For Wright Express, Data Is Key To Fleet Card and Business Payments Future

Transcription

1 For Wright Express, Data Is Key To Fleet Card and Business Payments Future Hi, this is David Evans. Every so often, I get to talk to the CEOs and leadership of some of the great companies in the payments business. Today, I m talking to the two top execs at Wright Express, which is one of the leading fleet card and payments solutions providers for businesses. Joining in the conversation today is Mike Dubyak, who is the CEO and President, and Melissa Smith, who is the President of The Americas. Mike and Melissa, thanks a lot for joining me. SMITH: You re welcome. Thank you. Hey Mike, not everyone knows what the fleet card business is. Could you just give us a quick summary? Yeah. We play a role in the fleet marketplace in terms of providing to fleets the management capabilities when they re buying fuel, or buying services on their vehicles, to have the ability to control who s buying, what they re buying, where they re buying, so it gives them great security and control and 1

2 information solutions. We have our card accepted at over 90% of every gas station and truck stop in the United States, over 350,000 businesses, and six and a half million vehicles use our products worldwide. So, whether they re supplying to small businesses all the way up to the largest businesses, and largest government agencies like the federal government, these solutions for them to manage, as I said, their business more effectively through our closed-loop network, and the value proposition we supply through this security control and information solutions. Sounds great. And I know that Wright Express has been very successful over the years. What are the major products, and what problems do those products solve, and who do they solve them for? Yeah, if you re a fleet manager, you want to know that your drivers are getting in and out of a service stop, a gas station, a fuel stop, as quickly as possible. You want to make sure they re only buying the products that you prefer that they buy. So we give them the security of knowing that every driver when they go into a station, put their card, and they pay at the pump, or wherever they have to get the authorization accomplished, we re going to prompt that driver for a driver ID, so it s a PIN 2

3 number. We have security on, is the driver still authorized to fuel for that fleet. They re going to be prompted to enter their odometer reading. We know the date now, the location of the site, the product, the quantity, so we can restrict the card to six different levels, fuel only, fuel and motor only, and you can keep going down the list. So you re really saying, what can my driver buy? Hopefully I know it s one of my drivers, you know someone found a card, because they have to have the PIN number. And I have all this data to track where they bought, when they bought, what they bought. And if you re a major fleet, you can have up to seven levels of hierarchy, so you can have regions, districts, you know corporate all having different authorizations to decide who s doing what with the products, and seeing all the accessory reports as well. So we re really giving a fleet of any size, and again, this is just not just over the road. These are local landscapers up to people like AT&T, the ability, really to manage, you know, who can buy, and what they can buy on a regular basis. Sounds like a lot of data. I want to get back to that in just a few minutes, but first, you guys have a proprietary network, but you also offer private labeling, co-branded fleet products. What s 3

4 the relationship between those, and what you own, what you have in your run, and what you do in collaboration with others out there? Yeah, we definitely have a hybrid marketing program, as we call it, because we have our own direct operation. We built a closed network, where we control the life cycle of a transaction by owning the relationships with the merchants, which in this case are primarily gasoline stations, truck stops, and service merchants to do quick lubes, and tires, and things like that. So we can actually control the specification of all the different aspects I just talked about, the data elements that we bring together. So that gives fleets of any size the universality of going to almost any gas station to do a fueling transaction. But we also know there are other players in the market that we wanted to partner with that also bring great value propositions to fleets that they do business with. For example, the fleet management companies, these are the GEs, the PHHs, the Enterprises, the lease plans, they provide services to the companies that they lease their vehicles to. And they would also like to have as part of their value proposition a fleet card where they can track their assets, on the fleets they re leasing the vehicles to very precisely, very accurately. So we provide to 4

5 them a cobrand card, where it s good at all of the gas stations and truck stops that accept our card. But we re passing the information onto them, because they really truly provide an aggregated value proposition to their accounts. So that way, we have both a, if you will, a strategic offensive and defensive relationship through them, because they re bringing the fleets into the program, and they re securing those fleets with their value proposition. We also have private label, where oil companies, like an Exxon-Mobil, or Sunoco, or Conoco-Phillips, people like that want to have a fleet card accepted at their locations, only their brands, and they want to lock people into those stations. They might provide some incentive to those fleets to buy at their locations. So they may, again, have a value proposition that s different than the Wright Express direct value proposition, so it gives us another reach into the market through another channel. So between our cobrands, between our private labels, and between our direct universal product, we feel it optimizes the ability for us to win as much of the marketplace, either directly or indirectly. Hey Melissa, let s bring you into the conversation now. There s a lot of innovation going on in payments these days on the 5

6 consumer side. I don t know whether you ve had the opportunity to use the mobile up for Starbucks, or LevelUp, and I use those all the time down here in Boston, and that s just one example of some of the stuff that s going on on the consumer side. Melissa, is this innovation spilling over into the sort of B to B business that Wright Express is in? SMITH: Yeah, it certainly is, that we think that when it comes to mobile payments, that s something that will be more consumer-driven, and in other parts of our business, we found that B to B has driven the activity. So an example of that would be the amount of debt elements that we re collecting. That s transforming into new types of products within the marketplace. So that is helping the business become more efficient and effective, and so that may be more driven from a business perspective. But on a mobile side, we ve certainly seen that it is a trend, it s happening on the consumer side, and also in other regions of the world. So we re seeing more mobile payment activity in Australia, as an example, that we re able to learn from and then bring back ultimately here to the United States. Do you find that innovation is harder in the B to B environment than in the C to B environment? 6

7 SMITH: Sometimes, but not always. I think that it really depends on what it is. One of the things we pride ourselves on is when we are looking at a new customer prospect is to solve for complexity. So we re trying to find where our customers or prospect s biggest problems are. And an example of that, we were the first to market with a single-use product, a virtual paycard in And we really created that product by listening to what one of the very largest online travel agencies had for problems in terms of their ability to settle with hotels. We took their learnings, developed a product set with them, and they were able to export that into other customers within the online travel space, and we were the leading provider to online travel agencies and their B to B payments in the marketplace globally. This is very interesting. Mike, we were talking about data a few minutes ago. Data s a huge part of a value proposition of Wright Express. How does the capture and distribution of data change the ways in which you interact with your customers? And I m thinking, particularly as it related to the rise, what we were just talking about, mobile accessibility. Yeah, what we re seeing is that over time, besides our core fleet card program, we talked about all the teams that we can capture on that product when a transaction is done at a point- 7

8 of-sale. We also provide to our customers telematics. These telematic products provide GPS devices, provide alerts when, you know, a driver s doing something that s out of the norm for them. Or if the vehicle has something going on that needs to be concerned by the fleet manager, we can then start to take those data elements from the point-of-sale transactions on the fleet card, start to integrate those with the telematics information. So for example, a fleet manager could see a transaction took place at an Exxon-Mobil station, but they also can now match up to make sure the vehicle was there at the same time. So you start to integrate the data elements, and aggregate the data elements for even more savings and higher productivity capabilities for fleet. So we have a lot of data. We see this as something that we re going to try to play more of a role of in the future. And not just on the fleet side. We see that the data that we re aggregating, even on the virtual card, can also be something that over time, we think could have, you know a data analytics value propositions created for our customers and our partners. Now I don t know how much you can share with me for the last question I have for you, and please, either one of you chime in here. What s on your road map for Wright Express, what you can 8

9 tell us about, concerning your core businesses? And any interesting strategies you can share with us, recognizing that your answers are going to be blasted out to the world. SMITH: (laughter) So when we think about the future, and fleet payments and non-fleet payments, we re thinking about the concept that Mike just talked about is, data integrations, and the data collections, is really integral to the product life longterm. And so, you know, what we re learning from the fleet marketplace, particularly in the larger fleets is the desire to get more and better information at their fingertips more readily. And so, a lot of the future road maps are designed around that, as well as taking that functionality that we have and globalizing it. On the other payment side of our business, we are looking at the ability to merge these product sets together. And so, on the virtual side of our business, we ve been able to take that functionality and sell it into existing customers. We ve been able to do the same thing on our pay card business. And as we re learning from that is how you can develop features and functions that create something that s even more meaningfully unique by tying all those pieces together. 9

10 Two of the questions for you, just because I think that our audience might be curious about them, and I am, where are you guys located? We re located in Portland, Maine. That s an interesting location. I bet it s beautiful up there. It s a great place to live, and to run a business. And final question, I gather from your title, Melissa, being Head of the Americas, and some of your comments that Wright Express operates outside of the United States, can you tell us a little bit about what your geographic footprint is? Sure. We originated here in the United States. We have five offices here in the US, actually soon to be six. And then outside of the United States, we actually just bought a business in Brazil. We have operations in Australia, New Zealand, and local offices within the UK. Sounds really interesting. Well look, I really appreciate your time today. It s a fascinating business, and I really appreciate learning more about it. Thank you, David. 10