New AMEX Rewards Card Targets Small Businesses in Canada
Souccar, Miriam Kreinin, American Banker
American Express Co. has introduced a frequent flier card for small businesses in Canada.
The company says its Air Miles Gold Business card is the first pointsbased loyalty card for Canadian entrepreneurs. It is available only in that country.
The product is a commercial counterpart to the consumer Air Miles card that Amex Canada Inc., the New York company's Toronto subsidiary, introduced 18 months ago as part of a market-share push in the country.
Air Miles for consumers, a revolving credit card that lets cardmembers accumulate points toward free travel and other rewards, is the most successful card that the company has introduced in Canada, said David Barnes, a spokesman for Amex Canada.
By offering only a charge card, American Express was "appealing to a narrow section of the marketplace," Mr. Barnes said. "We realized we had to broaden to reach more people."
In four years, the number of American Express cards in circulation in Canada has risen by 800,000, to 1.8 million, Mr. Barnes said.
A survey of 300 small businesses, commissioned by American Express, showed that Canadian entrepreneurs like the concept of a card with loyalty points. The cobranded card is issued by Amex Bank of Canada in partnership with Loyalty Group, a Toronto-based rewards company.
American Express and Bank of Montreal have marketing agreements with Loyalty Group's Air Miles for Business program. They and other card issuers are sharpening their focus on Canada's two million to three million small businesses.
"Small business is the highest growth area in Canada right now," said Wendy Li, marketing manager at Bank of Montreal. "Two to three years ago there weren't any card products designed for small businesses here. Now most banks have something."
Debra L. Ambrose, director of product development at Amex Canada, said more and more entrepreneurs "are using credit cards in place of traditional loans to finance their companies, and many business purchases are made on personal cards in order to accumulate points."
More than half the small-business owners surveyed said they worked at least 60 hours a week. …