President and CEO, American Express Canada
President and CEO, American Express Canada
Differentiating on service: The American Express Canada CEO is building a brand that's difficult for competitors to replicate.
From its stagecoach delivery system in the 1850s to the introduction of the traveler’s check in the 1890s, from the launch of the world’s first travel agency in the early 1900s to its financial services business and the introduction of its charge card in the late 1950s, the story of American Express is a story of adaptation.
However, throughout its 164-year history (and 161 years in Canada), one thing has remained constant, according to Howard Grosfield, president and CEO of American Express Canada.
“The concept of service has been front and center of every business that we’ve been in and one that’s allowed us to evolve, transform, and go where our customers want to go,” he said.
Howard (Toronto, Sydney, 1997-2004) joined American Express directly from BCG in a move he hadn’t anticipated. “I was very happy at BCG and wasn’t looking to leave—but an exceptional opportunity to join American Express came along and I figured I’d give it a try. It’s worked out very well,” he said.
Howard heads up the American Express Canadian executive team and manages the company’s Consumer Card and Small Business Services groups, leading the marketing, acquisition, product development, and insurance areas.
“Here in Canada, we have one of the world’s most consolidated financial service markets," he said. "Five banks control more than 80% of all retail banking relationships, so we need to be very strategic in how we invest and pursue opportunities that will create sustainable competitive advantages against such large competitors.”
As such, he adds, American Express’ vision is not to be the largest card company or the largest bank but, rather, to become the world’s most respected service brand. “With service at the center of everything we do," he said, "we come to work every day thinking very differently about ways in which we can design and build products.”
This is reflected in the suite of products—credit, personal, small business, corporate, and gift cards—available and in the array of rewards and benefits that cater to card members' needs.
“Differentiating your brand on service is something that takes years to perfect but when you get it right it is extremely difficult for your competitors to replicate,” said Howard, who wants customers to view their Amex Card as much more than just a commodity.
“We spend a great deal of time trying to make that flat, mundane piece of plastic in your wallet represent something more than just a payment tool. We want it to be emotional. We want it to represent membership and access to a niche set of services and experiences. It is this focus on service and experiences that allows us to be successful in the market.”
In many ways, it’s a differentiation that helped American Express Canada weather the recent global financial crisis. “The recession proved that a having a core focus on service is absolutely the right strategy,” Howard said.
American Express Canada has also revamped its approach to sponsorships, moving away from traditional models of naming rights for sports or concert venues, or, as Howard puts it “plastering our logo all over buildings and events.”
“Instead, we now take that money and reinvest it inside the venue to create a set of unique experiences for our customers,” he said.
As an example, Howard points to the American Express lounges that have been created within many of Toronto’s major concert halls and arenas. “We offer packages that might include, say, limousine service, dinner, priority check-in, cocktails in the lounge, and backstage passes to meet performers," he said. "We’re not just selling a ticket to a performance; we’re selling access and a complete experience.”
But how does a 164-year-old company that’s been around since before Canada became a nation create a roadmap for a future that is changing at breakneck speed? What does Howard see as being the next stage in the evolution of American Express?
“I would say that payments—with the convergence of payments online and on mobile phones—will go through more change in the next few years than they probably have over the last 30 years," he said. "While we don’t know exactly how this or any other changes are going to play out, we do know that we have to be ready to adapt. The primary compass we’re always going to rely on to navigate an uncertain future will be, as it always has been—service.”
Like any driver looking at the road ahead, Howard knows it’s important to check his rearview mirror once in a while. It has now been ten years since he made his “unanticipated” jump from BCG to American Express Canada.
It was a quick move, but was it a natural progression?
“Without a doubt,” said Howard.
“BCG is an incredible career training ground. It brings a set of traditional skills such as analytics, problem solving, exposure, and experience across multiple industries, and it teaches you how to think about and solve business problems, all of which are beneficial no matter what you go on to do.
“It is also a company filled with extraordinarily talented people with a wealth and variety of backgrounds and intellectual abilities and approaches not only to problem solving, but also to building relationships with each other and with clients. It’s where I learned about the softer skills around emotional intelligence, and how to think about the people side of a given problem as much as about the analytics and the math.
“BCG has been instrumental in helping me get where I am today. It set me up with a wonderful set of skills; it gave me confidence; and it contributed in a material way to the success I’ve enjoyed since leaving the firm. I left on the happiest of terms, and think fondly on the relationships I built there and that are still very strong today."
Howard is on the advisory board of the Pecaut Centre for Social Impact, a Toronto-based venture philanthropist that brings together high-potential charities, leading professional services firms—including BCG—and smart donors to create positive social impact. The Centre was created in 2012 in honor of the late David Pecaut, a senior partner in BCG’s Toronto office.
“David Pecaut played a significant role in creating the opportunity for me to join the firm and was an influence and inspiration during my time at BCG and throughout my career since. Being involved with the Pecaut Centre is an opportunity to help build a legacy to the contribution David made to his Toronto community.
“I hold David’s memory dear as the perfect example of how at BCG I was surrounded by the smartest, most capable, and most likeable people I have ever been exposed to in business.”