American Express (AXP-3.12%) has done its best in dining to attract a younger clientele. Today, Millennials and Gen Z are among the company’s most loyal cardholders.
When Amex began expanding into the restaurant and event field, Reservation platform Resy In 2019, we began revamping our services. In July, Added luxury options We acquired premium booking platform Tock and mobile payments company Rooam.
This business model is paying off, especially with young people, the company said in a report. 3rd quarter Friday’s results. In the three months ending September 30, 80% of new Gold Card accounts were opened by Millennials and Gen Z. The card also had a 30% higher utilization rate than the company’s Platinum Card.
“The strong early results from our product innovations strengthen our value proposition and help us meet the financial and lifestyle needs of our customers,” Chief Executive Officer Stephen Squery said in the earnings call. “It strengthens our confidence that we are investing in the right areas.” release.
The company said new Millennial and Gen Z customers are more loyal to their AmEx cards than older generations and have higher customer retention rates.
Amex announced refreshed gold card This July includes new dining credits for purchases at Resy restaurants and Dunkin’ in the US. The annual fee for this card is $325 and you get 4x points on dining and grocery shopping and 3x points on travel.
The company says Millennials and Gen Z use their cards for meals nearly twice as often as other cardholders, including making a higher percentage of reservations through Resy than other generations. .
Overall, the business growth rate claimed by Millennials and Gen Z increased by 12%, the highest of all generations (though still a 1 percentage point slowdown from the previous quarter). This indicator refers to the trading volume of payment products issued by Amex.
Squery said the company views its strategy to attract younger cardholders as a long-term investment.
“These are groups that will continue to grow with us, and over time we will see organic spend increase and eventually upgrade from green to gold, gold to platinum, etc.,” the CEO said. . “And, again, I think we’re really laying the foundation with the investments that we’re making for strong growth going forward.”
Amex stock fell 5% on Friday morning after the company slightly missed analysts’ overall sales expectations. The company reported record sales of $16.6 billion for the quarter, up 8% year-over-year.
