SharkJumping

Bid for My Credit Card Business - An Amex Case Study

I've been heads down riding the explosive growth of MeezNation since it launched, so I haven't had time to blog recently, but it was time to get back to it. 

A business always has to consider what it will do to retain its top customers.  In many cases, the firm focuses too much on attracting new customers with better deals rather than retaining its best current customers - e.g. I routinely receive Comcast notices at my house offering a better deal to new customers than the one I currently have with them.   So what customers naturally should do is periodically look at their vendor relationships to see if they can get a better deal, like what we all do each year when our cable bill goes up and we threaten to leave.

This has recently happened to me with our Meez credit/charge card vendor, American Express.  I opened an OPEN account when Meez started.   It's a small business focused-account which is personally guaranteed by me, and we charge almost everything at Meez through it.  Over 3 years, this number has grown each month to where we now charge more than $100,000 a month on it, we always pay on time (since I'm guaranteeing it), and we never call customer service.

However, the issue I recently encountered is a lack of customer segmentation by American Express - basically, we receive no additional benefits beyond what a person who charged $1,000 a month would get.  The service isn't bad - it's just that Amex is probably booking $35K a year in charge fees, and they have literally no extra costs from our account vs a smaller one - it's all margin.  For a small business account, we're probably in the top 5-10% of their users.  The PLUM card gives us 2% back if we pay in 10 days, but again, I get no extra value for my additional charge volume, meaning my guess is there are other vendors who might want to compete for our business.

So I called their customer service group, whom i have never spoken with, and made my case to them.  The good news is that they're being responsive to my threat to leave, and a very pleasant and smart woman has repeatedly insisted that Amex provides enough value that I should essentially be happy with the service.   The bad news is that they apparently have no way to value my business in a way that's meaningful for me.

So here is my proposal to anyone in the credit card/financial services field reading this blog:  make me an offer to take over the Meez credit card business - clearly it has to involve some type of benefits to Meez which are substantially above what other smaller customers receive, but I leave it open to each company to decide what that deal is.  I'm happy to provide past financial statements to make my case.

And American Express?  Well I admire their confidence in their overall service offering that they don't feel the need to do anything substantial to retain our business, but I'm not sure that losing my entire account over this confidence is a good move.  However, every business makes this call - what should we do to retain top customers?

Xbox 360 Announces Fall Avatar Upgrade

I'm not at E3 for the first time in 11 years due to work/family obligations, but it was good to see Microsoft announce the long rumored Avatar-feature set for XBox Live, due this Fall as part of a big XBLA upgrade.  While it's unclear exactly what it will entail, it seems that avatars will be a key part of the expanded XBox Live Community feature, just as it is for Nintendo Wii/Mii, and for the long awaited Sony Playstation 3 Home service.

What we've seen across all of the big interactive, entertainment sectors is that an avatar will become a required part of every personal profile, whether it's social media like MySpace, gaming like XBox, blogging like Blogger, or IM like AOL Instant Messenger.  The future goal is to carry your identity avatar from platform to platform as we do with Meez, but it's clear, at minimum, that many users of all ages will create and customize animated versions of themselves for each community versus uploading pictures of themselves, which can be too personal, and sometimes, too racy for the site itself.

The next step in personalization, as Nintendo has implemented in a limited fashion, is to integrate the  avatars into the games themselves versus just having them represent the community.  The best example is the Wii Sports Tennis game, where a player can integrate their Mii avatar into the actual match, or the We Ski program where your Mii can ski the course in the game.  It' s not appropriate for the majority of hard core games since you wouldn't want an avatar in a Lakers jersey wandering around Call of Duty 4, but it's great for a set of casual or modern games like Wii Sports or Diner Dash.

At Meez, we obviously believe quite highly in this approach since we recently announced a joint promotion with FlashGameLicense.com to offer over $20,000 in prize money to talented 3rd party game developers which integrate a Meez avatar into their new games, just as we have done on a trial basis with Dance Floor Destroyer and Bar Room Blitz, two of our top 5 games every day, even though they are some of our oldest games in the portfolio.

The move towards personalization of the gaming and community experience is an inevitable one, whether it's console, PC, casual or web gaming.   The console platforms like Xbox 360 are leading the charge, but the rest of us are all driving the avatar personalization concept into a far broader gaming market, and we will all end up with avatars representing us in gaming communities in 2009.