SoFi’s lawsuits don’t seem to be affecting its brand
- Recent negative press of the SoFi CEO's resignation amid lawsuits hasn't affected the company's reputation as expressed in online sentiment.
- Perceptions that the company took quick action and being in the shadow of larger scandals in Silicon Valley has helped contain damage to the brand.
SoFi, the financial services startup that wants to be at the center of millennials’ economic, social and dating lives, has been through tumultuous recent weeks.
The resignation of the company’s co-founder and former CEO, Mike Cagney, amid lawsuits from employees stemming from sexual harassment allegations and other workplace issues has thrown into question whether the brand can continue to be known as a “different kind of finance company,” as it markets itself. But despite the bad news so far, the damage to the company’s standing seems to have been contained — the result of being in the shadow of bigger scandals in Silicon Valley and the company’s actions in the aftermath of the scandal.
“My gut response is that with a Page 1 story it doesn’t seem to have broken through; perhaps it has been overshadowed by bigger names,” said Dorothy Crenshaw, CEO of crisis communications firm Crenshaw Communications. “I’m a little stymied as to why this isn’t bigger news.”
Hi @sofi. I’ll be thinking about the way you handle yourselves in the coming weeks and months when considering refinancing my mortgage . . .
— john boles (@superboles) September 19, 2017
Based on online sentiment expressed on Twitter, Facebook, Instagram, blogs, forums and news sites between Aug. 12 and Sept. 23 (when the news of lawsuits first emerged), 71 percent of categorized mentions of the brand were positive, according to social media analytics firm Brandwatch. While sentiment dips Sept. 12-16 (reaching the level of 86 percent negative on Sept. 16, coinciding with Cagney’s resignation), feelings quickly rebound by Sept. 19, showing a certain resilience despite the negative press.
“This probe is not seeing the level of scrutiny that other, larger tech companies have endured,” said Kellan Terry, PR data manager at Brandwatch. “Uber is clearly a household name, whereas SoFi isn’t as much — it has a pretty healthy brand reputation, scandals notwithstanding.” SoFi was mentioned 27,000 times online during the data capture period, according to Brandwatch.
Terry noted the conversation about SoFi is very small compared to Uber, which once gathered hundreds of thousands of mentions a week.
In addition, the quick timing of Cagney’s resignation reduced the effects of the negative news, said Crenshaw.
“When a company moves quickly to take action and when the media and public see that a change has happened, people take notice and move on,” she said. “The coverage of Mike Cagney’s departure was very positive in the sense of turning the page. I don’t think it’ll be like an Uber. Remember how long [former Uber CEO] Travis [Kalanick] hung in there?”
A couple of longtime customers who spoke to Tearsheet won’t be rushing to switch loan providers anytime soon.
“I guess I don’t really care as it pertains to my loan,” said Alex Nocella, 27, a SoFi customer since 2013. “It damages my view with the way they’re operating their business, but it doesn’t change the relationship I have with them. It wouldn’t stop me from getting another loan with them.”
For Sean McNair, 33, who has been a SoFi customer for six years, the recent events have been cause for reflection.
“It’s important for companies to realize that being successful does come with a level of responsibility,” he said.
But despite the recent turn of events, McNair said he still holds the company in high regard as a customer. “It doesn’t change my overall perception of the company — its mission and way it interacts with members is still intact.”
In addition, he said, the company was proactive about informing customers of Cagney’s resignation prior to the news becoming public by giving them a heads-up on the customer-only Facebook group. Overall, he feels the recent events are an important lesson the company must deal with in order to grow and expand.
“To keep moving forward, they will have to make responsible decisions on their executive board, and I think they’ll do that.”