Originally Posted by ChuckW
Man, that policy is so out of date and just plain stupid. It will cost them my business, at least.
I agree... but they've had various reasons for it in the past, such as customer privacy and customer loyalty.The real reason: Until very recently, Neiman Marcus had a 10-year exclusive card acceptance agreement with American Express.
The agreement was very strict: in exchange for a lower merchant fee, NM stores could only accept American Express and their store credit card (which was issued by NM). And only American Express could issue a co-branded Neiman Marcus credit card (this part was never adopted). The agreement didn't cover Bergdorf Goodman or Horchow (also owned by Neiman Marcus), nor did it cover neimanmarcus.com, as it was launched in 1999 (two years after the agreement was signed).
However, the agreement ran dry recently, as HSBC Bank USA took over Neiman Marcus's store credit cards in mid-2005, although the American Express agreement had two years left. The HSBC agreement said that only HSBC (which is one of the five biggest MasterCard issuers in the US) could issue a co-branded card for Neiman Marcus. This conflicted with the American Express agreement. Shortly afterward, in preparation for the expiration of the American Express agreement, HSBC signed a deal with American Express to issue co-branded cards for various retailers on the American Express network. This is much like American Express's deals with Bank of America, Citi, USAA (the military bank), and GE where the transactions are only processed
by American Express... they do not issue the cards, HSBC does. NM's American Express exclusive agreement was not renewed as an exclusive agreement, mainly so HSBC could issue a co-branded Neiman Marcus card that will run on the American Express network. NM's new agreements with American Express and HSBC also allow for other cards to be accepted at Neiman Marcus stores if NM chooses, but there are no firm plans to do so at this time.
The new NM Amex card is currently being tested among top Neiman Marcus customers, and will undergo a full launch later this year (at the time NM celebrates their 100th anniversary, of course!).