MARKETING MANAGEMENT

Case Study
Chase Sapphire: Creating a Millennial Cult Brand

Name: Sunil Kumar M

Reg no: 20202MDM0016
Section: G
Introduction
 Chase Sapphire Reserve Card launched in August 2016, by JP Morgan Chase
 Card sales exceeded its 12 month target in just 2 weeks
 50% customers were millennial who were posting photos of their Chase Sapphire
Reserve Cards through unboxing videos on YouTube & #Sapphire Reserve was trending
on Twitter
 100,000 point sign on bonus drove social media frenzy
 Gamered attention of prominent bloggers and affiliates as "a must have card in 2016"

US credit card market

There were five primary players in the credit card Industry:

 Issuers were banks that issued cards

 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

Sub Branding Chase Sapphire

 Chase proprietary card portfolio was sub branded to cater to five market segments
 JPMorgan to cater to private banking segment
 Chase Sapphire to affluent customers interested in travel 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
The Launch of the Chase Sapphire Reserve Card

 Product Design Strategy

 A new segment of ‘new affluent’ that were 25-44 years old with Income of $150,000+,
authentic travelers and savvy about rewards
 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

 Social Media Strategy

 Rather than investing in traditional advertising, they turned to media platforms and
influencers that were more pertinent to the affluent millennial consumers
 Engaged relevant influencers spreading the word within their communities 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

Result focused measurement framework

 REACH
The target audience comprises of young successful millennial’s, in the age of 25- 44
years

 POSITIONING
 During the launch, it sounded way too good to be true
 It is perceived as a high end, high fee, and high reward cord

 PREFERENCE
 "An AMEX says you are rich, but this says you are interesting"
 Millennial’s who are considered not pay a high fee for anything, would prefer to pay for
value

 ACTION
 The consumers responded by buying in large numbers
 12 months sales target was achieved in 2 weeks

Creating value from Chase Sapphire Reserve customers

 Challenges
 Dip in net revenue rate for card services
 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

Use of social media by Chase Sapphire

Promotions

"So You Can" campaign on Facebook

-- Reinforce card's value proposition

-- Driving small-ticket transactions. example: Bike rentals, food truck purchases

Instagram #Sapphire on Location and #Sapphire Six to showcase meal and travel experiences

Highlight special offers only available to top of the line card holders by working with celebrity
model Chrissy Teigan

Assessing Performance at Chase Sapphire

 Key Performance Indicators

 Business driven via social media

 Customer engagement score based on responses received
 Grievances resolved via social media channel
 Number of renewals
 Income Distribution
 Overall vs Target Segment Growth

 Diagnostic Metrics

 Number of likes, comments, shares and views

 Number of likes, comments, shares and views on competitor social media activity
 Changes in number of Customer complaints
 Complaint resolution time.
Managing Chase Sapphire Portfolio Going Forward
 Strong Brand Association for Chase Sapphire Brand
- Modern
- Contemporary
- 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