{"id":18238,"date":"2014-07-06T07:56:45","date_gmt":"2014-07-06T05:56:45","guid":{"rendered":"http:\/\/www.w-t-w.org\/en\/?p=18238"},"modified":"2014-07-06T18:11:46","modified_gmt":"2014-07-06T16:11:46","slug":"american-express-gives-up-plastic","status":"publish","type":"post","link":"https:\/\/www.w-t-w.org\/en\/american-express-gives-up-plastic\/","title":{"rendered":"American Express Gives up Plastic?"},"content":{"rendered":"
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Leslie Berland has a curious job. She\u2019s paid to think about all the ways to make her company\u2019s flagship product obsolete.<\/p>\n

Berland leads digital partnerships and development at American Express, the company that pioneered the notion that a piece of colored plastic could not only buy stuff but raise your social status. In the future that Berland anticipates, a black card or a gold card won\u2019t mean any more than a purple card, because you won\u2019t have a card at all. Even American Express believes the plastic in our wallets eventually will go away.<\/p>\n

There are two things you always have with you: a credit card and a smartphone. The day is coming when we combine them.<\/div>\n

At a recent event, hosted by Andreessen-Horowitz, on the future of retail, Berland pointed out that there are two things you always have with you: a credit card and a smartphone. The day is coming when we combine them. \u201cWhat we are hyper-focused on is how do we merge those two things,\u201d she says. \u201cEspecially as one day the physical card will disappear.\u201d<\/p>\n

Berland is not alone in thinking plastic is on its way out. Figuring out how to make smartphones the primary way we pay for things is one of Silicon Valley\u2019s great white whales. The same minds that have put airline boarding passes on our phones alongside every song ever recorded and video calling a la The Jetsons<\/em> are trying to crack this problem. Everyone from Google and Apple to Square is pondering this.<\/p>\n

So far they\u2019ve had little success. But, ironically, this creates an opportunity for the very industry these tech giants are trying to disrupt. A company like American Express has every reason to want things to stay as they are. But if it\u2019s willing to concede its core product\u2019s days are numbered, it has a chance of beating the Apples and Googles of the world in the race to redefine payment tech. That\u2019s because it\u2019s got a key advantage over Silicon Valley: Amex already is in people\u2019s wallets.<\/p>\n

There are countless apps that already turn your phone into a credit card substitute: Google Wallet, PayPal, Venmo, LevelUp, Coin, Loop, and others abound, not to mention retailer-specific offerings like the Starbucks app. But with so many offerings, the offline merchants who still account for the vast majority of U.S. retail spending are reluctant to gamble on any one of them as the emerging standard. This hesitation creates a self-fulfilling loop in which consumers won\u2019t commit to an app because they don\u2019t know which stores use it. In the meantime, everyone just keeps swiping their cards.<\/p>\n

This puts American Express and other major credit card companies in a unique position to make mobile payments happen.<\/div>\n

As Berland describes it, this puts American Express and other major credit card companies in a unique position to make mobile payments happen. For them, the \u201cpoint-of-sale gap\u201d already is bridged.<\/p>\n

The various smartphone apps act as credit and debit card aggregators\u2014skins for what you already have in your wallet. That makes these companies what Berland calls \u201cfrenemies\u201d to companies like Amex. They encourage use, but they stand between card companies and their customers\u2014a concern for American Express especially, since, unlike MasterCard or Visa, it doesn\u2019t use banks as intermediaries. Amex\u2019s business depends on its customers embracing the concept of \u201cmembership,\u201d which the company reinforces through loyalty programs and other perks. These have the potential to get diluted when a different company\u2019s app stands in between Amex and its members. Also, those third parties get a piece of the customer data so valuable to AmEx.<\/p>\n

Ultimately, Berland believes the key to getting mobile payments to catch on won\u2019t be the technology but the experience it enables. Amex, Berland says, knows about its customers: what they buy, where they are, how they spend their money and time. Used the right way, she says, that data can be leveraged to make shopping more convenient and more fun. She acknowledges the danger of coming across as Big Brother. But she claims the company\u2019s own focus-group research has found this doesn\u2019t bother customers.<\/p>\n

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Leslie Berland has a curious job. She\u2019s paid to think about all the ways to make her company\u2019s flagship product obsolete. Berland leads digital partnerships and development at American Express, the company that pioneered the notion that a piece of … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":22,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"footnotes":""},"categories":[13],"tags":[],"class_list":["post-18238","post","type-post","status-publish","format-standard","hentry","category-finance"],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t