| Market Capitalization (Millions $) |
41,213 |
| Shares
Outstanding (Millions) |
251 |
| Employees |
21,100 |
| Revenues (TTM) (Millions $) |
12,999 |
| Net Income (TTM) (Millions $) |
4,446 |
| Cash Flow (TTM) (Millions $) |
-3,229 |
| Capital Exp. (TTM) (Millions $) |
268 |
Discover Financial Services
Discover Financial Services Overview
Founded in 1986, Discover Financial Services has established itself as a preeminent player in the financial services sector, known primarily for its credit card issuance and electronic payment processing capabilities. Over the years, Discover has evolved into one of the largest credit card issuers in the United States and has developed a robust payment processing network that distinguishes it from its peers.
Key Business Areas
Credit Card Issuance
Discover issues a variety of credit cards under the Discover Card brand, primarily targeting consumers and small businesses. Many of these cards are designed to provide cash-back rewards through a Cashback Bonus program, appealing to cost-conscious consumers looking for benefits on their purchases.
In addition to its cashback offerings, Discover provides a suite of banking products, including:
- Personal loans
- Student loans
- Certificates of deposit (CDs)
- Money market accounts
The cards issued by Discover are widely accepted across millions of merchant locations in the United States and beyond, with significant acceptance in Mexico, Canada, and the Caribbean.
Payment Processing
Discover operates two unique payment networks:
1. Discover Network: The credit and debit card network that powers Discover-branded cards and processes transactions.
2. PULSE Network: A debit network that provides additional transaction processing capabilities, enhancing Discovers reach in both credit and debit markets.
The companys payment processing division gained momentum after the resolution of the U.S. Department of Justice litigation against Visa and MasterCard, which allowed Discover to expand its network services significantly by acquiring PULSE Network and forming partnerships with various financial institutions.
International Presence
Discover has a presence in international markets, particularly the United Kingdom, where it issues credit cards on the MasterCard and Visa networks. This portfolio includes prominent brands such as Goldfish'one of the UK's leading rewards credit cards'as well as various cards co-branded with financial institutions like Morgan Stanley.
In early 2008, Discover Financial Services announced its intention to divest its U.K. credit card business to Barclays Bank, prompting a shift in its strategy regarding its international segment.
Market Strategy and Customer Acquisition
Discover Financial Services employs a comprehensive customer acquisition strategy, which is deeply integrated with risk management processes. The company utilizes proprietary data analytics and targeted marketing tactics across multiple channels, including:
- Direct mail campaigns
- Internet advertising
- Print media
- Direct response television
- Telemarketing
This approach allows Discover to identify and engage with creditworthy individuals that match their product offerings, optimizing customer acquisition efforts.
Competitive Landscape
Discover competes in the credit card market against several well-established institutions, including American Express, Bank of America, Chase, and Citigroup, among others. The competition is rooted in various factors:
- Merchant Acceptance: Attracting merchants to accept Discover cards through competitive agreements and incentives.
- Products and Services: Continuously innovating to align offerings with consumer needs.
- Rewards Programs: Developing attractive incentives that drive customer loyalty and usage.
- Brand Recognition: Leveraging its strong brand presence in the financial services sector.
In the U.K. market, competition similarly includes other financial giants like Barclays, Capital One, and the Royal Bank of Scotland. Here, advertising, marketing, competitive interest rates, and promotional offers such as low-cost balance transfers are pivotal in attracting and retaining customers.
In addition to consumer credit, Discovers third-party payments business competes with networks like Visa, MasterCard, and American Express to provide credit, debit, and prepaid card solutions to various financial institutions.
Conclusion
Discover Financial Services remains a significant player in the U.S. financial landscape through its diverse array of credit products, robust payment processing networks, and dynamic marketing strategy. Its commitment to innovation and customer satisfaction, coupled with its strategic positioning in both domestic and international markets, positions Discover favorably for sustained growth and competitiveness in the evolving financial services arena.
Company Address: 2500 Lake Cook Road Riverwoods 60015 IL
Company Phone Number: 405-0900 Stock Exchange / Ticker: NYSE DFS
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