American Express: Making marketing music
By Staff -- Purchasing, 1/14/1999 7:00:00 AM
With a degree in musical composition and a career in operations and procurement, Joseph A. Yacura, senior vice president of global procurement for American Express, has never thought of himself as an entrepreneur. Then again, he's not boxed in by labels either.
That's why when the opportunity arose to pitch a new idea to leverage his group's procurement skills to external customers, he leapt. In late 1997, Yacura and his team were bouncing around ideas on how to use their unique skills to help the company and keep the procurement group employed.
"I knew the service establishment group [who sells credit card services to restaurant chains] is always looking for new ideas on how to add value for their clients," says Yacura. So in early 1998, when a member of his team attended a service establishment marketing meeting, Yacura's group introduced a new entrepreneurial idea.
"We had a large restaurant chain that spent more than $1 million a year in printing things like guest checks and cash register paper rolls," Yacura explains. "We went to our printer and asked if they would allow a third party to buy printed forms at our rate. The answer was yes."
Would the service establishment marketing people approach the restaurant chain to propose a unique extension of American Express's procurement prowess? The answer: yes again.
"Now, we pass on a 16% reduction in printing costs to the customer," says Yacura. "In exchange, we get the American Express logo printed on the bottom of their restaurant checks for free, a service for which we used to pay."
American Express has launched a marketing program to pitch the "partner supply program" for printed forms to the top restaurant chains in North America. With one person in his 220 person global procurement group dedicated to the service establishment program, Yacura admits he feels like the program is forcing his group to be more entrepreneurial.
The procurement group has to answer lots of start-up questions: "How do we standardize the service? How do we track the queries? How do we track the value returned? How do we determine what service to offer after printed forms?" asks Yacura.
The venture is forcing procurement to address another question too. Chiefly, how does one become a better listener? "We have to be more attuned to the different needs of different customers," says Yacura.
For Yacura, who also is exploring a pilot program to sell procurement consulting services, the procurement-for-profit trend is exciting. Like any good entrepreneur, "we had to think outside the box," says Yacura. "But there were no massive studies. The economics just sounded right."
Now Playing:
Web's real potential lies beyond transaction
03/23/2000American Express charges ahead
11/04/2004
