The Customer Effect

What Hurricane Matthew taught us about banks and fintechs

  • Hurricane Matthew was the perfect storm to show how upstarts and incumbents differ when it comes to customer care.
  • Unsurprisingly, the institutions that have been at the business longest came out ahead - by a long shot.
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What Hurricane Matthew taught us about banks and fintechs

When Hurricane Matthew swept through Haiti, the Bermudas, and finally up the East Coast, the results were devastating: at least 900 people died in Haiti, and another 33 people lost their lives to the storm in the U.S. Alongside the tragic certainty of these deaths lies the economic uncertainties churned up in the storm’s wake. Haiti is expected to face up to a decade of economic recovery, while Matthew may have cost North Carolina billions in losses.

Unlike other natural disasters, however, the U.S. knew about Hurricane Matthew well in advance, so it provided the perfect opportunity for banks and fintechs to prove their customer care mettle. “An approaching storm puts people in a position of vulnerability,” said Jon Picoult, founder & principal of Watermark Consulting, a U.S.-based customer experience advisory firm. “As such, it affords a great opportunity for companies to proactively communicate with their customers and demonstrate advocacy – be it by sharing relevant information, providing reassurance, or offering some other type of assistance during the customer’s time of need.”

Some national banks grasped the importance of connecting with their frightened customers, and did so (community banks in the affected areas aren’t being counted for the purpose of this article, although, as community banks do, they were very communicative and supportive regarding all things Matthew).

Witness USAA’s epistle to customers in Matthew’s path (full disclosure: I bank with USAA):
screen-shot-2016-10-19-at-11-26-28-am

With this message, the insurance, banking, and investment company serving military personnel, veterans, and their families effectively ticked off everything on Picoult’s list. It shared relevant information to help customers protect their property, it provided reassurance, and it offered three different paths of assistance: online, digital, and phone.

The company also sent out three tweets about hurricane safety precautions:

Obviously, the more customers took steps to protect their property, the less USAA would have to pay out in claims. Yet the fact remains that the way in which the company communicated with customers in need was timely and on the mark. Not to mention that USAA followed up, by email

screen-shot-2016-10-19-at-11-24-59-am

and front and center on its website:

screen-shot-2016-10-19-at-11-37-47-am

Like USAA, JPMorgan Chase also understood the importance of connecting with customers as Hurricane Matthew fast approached. “On Wednesday afternoon, we posted a Weather Update ad (see bottom right) on the front page of chase.com that was visible only to people with IP addresses in Florida,” said Chase’s Tom Kelly. “That took them directly to the Branch Locator, which the bank updates in real time.”

Chase kept the severe weather ad up for 6 days.
Chase kept the severe weather ad up for 6 days.

The JPMC’s retail arm also tweeted about branch openings after Matthew passed through, showing not just its customers but the world that Chase was concerned about its customers on the east coast.

 

What of fintechs? At the time of publication, Credit Karma, Wealthfront, Square, and Quicken Loan’s Rocket Mortgage had not responded to Tradestreaming’s request for a comment. But PayPal did. “We aren’t doing anything specific on Venmo,” said Andy Lutzky, vp at Edelman. However, “in an effort to support relief efforts, Xoom is waiving fees for all services through October 15.”

So although PayPal graciously eased remittances for storm-struck Haitians, it didn’t treat the hurricane as a customer care issue. The fact that one of the more popular P2P money transfer apps didn’t see the need to address Hurricane Matthew suggests that fintechs might not be quite caught up with banks when it comes to customer care.

Of course, to be fair to fintechs, part of the reason that national banks seem to have outperformed fintechs in the emergency customer care category during the hurricane is because banks have been at the business longer. “As we’re in early days of our on-demand insurance product, and currently only available in Australia, we don’t do any proactive messaging around natural disasters,” Jeff Berezny, vp of marketing and communications at online insurer Trov.

The company is at least thinking about how natural disasters and customer care intersect. “A broader, proactive plan related to prevention is in the works that could include content-related to natural disasters, but it has not yet been activated,” Berezny said.

This is not to say that every national bank was on top of their customer care game as Hurricane Matthew stampeded towards Florida and North Carolina, nor that every fintech company was oblivious of the storm. But the above examples suggest that fintech companies, whether they want to go it solo, partner with banks, or become banks, could take a page or two from banks’ trusty customer care books.

 

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