American Express Scores Top in Customer Satisfaction
By Eva Norlyk Smith, Ph.D.
September 10, 2010
For the fourth year in a row, American Express is ranking highest in customer satisfaction, according to a recent study of credit card issuers released by information services provider J.D. Power and Associates.
On a 1,000 point scale, American Express earned a full 769 for customer satisfaction—55 points higher than the current industry average of 714 points. The study also showed that consumers’ overall satisfaction with credit cards is on the rise. Overall credit card satisfaction increased by 9 points from 705 last year, a three-year low.
The J.D. Power study was based on a sample of 8,500 cardholders, who were asked how satisfied they were with the terms, billing and payment processes, benefits and services, rewards and problem resolution of their credit card issuer.
Discover Card ranked second, scoring 757 on the customer satisfaction scale. The dubious honor of bottom ranking went to HSBC, whose cardholders gave the bank a meager 686 points customer satisfaction rating. Also ranking near the bottom was Citi Card, with 692 points, and Capital One with 699 points.
According to Michael Beird, director of banking services at J.D. Power and Associates, American Express may enjoy the high customer satisfaction ranking, because the company has mastered the art of effectively communicating the benefits, rewards and services that they get having an American Express card. Amex rewards cardholders tend to be very well-informed about the services and benefits of their cards in comparison to other rewards cardholders. In addition to effective marketing strategies, American Express offers premier customer service through its Greensboro call center with over 2,000 active employees. The card issuer also plans to construct a new, $600 million data center in eastern Guilford County.
American Express has long been a leader in the elite cardholder market, issuing exclusive credit cards targeting the most affluent segment of consumers. Amex is also one of the leading card issuers in the travel rewards credit card market with popular rewards cards like the Delta SkyMiles American Express can and the Starwood Preferred Guest Credit Card.
American Express has continued to do well in the profit department, despite the economic downturn of the past few years. By catering mainly to customers with good and excellent credit histories, the card issuer has managed to keep credit card losses low over past year, even as other credit card issuers have struggled with record credit card defaults. Last Thursday the company reported tripled earnings in its second quarter, and a net income of $1.02 billion.