You are on page 1of 14

Chase Sapphire: Creating a

Millenial Cult Brand

Shruti Surana(I062) Arushi Jain(I026) Paavan Maniar(I039)


Mayank Lakhotia (I036) Ayushi Srivastava(I061)
2

• Chase Sapphire Reserve Card launched in August 2016,

by JP Morgan Chase

Introduction • Card sales exceeded its 12 month target in just 2 weeks


• 50% customers were millennials who were posting photos
of their Chase Sapphire Reserve Cards through unboxing
videos on YouTube & #SapphireReserve was trending on
Twitter
• 100,000 point sign on bonus drove social media frenzy
• Garnered attention of prominent bloggers and affiliates
as “a must have card in 2016”
3

• There were five primary players in the credit card industry:


Issuers were banks that issued cards
US credit card market Cardholders paid charges and fee
Merchants accept credit card payments
Merchant Acquirers managed relations with merchants
Network Providers processed payments
• The credit card industry was led by JP Morgan Chase, it had a market
share of 21.7%
• American consumers held 636 million cards. On an average a consumer
held 2.35 cards
4

• Chase proprietary card portfolio was sub branded to cater to


five market segments
Sub Branding • JPMorgan to cater to private banking segment
• Chase Sapphire to affluent customers interested in travel and
Chase Sapphire
dining
• Chase Ink to cater to small business
• Chase Freedom to cater to consumers interested in cash back
• Chase Slate to cater to consumers interested in building financial
responsibility
• Sub branding was done to speak directly to each target customer
segment
• Chase Sapphire was the rewards card introduced for high end
consumers with practical features.
• Chase launched Ultimate Rewards program with supporting IT
infrastructure
• All Chase Sapphire calls were answered by live advisors
5

Product Design Strategy


The Launch of the • A new segment of ‘new affluents’ that were 25-44 years old with
Chase Sapphire income of $150,000+, authentic travelers and savvy about
rewards
Reserve Card
• Construct a value proposition comprised of the optimal mix of
rewards, benefits, services, experience, interest rates and annual
fees
• The motive to remain top of wallet for long term and to reduce the
count of “churners”
• The card was presented as a flexible product that allowed
consumers to set their own rules – providing convenience, relevance
and choice

Market Response
• The Points guy quoted ‘it sounded way too good to be true’
• Fueled by social media and online forums, news about the card
spread quickly to ‘points junkies’
• The annual acquisition goal was reached in just 2 weeks
6 Social Media Strategy
• Rather than investing in traditional advertising, they turned to media
platforms and influencers that were more pertinent to the affluent
The Launch of the millennial consumers
Chase Sapphire • Engaged relevant influencers spreading the word within their communities
Reserve Card • Partnering with TV personalities, producer/directors, comedians,
photographers, food & travel creator
• The celebrities shared their experience through 20 unique, highly
engaging social content delivered to millions of followers
• Hosted media events, advertised with online video content (VOX media)
• Created the sense of limited availability, to give a feel of exclusiveness

Multi channel social media strategy


• Sapphire six: tapped anonymized spend data of reserve card members
to cover frequently visited dine outs; to promote they offered 3x points
on dining benefits
• #SapphireOnLocation to showcase exciting meal and travel experiences
• Innovations: used Instagram and Facebook to demonstrate tips and tricks
- automating bill pay using chase mobile app
• Dedicated social media team tasked with humanizing the brand
• Real time engagements
7 POSITIONING
REACH

• During the launch, it sounded way


Result focussed too good to be true
measurement • It is perceived as a high end, high
fee, high reward card
framework

PREFERENCE
The target audience • “An AMEX says you are rich, but this
comprises of young says you are interesting”
successful millennials, in • Millennials who are considered not
the age bracket of 25- pay a high fee for anything, would
44 years prefer to pay for value

ACTION

• The consumers responded by


buying in large numbers
• 12 months sales target was
achieved in 2 weeks
8

Challenges
Creating value from
Chase Sapphire Reserve • Dip in net revenue rate for card services
customers • Will Reserve customers renew their accounts?
• Low barriers to switching credit cards

Objective
• Provide superior value to consumers along with managing
the economics of the program

Solution
• Rewards are enough to generate loyalty – Lorraine
Hansen, Head of Ultimate Rewards
Promotions
9
• “So You Can” campaign on Facebook
-- Reinforce card’s value proposition
-- Driving small-ticket transactions eg. Bike rentals, food
truck purchases
Use of social media by • Instagram - #SapphireOnLocation and #SapphireSix to showcase
Chase Sapphire meal and travel experiences
• Highlight special offers only available to top of the line card
holders by working with celebrity model Chrissy Teigan
10

Assessing Performance
at Chase Sapphire Key •Business driven via social media
•Customer engagement score based on responses
Performance received
•Grievances resolved via social media channel
Indicators •Number of renewals
Alignment to brand’s •Income Distribution
business objectives •Overall vs Target Segment Growth

Diagnostic •Number of likes, comments, shares and views


•Number of likes, comments, shares and views on
Metrics competitor social media activity
Metrics used to identify the •Changes in number of Customer complaints
changes needed to be •Complaint resolution time
made to improve KPIs
11
Benefits
• Cost savings on offline advertisement
• Customer loyalty
• Increased FCR (dedicated customer
service)
Risk

ROI for collaboration 1. Multiple


Costs
customer service
• People – collaborators, celebrities,
goals Total
influencers
2. Attracts
• Process – design campaigns Economic
influencers
• Technology – payment platforms Impact
3. Users access
to social media
Flexibility
• Create stronger brand association
• Avoid product cannibalisation
(Preferred vs Reserve)
• Product innovations

ROI
Operational ROI Productivity ROI Strategic ROI
12

Way Forward
13

• Strong Brand Association for Chase Sapphire Brand


Managing Chase - Modern
Sapphire Portfolio - Contemporary
Going Forward - Tailored for travelers
- Generation Gap

• Customers with right expectations and getting them fulfilled

• Focus on increasing Early Months on Book Consumers to get the


customers hooked and build affinity

• Accommodate and differentiate Preferred and Reserve


categories

• Additional Product Innovations for the Sapphire portfolio


Thank You

14