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Designers, Retailers and American Express Join Forces in New Ad

July 11, 1988

NEW YORK (AP) _ It’s almost like a mini-catalog: A magazine advertisement offers designer clothing and accessories that readers can order immediately from some of the nation’s top retailers by using the American Express card.

The main thrust of the seven-page ad, which appears in the August issue of Elle magazine, is that you can use American Express for retail purchases. But it also gives consumers a chance to do some one-time shopping at three upscale stores that are getting some big national exposure.

One section of the ad shows wool separates by Crisca that can be ordered by phone from Burdine’s. Another displays watches by Raymond Weil and cosmetics by Stendhal that can be bought from Macy’s, while a third offers Bruno Magli shoes and a shoulder bag available at Neiman Marcus.

Each of the models in the ad holds an American Express card, and each page reminds consumers the merchandise can be paid for with the card. The Macy’s and Burdine’s sections additionally note toll-free telephone numbers readers can call to place their orders.

The ad is an extension of traditional cooperative advertising, in which a product is prominently displayed while a retailer’s name is noted in comparatively small print, often at the bottom of a page.

Elle, an upscale women’s magazine, carries traditional coop ads. In its July issue, for example, two ads for Yves Saint Laurent note that the French designer label is available at Neiman Marcus, Saks Fifth Avenue or I. Magnin.

What’s different about this newest ad is the prominent display of the retailers and the charge card along with the merchandise. It looks like a catalog, it gives the consumer a chance to buy an advertised item immediately and it tells the shopper how to do it. The ad accomplishes several objectives for retailers.

It offers them a chance to further their upscale image by associating themselves with designer merchandise and with American Express, which is perceived as a prestige card, said Joseph Ronning, a retail industry analyst with the investment firm Brown Brothers Harriman Inc.

The ad also gives the retailers a chance to pick up some business from customers outside their immediate areas and generate future sales, Ronning said.

Burdine’s, for example, has 27 stores in Florida, and it is likely that readers in far-off states would, after seeing the ad, shop in one of its stores during a vacation, he said.

The ad is also a way for consumers to find that if they have an American Express card, they can still shop at a store even if they don’t have the retailer’s own credit card.

″For all of them, it’s important to tell the customer you can use your AmEx card here,″ Ronning said.

But the one with the most to gain from the ad is American Express, which is wants to establish itself as a retail charge card, and not just a travel and entertainment card.

In recent months, American Express has tried to move in on the retail turf traditionally held by Visa and MasterCard. The company is offering incentives for cardholders to buy merchandise with the card, including 90 days of insurance on every retail purchase made through American Express.

The Elle spread, done by the advertising agency Cabouli Inc., is an extension of coop ads American Express took out with restaurants in the past, said Keith Hark, a spokesman for American Express. He said all the companies named in the latest ad contributed toward its cost, but he declined to say how much any one of them paid.

Jim Dunaway, director of information for the Newspaper Advertising Bureau, a trade group, said American Express is ″trying to build the sale into their advertising.″

Dunaway compared the Elle display to ads American Express has placed on newspaper weather pages. Travelers, who are likely to consult those pages, could be inspired to use their charge cards during their trip, he said.

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