Credit Card

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Case Study : How much do credit card companies know about you? 1. What competitive strategy are the credit card companies pursuing? How do information systems support that strategy? The competitive strategy that the credit card companies are pursuing is product differentiation and customer and supplier intimacy. Product differentiation – we make use of IS in order to create new product and services at the lower cost. According to the case, the credit card companies are making use of the data to track down various buying habits and create new services in terms of promotions. For example, the credit card company can create new promotions on air tickets when they target individuals who have frequent habits of travelling via airplanes for…show more content…
Now company knows what service to offer to which customer and how to negotiate with the customers so that they can pay back the debt as soon as possible. The company can track down the customers who are very risky to the company and can list the customers as good and risky based on their credit limits and buying trend. This can improve customer’s relationship with the company. 3. Are these practices by credit card companies ethical? Are they an invasion of privacy? Why or why not? As every coin has two sides, similarly, the practices by the credit card companies can have both ethical and unethical effect. The right use of the information provided by the customer and causing no harm to their privacy is ethical. For example, the company uses the information to track down the buying habits of the customer so that they can provide the customer with the right kind of service seems ethical as the company caused no harm to the customer nor did the company sell customer’s information. But at the same time, some customer may feel that these companies are tracking and monitoring the way of living of the customer or some company may actually sell the private information of the customer for money, the customer might feel cheated. The customer might feel that the company has no right to intervene behind their backs. This can be unethical from customer’s point of

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