AmEx Reclaims Its Throne

It boosted points and added new benefits, then raised fees in the middle of a pandemic. The risky strategy worked

- Paula Dwyer

Inside the American Express Co. lounge at John F. Kennedy International Airport, the smell of success is in the air.

A bartender mixes drinks with ice cubes stamped 1850, the year AmEx was founded. Twentysomethings can be found draped over the lavish furniture, filming their next TikTok video and eating cuisine from a Michelin-starred chef. Wafting through the room is a specially crafted blend of bergamot, pink peppercorns, lavender and leather—the same concoction used in the scratch-and-sniff ads that helped rope in a record number of new Platinum cardholders this year. The lounges have become so popular in recent months that AmEx sometimes has to turn members away.

Just over two years ago, the company faced an existential crisis. It already had been losing customers to the likes of JPMorgan Chase & Co., but when Covid-19 hit and just about everyone curtailed traveling and dining out, the 172-year-old credit card giant was pushed to the brink.

What AmEx did next may be the marketing coup of the century. It revamped one of its most lucrative products, the Platinum card, by dangling hundreds of thousands of points before existing customers. It added a slew of non-travel benefits, from credits for Walmart Inc.’s Walmart+ subscription service to partnerships with luxury gyms. It sent thousands of flyers with the scratch-and-sniff panel to well-off millennial and Gen Z households, betting the signature scent would help lure younger customers. And then it had the nerve to raise its annual Platinum card fee in the middle of a pandemic.