve always done for their partners, and it’s a great idea for them to brand it,” says Megan Bramlette, managing associate with Auriemma Consulting Group of Westbury, N.Y. “This is one more revenue stream for them to leverage their existing expertise and market it to companies outside their existing relationships.”
