Global Marketing Plan for American Express: Bahrain

David Capps

The University of Arizona Global Campus

BUS622: Global Marketing (FTB2102A)

Dr. Ray Powers

February 15, 2021

 
 The Mentor Company

As a critical player in the global financial markets, American Express has succeeded

globally in the broader general arena. A company from which other companies could quickly

build their strategies. The following is a brief analysis of the company's current environment on

the global stage.

Executive Summary

The American Express Global Marketing plan is a springboard by which the company

can maintain, sustain and expand operations globally. Having been in-place in Bahrain for many

years, it is the ideal location to be front and center in managing the campaign related to the

middle east. With unprecedented and exciting changes happening in the Middle East, a well-

placed American Express will reap the benefits of the many years of hard work already invested

in the region.

With an already highly developed internet and social media presence alongside the

growing acceptance of the internet in the region, social media will play a crucial part in the

campaign. Given the significant changes in the socio-economic climate of recent years,

American Express would best serve its stakeholders with a continued presence in the region,

even in light of continued social unrest. With the short and mid-term prospects bright, further

development of strategy is warranted considering Bahrain's growing financial markets and the

regions and improvements in cross-border payment scenarios.

A globally cohesive payments company, American Express (AE) provides customers

with access to financial payments products. AE works to ensure access to comprehensions and

encounters that improve and build customer success. As stated by AE, "…is a leader in providing

credit and charge cards to consumers, small businesses, mid-sized companies, and large

corporations" worldwide (American Express Staff, 2019).

Economic

AE 2019 results show that their investment strategy is working. AE revenue achieved a

record of $43.6 billion. AE's fourth quarter of 2019 marked their 10th consecutive quarter of

adjusted revenue growth at/or above 8 percent. Globally, spending was up 5 percent from the

previous year and exceeded USD 1.2trillion (American Express Staff, 2019).

Trade

As related by Verhange, with a $92 billion market value, AE is the leading issuer of

commercial cards globally and has connections with most of the Fortune Global 500 (Verhange,

Surane, & Bloomberg, 2020).

Social and Cultural

AE positions itself and a socially responsible company, with multiple programs detailed

in the Environmental, Social, and Governance Report (American Express Staff, 2019-2020). One

example is the Serve2Gether volunteer program. More than 30,000 volunteer opportunities are
provided during 2019 to colleagues across fifteen countries. The AE staff's opportunities to 'give-

back' to the communities where they work were changed in 2020 to ensure healthcare workers

had places to stay and meals to eat during the COVID pandemic (American Express Staff, 2019-

2020).

Political, Legal, and Regulatory

AE competes in the Financial Services Industry, a highly regulated industry. As AE

stretches its reach into more global markets, a constant roadblock is a disparity in financial

regulations, policies, and procedures in the different countries and cultures where it competes.

AE does collaborate within the effort to reduce such disparity. One such effort is the Global

Financial Innovation Network, a coalition of financial regulators from ten countries working to

find solutions to cross-border payment services issues (Mike Faden, 2020).

Parametric Analysis

A region steeped in societal and religious tradition, the Middle East has begun to push

harder to become more modernized in an age where technology is king. As the middle eastern

consumer begins to accept the internet and become comfortable with technology, three key

things have risen to the top[ CITATION Abd19 \l 1033 ].

First, brand loyalty is diminishing. As consumers begin to shop in a more educated way,

they are less likely to buy based on brand. Instead, they are looking for more satisfaction in their

purchase, mainly purchasing at a lower cost[ CITATION Abd19 \l 1033 ].

consumers are worried about their situation. A growing number are concerned with

unemployment prospects[ CITATION Abd19 \l 1033 ].

Third, the desire for locally sourced products is growing. Especially among the younger

consumer, the desire for locally sourced products, especially in foodstuffs, is causing many

larger food distribution operations to see stagnant or reduced margins[ CITATION Abd19 \l

1033 ].

General Strategy

With operations firmly established in Bahrain, AE would need to consider the current

situation and determine whether to continue existing operations, scale-up, scale down or

terminate. The following information provides a broad overview of the country's business

climate in light of various categories.

Demographic

AE has been in business in the Middle East since 1959. In 1977 the AE Office was set up

in Bahrain 1977. AE has continued in the area in the form of a joint venture with Mawarid

Investment Limited since 1992. The joint venture employs five hundred plus workers in a

diversified workforce (Nest, 2018). The 'island' or archipelago nation is small at approximately

239 sq miles; The country does produce small amounts of oil. The government is a constitutional

monarchy. The al-Khalifah family, who has ruled since the 1700s, in 1961 was resolved to

diversify his kingdom's economy and set about showing Bahrain as a major financial center

(Mother Earth travel, N.D.).

According to the World Sourcebook (CIA, 2020), oil and natural gas play a dominant

role in Bahrain's economy. Despite this, Bahrain has established itself as a regional finance

center with many firms from both inland and offshore owners as part of its diversification efforts

(CIA, 2020).

Trade

In the past several years, Bahrain has successfully changed the outlook for the country.

In part due to more liberal economic policies. Bahrain's economy continued growth in 2018 with

a real GDP rate estimated at %1.8. The manufacturing industries and the financial sector have

achieved %2.5 growth rate during 2018 (Bahrain, 2020).

-Chief exports have remained oil and natural gas, aluminum, and financial services.

-Chief imports continue to be crude oil for refining, natural gas for energy production in support

of the manufacturing industries (Mother Earth travel, N.D.).

Cultural and Social factors

Enormous differences in regional religion, politics, and culture remain despite years of

progress in some sub-regions and categories. Civil unrest remains in the country, mainly due to

the disputes between the ruling minority (Sunni Muslims) and the majority population (Shi'a

Muslims). Despite efforts to keep the peace, recent troubles have surfaced to remind the country

there are remaining issues (Mother Earth travel, N.D.).

In 2001, the USA and Bahrain entered into The U.S.-Bahrain Bilateral Investment Treaty

(BIT). The BIT requires advantages and protection afforded to U.S. companies in Bahrain. A key

aspect of BIT is the expectation of making financial transfers freely. Access to international

arbitration is another aspect of BIT that benefits when working in a foreign market such as

Bahrain (Gary Schumann, U.S. Dept. of State, 2017).

Political Factors

Despite the changes made by the Khalifa regime, social turmoil will remain to be a risk.

However, the ruling family remains in power, and Bahrain's allies in the Gulf region support

them. The Shi'a community, which forms most of the population, complains about restricted

representation in parliament. Tensions were elevated before the political crisis ten years ago

amongst the Shi'a opposition and the Sunni-dominated government (Coface Staff, 2020).

Tensions remain high, as evidenced by recent civil unrest in 2019. The introduction of

measures in programs such as voluntary retirement schemes and cuts to water and electricity

financial aid is challenging measures that anger the opposition and add to the risk of unrest. A

positive step for Bahrain is establishing a new bankruptcy law in 2018 to improve its business

atmosphere (Coface Staff, 2020).

Part 1: Integrated Marketing Communication Strategies (IMC)

In analyzing my mentor company's advertising campaigns, American Express, I found

several possible choices for this assignment. Eventually, the choice to review the Integrated

Marketing Communication(IMC) in the ShopSmall campaign. The focus of the campaign is to

nationalized in 2018[ CITATION Dan20 \l 1033 ]. Finding many examples of the campaign's

media online and references to print media used in the campaign, no examples of the printed

media surfaced online.

Beginning my search at the Moat.com website, searching on the name American Express,

returned 15,665 creatives. Too many to review individually. In the ones that did get a review, all

appeared to be targeted ads for desktop applications. All of the ads displayed presented the name

American Express. Most of the ads displayed an image of the company's chief product, a credit

card. There were a variety of shapes and sizes. The predominant color was blue, an American

Express primary characteristic. Many of the ads display the shape of ads typically found on

webpages - where ads are typically displayed in the margins or floating above the

page[ CITATION Moa21 \l 1033 ].

Continuing my search for ad campaign media, video's surfaced next. Looking around the

American Express YouTube channel, there are many examples of video media used in

advertising. There were many categories of videos, from educational to amusing. The videos'

most common aspects were displaying the company blue logo, which displays a contracted

name, or just the initial 'AMEX' and the blue color. Some displayed an image of a credit card

outline most did not. Several countries were represented in the videos, including Hong Kong and

Singapore. Each video focused on a single subject.

Television ads were very similar in construction as the YouTube videos, and it would not

be hard to assume the videos were made with an eye towards broadcast. Given the length of

many of the videos at @:30 seconds, this is an easy assumption to make. The videos and TV ads

are so similar, even amongst different ad campaigns, they are difficult to tell apart.
 At first, examples of billboards in the ShopSmall campaign also seemed hard to find.

Locating two examples, it became apparent; they carried the characteristics common to an

American Express ad campaign, the blue color, and the logo. Between the examples, both had

pictures and information of a small business. Each had the logo 'Shop Small Today.' The small

business' product is also worked into the advertisement as well.

Of the ads identified as being part of the 'Shop Small' campaign, there were several

characteristics that not only identified them as an American Express ad but tied them into the

campaign message as well. The first is the logo and blue color; while arguably not components

of the campaign, the color is associated with a well-known company and attracts your attention.

Second is they share a message that is commonplace amongst all the different media types. Shop

Small. Support small businesses not only in the United States but in other countries as well. By

showing the small business owner in the ads, personalization softens the big company's feel and

personalizes the consumers' experience[ CITATION Kee19 \l 1033 ].

With this being a multi-year campaign, repetitiveness is also a factor. In the case of the

campaign, the repetitiveness is both good and bad. It is 'good' in that the message is continuous,

familiar, and expressed. It is 'bad' in the sense that it can become stale, too familiar, tired. One

aspect not apparent to consumers is the revenue-generating activity relative to the campaign's

overt charitable face. By appearing to offer support and partnership with the small business' of

the world, American Express is driving revenue into their coffers (as well as the small business).

They go a step farther and bring the consumer into the mix by providing cashback incentives to

the consumers who use American Express cards to do the shopping[ CITATION Dan20 \l

1033 ].
 Twitter tweets were more diverse than any other ads; however, that is only a small

difference. Many of the same attributes applied to the tweets as they did to the ads. Colors, logos,

and company names. Given the nature of tweets on Twitter, there was more text. The text was

more localized and in a specific fashion than the ads. The subject matter was varied as well,

trying to be relevant to current topics. The tweets also tried to be more socially relevant in the

here and now sense.

Part 2: Global Brands, Cultures and Advertisement

Selecting two videos from the YouTube library, one is with e subject on Singapore and

the other Hong Kong. The ads are advertising the American Express Platinum card. The ads

appeal to slightly different aspects of the culture of the target audience, using localization

practices. By also using language and phrasing, the ads are customized to the local cultures.

Localization appeals more to me. The targeting of specific attributes, while more complicated,

does provide a more welcome message. Standardization, which will be less complicated and

more comfortable with producing the ads, also comes across as generic and harsh. The Honk

Kong ad focused on snob appeal by showing what the character can have if he could get the card.

The Singapore ad focused more on a Rational Appeal by explaining how useful the card could be

if the character had one.

Conclusion

Given the significant changes in the socio-economic climate of recent years, even in light

of continued social unrest, A.E. would, and a continued presence in the region would best serve

its stakeholders. With established partnerships and assets already in place in Bahrain, little

downsizing should occur due to this analysis. With the short and mid-term prospects bright,
further development of strategy is warranted considering Bahrain's growing financial markets

and the regions and improvements in cross-border payment scenarios. In expectation of reduced

petrochemical resources occurring in the 10 to 50-year timeframe, long-term planning should

consider the market changes as impacted by the reduction in the payment-making ability of those

heavily affected.

With growing access to the middle eastern, north African market and decreased entry

barriers in that market, other competition will show up looking to reduce AE market share for

their gain. AE will be well served by maintaining observations of those growing threats and

adjusting strategies accordingly.  

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