American Express --- yet another negative comment here
On the weekend a discrepancy was noticed on the latest American Express bill received here. Calling the company mid-Monday morning, there was a recording that said, possibly paraphrasing, that "due to massive call volume I should call back tomorrow." TOMORROW? Not accepting that, I did call back later that afternoon and after a five minute wait reached a live human. Explaining that I had no idea what one unidentified charge was, I filed a dispute, and paid the remaining balance owed. Further examining the overall bill the next day and looking at the other family accounts included in my bill, it occurred to me that a charge listed under my name, attributed to my card, was actually a purchase by one of my daughters. It was legitimate but completely accounted for incorrectly. My daughters do not have access to my card, just my ability to pay. The Amex representative said that he had never seen such a thing happen. Can this be good?
To repeat what has been said in earlier posts, a great franchise has been taken for granted by current Amex management for too long and is now beginning to fray due to lack of newer and less bureaucratic management and possibly a lack of adequate technology investment relative to other firms. It seems that it is time for Chenault to leave, no matter how fine a person he may be.
Can my thoughts or experiences be unique? That's doubtful. AXP is a too powerful franchise to collapse and it is too widely held at significant capital gains exposure to be quickly sold. It will just linger and underperform like IBM, unless meaningful management change takes place and strategic lethargy ends. As an example of its stasis, look at the Expedia's, Priceline's and all the major travel sites now. Just 10 years ago that was Amex's game for the taking, and five years ago they could have emerged as a leading player. At this point, they are absolutely nowhere. They missed it.
The belief here is that the Costco deal was not successfully renegotiated because Costco, one of the best managed companies today as perceived here and by many influential investors, realized that American Express had under invested in technology and management talent, lacked vision, and was falling behind. Costco may not have wanted American Express as a partner, especially in an exclusive agreement. Here the belief at this point is that is almost certainly the case.