Analysis of Competitive Environment in American Credit Card Market

This article analyzes the competitive environment in the American credit card market and its positive influences on JP Morgan Chase's credit card products. It discusses the market segmentation and product differentiation strategies employed by JP Morgan Chase, as well as the benefits of extensive market analysis in revenue generation and maintaining a high position in the competitive credit card market. The article also highlights the use of niche marketing and the marketing mix to target specific customer segments and generate high sales. Additionally, it explores how traditional and digital promotional techniques have enhanced customer awareness in the banking industry.

Running head: CREDIT CARDS
Credit Cards
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CREDIT CARDS
Answer 1:
The analysis of the competitive environment in the American credit card market had
positive influences on the new credit card product which JP Morgan Chase launched in the
United States of America. The first positive influence which analysis of the American credit card
market ushered on JP Morgan and Chase was that the banking company was able to introduce
five credit card products each targeting to fulfill the needs of the five different segments of credit
card customers. JPMorgan credit card targeted middle class customers while Chase Sapphire
credit targeted the upper class customer segments who preferred travelling and dining, thus using
credit cards to make these payments. The Chase Ink credit card targeted the small firms and the
Chase Freedom targeted the customers who wanted to save money in the forms of cash backs.
The Chase Slate credit card allowed customers to invest in the American financial market to earn
positive returns on investments (Creditcards.chase.com. 2019). This appropriate market
segmentation enabled the American multinational generate huge revenue in the forms of debts
obtained from credit card holders and interests on the late payments since credit is an asset
product. The second benefit which the Chase branded credit cards attributed to the American
multinational bank was product differentiation in comparison to the credit cards offered by its
competitor banks. Moreover, the bank offered the customers around the clock after sales services
which enabled the bank to boost customer satisfaction which prevented the competitor banks
from poaching its credit card customers. Thus, the third benefit which the extensive market
analysis attributed to JP Morgan Chase was perpetual revenue generation and high position in the
competitive credit card market of the United States of America (Mian and Sufi 2018).

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CREDIT CARDS
Answer 2:
Chase Sapphire focused on each element of the marketing mix to target specific customer
segments and generate high sales by using the technique of niche marketing. The five different
variants of the credit card which corresponds to the product component of the marketing mix of
the bank enabled the customers to derive specific benefits which added value to their purchase of
credit cards. For example, the Chase Ink card was designed to suit the limited financial resources
and power to spend of the small scale companies while the Chase Sapphire credit card enabled
the upper class consumers avail discounts (corresponded to the promotion component of the
marketing mix) on making payments of travelling and dining. The bank (place component of the
marketing mix) priced the credit cards keeping the financial strength of the target customer
segments (Ru and Schoar 2016). Thus, it is evident from the discussion that the marketing mix of
the credit card brand was able to cater to the specific needs of the different segments of the
clients of the bank, thus maximizing the value they generated on the usage of the credit cards and
consequently generated high sales both in terms of volume and revenue generated.
Answer 3:
The traditional and the digital promotional techniques have encouraged customer
awareness in several ways. For example, the digital banking portals enable customers to obtain
knowledge about the banking products and conduct financial transactions. Similarly, the
traditional promotional techniques like face to face customer interactions enable the banks to
understand the specific needs of the customers and offer appropriate financial products
(Nagurney 2015). Thus, it can be inferred that traditional and digital promotional techniques
have enhanced customer awareness by increasing the knowledge of the latter about the different
banking products aligned to their specific needs.

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CREDIT CARDS
References:
Creditcards.chase.com. 2019. Creditcards.chase.com. [online] Available at:
https://creditcards.chase.com/ [Accessed 23 Mar. 2019].
Mian, A. and Sufi, A., 2018. Finance and business cycles: the credit-driven household demand
channel. Journal of Economic Perspectives, 32(3), pp.31-58.
Nagurney, A., 2015. A multiproduct network economic model of cybercrime in financial
services. Service Science, 7(1), pp.70-81.
Ru, H. and Schoar, A., 2016. Do credit card companies screen for behavioral biases? (No.
w22360). National Bureau of Economic Research.