American Express & J.P. Morgan Co.

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Presentation transcript:

American Express & J.P. Morgan Co. Dylan Anders, Joe Durkin, Anastasia Hadgigeorge, Lauren Recinella and Daniel Yergan

American Express Mission Statement “We work hard every day to make American Express the worlds most respected service brand.”

J.P. Morgan Mission Statement “At JPMorgan Chase, we want to be the best financial services company in the world. Because of our great heritage and excellent platform, we believe this is within our reach.”

Industry Analysis

Industry Analysis

Industry Analysis Industry represents 7.2% of GDP in 2015 Industry employed 6.08 million in 2015 Expected 12% increase in employment by 2018 High growth sector = substantial economic activity

Industry Analysis

Threat Of New Firms (Barriers to Entry) Low Many government regulations to open bank High amount of capital required

Bargaining Power Buyers Suppliers Medium Many alternatives in the industry More competitors Low/Medium Define products and services offered Costly to switch once heavily invested

Competition/Rivalry Citibank Discover Bank of America

Threat of Substitutes High Investment Industry: Commercial and investment banks Non-bank financial companies: Insurance firms, mutual funds, and market brokers Technology that meets basic investment needs

American Express Attractiveness 22nd most valuable brand – Business Week Top 20 most admired company – Fortune Diverse customers and geographics Profitability (through structure) Serves two-sided market Serves a diverse set of customer groups Consumers, small business and large corporations

J.P. Morgan Attractiveness Profitability (through structure) Ranked top 5 - America’s Ideal Employers Top 100 - Military Friendly Employers World’s Most Admired Companies Profitability (through structure) Multiple segments such as banking & asset management Central Objectives Clearly communicating and enforcing corporate standards Enhancing board and management structures

Strategic Analysis

American Express Differentiation strategy Focuses on spending rather than transactions 107 million cards and 6 billion transactions Issues cards through its banking subsidiaries Employs a closed-loop network American Express Bank

How Did American Express Strategically Position Themselves Targets customers likely to spend more Able to bypass issuers and inquirers This means larger revenue for the firm Offers rewards and incentives Place high priority on customer relationships Delinquency rate is only 1.07%

J.P. Morgan Differentiation Strategy Focus more on brand identity Emphasizes trust and loyalty Five forces model Merged commercial banking and investment banking #1 in customer service since 2012 – ACSI

Financial Analysis

Work Cited http://ir.americanexpress.com/cache/1001217576.pdf?o=pdf&t=&y=&d=&fid=10 01217576&iid=102700 http://csimarket.com/stocks/axp-annual-return-on-investment-roi.html https://revenuesandprofits.com/how-american-express-makes-money/ http://csimarket.com/stocks/profitability.php?code=axp https://www.forbes.com/sites/greatspeculations/2014/03/13/how-americanexpress-gains-a-competitive-advantage-from-its-closed-loop- network/#debe5cd4be71

Work Cited http://www.investopedia.com/articles/personal-finance/031915/jpmorgan-vs- goldman-sachs-jpm-gs.asp https://am.jpmorgan.com/us/en/asset-management/gim/adv/insights/weekly- strategy-report https://www.jpmorganchase.com/corporate/about-jpmc/ab-awards.html https://www2.deloitte.com/us/en/pages/financial-services/articles/banking- industry-outlook.html http://www.ibanknet.com/scripts/callreports/filist.aspx?type=fry9