Can Plenti Help Amex’s Customer Base Become More Plentiful?

It has been an interesting year to be American Express. The downsides of interesting — namely the end of its relationship with the nation’s second largest retailer Costco followed shortly thereafter by a similar break-up with JetBlue — have been well documented and rather extensively discussed.

What gets somewhat less airplay is Amex’s move in the last year or so to expand its brand past its traditional affluent and corporate users. In a March 2015 speech at Boston College’s Carroll School of Management, Amex CEO Ken Chenault told a crowd of high-profile Boston area executives “[in the ’80s and ’90s, Amex] gained a reputation as being prestigious, elitist and expensive – and for years we reveled in those attributes. We took our prestige so seriously that as a company, we too became elitist and arrogant.”

But the Amex of the 2000s is bent on change – and has been consistently working toward making membership more appealing to average consumers, and acceptance more appetizing for merchants.

“We’re excited about broadening the reach of the brand,” Chenault noted to investors during Amex’s Q1 earnings call two weeks ago.

And recently it seems Amex is pushing forward on that expansion goal. In late 2014, it entered a partnership with McDonald’s that lets customers use their points to buy Big Macs and fries, as opposed to the perhaps more conventional airline tickets and yoga mats. The firm has also pushed forward with its reloadable prepaid products such as BlueBird and Serve, both of which are pitched toward the unbanked and underbanked markets.

As May 2015 opens, Amex has rolled out its latest expansion initiative — albeit one Chenault previewed during the the Q1 earnings call.

Amex’s new loyalty program – called Plenti – will allow U.S. consumers to earn and spend points at a variety of merchants, no matter how they choose to pay. PYMNTS caught up with Abeer Bhatia, chief executive of U.S. Loyalty at American Express, shortly after the program was officially kicked off. Bhatia spoke excitedly about the launch – and was particularly animated at its prospects for introducing a new set of customers to Amex’s take on loyalty and rewards.

“One of the things we at American Express want to do is become a much more welcoming brand that appeals to a broader segments and this allows us to do that,” Bhatia said. “We can provide a great product to a wide range of consumers that appeals to them. And I think by not linking it to a card per se, it allows us to reach out to a much broader set of consumers. That’s really what this is about –  appealing to the largest base possible.”

Bhatia noted that the program was open to any consumer – Amex member or not – and noted it can be combined with any conceivable payment method.

“It is what we call tender agnostic, so you can pay anyway you want – a credit card, a debit card, a check, or even cash there is really no limitation,” he said.

Because flexibility is essentially what the program is aiming for – and simplicity. Consumers aren’t offered specific deals or percentage discounts based on purchase type; instead, consumers just rack up Plenti points. Points are redeemed in thousand point amounts at a rate of $10 per a thousand. And those points are transferable between all Plenti merchants.

“At its core, Plenti allows consumers to shop at one of our partners and allows them to earn Plenti points at those partners,” Bhatia noted. “From there they can decide whether they want to redeem those points at the same partner, or at any of the other partners in the network. For example, you can go buy things at Rite Aid, earn points and go and use those points at a Macy’s or Exxon.”

Among participating retailers at launch are Macy’s, Rite Aid, ExxonMobil, AT&T, Wegmans, Food Lion, Harris-Teeter and ShopRite. Bhatia noted that they are in talks with merchants now to expand the program, as retailers are increasingly looking for rewards programs that are simpler and more effective in actually building customer habits

“I think a lot of our partners really wanted to provide a loyalty program that stands out in the marketplace that is different,” Bhatia said. “Something like this really didn’t exist in this scale and this shape in the United States. They found this appealing as something they can truly provide a different experience for the consumers and the flexibility of gaining points one place and use them in another place.”

Bhatia also noted that though the points are easily transferable among retailers – merchant partners are given a fair amount of flexibility about how they want to award points within their own store.

“Every merchant determines how many points you get per dollar you spend in the store,” he added. “Of course we discuss it with the merchants to make sure it is sensible but by and large every merchant determines almost entirely on their own.”

Plenti officially kicked off earlier this week, and consumers have two options for signing up. They can either visit the website and create an account online — and a plastic card will arrive in the mail. Plenti customers can also sign up in store, but the registration must be completed online.

“We think this can really add a lot of value for consumers,” Bhatia noted. “Our whole hope is that consumers go, sign up and then really enjoy the program.”