Putting data in the driver's seat, WEX shifts its fleet market to mobile
From its origins as the fuel card operator Wright Express that launched 35 years ago, the fleet card provider WEX has aggressively expanded to other corporate sectors including travel and health care. But fleet cards still inspire some of the company’s most interesting innovations.
WEX is also finding new ways to leverage big data to gain an edge over rivals in the increasingly competitive fleet card market, where FleetCor and its Comdata subsidiary, along with U.S. Bank Voyager, are top rivals.
Professional drivers practically live in their vehicles, and the rise of mobile technology has enabled WEX to re-engineer fuel and fleet cards, untethering them from static platforms and adding new streams of data for fresh capabilities.
A truly mobile workforce
As much as companies like WEX strive to innovate, the fleet card market as a whole has been hampered by an aversion to putting mobile technology in front of drivers.
"If you look at the world of fleet, there's historically been hesitancy around that; there's been safety concerns [about] people using cell phones in a vehicle and at a pump," said Melissa Smith, WEX's president and CEO.
Nevertheless,WEX saw a strong value to getting its technology onto smartphones. DriverDash, a mobile payments app WEX launched this month at 11,000 ExxonMobil stations, is the latest example of technology replacing the proprietary fuel card with a digital approach. The product retains fuel management and control tools but enables drivers to authorize fuel fill-up from inside the vehicle.
This deployment was no small feat — even ExxonMobil had to get over its own hangups about mobile technology. Until mid-2013, the company posted warning decals that cautioned drivers against using cell phones at the pump, due to the myth that doing so could cause a fire. These signs came down when ExxonMobil began a tentative test of a mobile version of its SpeedPass payment system at 27 locations.
The new DriverDash system allows WEX to address the many complications that drivers face when using a plastic card.
By handling payments through a mobile app, WEX can eliminate the time it takes to get a plastic card into drivers' hands. Right now DriverDash is little more than a digital version of a plastic card, but WEX designed it to be a platform that will evolve over time.
"We see this as something that we're going to continue to build upon," Smith said. "There's a lot that we can do, ultimately, to capture different types of data by having people use an application."
DriverDash pairs well with ClearView, WEX's app for fleet managers and business owners. Managers who collect data from drivers through a smartphone dashboard can receive alerts about unusual behavior they need to correct — such as drivers buying premium fuel or misusing their fleet cards for personal spending.
The drivers themselves benefit from having more technology at their fingertips as well, said Peggy Watson, vice president of product management for WEX’s North American fleet products.
“Truck drivers told us their office is in their truck, so this technology brings the office to them,” she said.
Some of the benefits of mobile technology are unintentional. Back in 2012, in the aftermath of Hurricane Sandy, WEX discovered that its WEX Connect app — which directs drivers to the cheapest gas stations based on distance — had inadvertently become a tool to map which gas stations were knocked out by the storm, since those stations stopped sending updated gas pricing via WEX Connect users.
“The core of fuel card technology is collecting data for fleet managers to control and manage fuel consumption and spending, but it’s how we digest that data that’s going to make a critical difference as even more data accumulates,” Watson said.
WEX predicts its technology will be a key advantage as the U.S. moves closer to the 2020 EMV liability shift for pumps, in combination with tools like DriverDash that use both fingerprint and facial recognition to authenticate users. Introducing biometrics will eliminate several pain points by speeding up the fueling process, but it also cuts out time-consuming calls to the fleet manager's office when drivers lose or forget their PIN and driver ID numbers, Watson said.
“Biometrics eventually will make driver set-up and authentication for fuel payment on specific vehicles completely frictionless,” she said.
In trades like plumbing and landscaping where employees are assigned to drive different fleet vehicles, glitches like getting authorization for a fuel payment can cause costly slowdowns on jobs.
New partners, new paths
WEX is setting up relationships with third-party data providers to triangulate different information with its base of more than 10 million vehicles in the U.S. and its growing mobile technology capabilities.
WEX last year announced a strategic partnership with GasBuddy, a travel app 200 million consumers use that taps millions of endpoints from Waze, Google Maps and GPS to crowdsource gasoline price data. The goal is to leverage WEX’s technology, data and access to fuel retail sites with GasBuddy and enrich the data available to fleet drivers.
“The intersection of new streams of data, mobile technology and payments is taking us into a connected future of cards and vehicles that will be really interesting when combined with WEX’s closed-loop retail network and the quality of information it generates,” Watson said.
WEX is also using data and partnerships to position itself well for the future of connected fleets, according to WEX executives.
"We're keeping an eye on how connected vehicles and commerce are evolving, and we see how our tools and data can be part of a compelling value proposition for that future," said Watson.
But just as paper still dominates in B2B payments, mobile payments have not displaced physical cards yet.
“Cards aren’t going away any time soon,” Watson said, noting that a major limitation of the company’s newest solutions is the need to mesh with the existing hardware of merchants dispensing fuel and other items necessary for fleets.
To target fleet operators that fell in between dedicated small-truck fleets and large, long-haul trucking firms, WEX this year rolled out Cross Roads, a variation on its existing closed-loop fuel network card that works for fleets with a mixture of different types of vehicles, accepted at both truck stops and convenience stores.
Cross Roads has the same controls of its core fleet cards enabling fleet managers to track fuel spending on a single reporting system with ClearView integration, with discounts on fuel and other needs including tires, office supplies and wireless plans.
"We had different products for small and large fleets, but we realized we needed one card that offered all our solutions through a single channel for companies with diverse fleets," Watson said.
Key acquisitions in recent years boosted WEX's customized payment solutions for fleets.
In 2012 WEX paid $369 million for Fleet One, which was strong in fuel and payment services for heavy trucks in the U.S. and Canada.
Three years later WEX paid $1.4 billion for Electronic Funds Source (EFS), a provider of long-haul trucking fleet and corporate payments technology, expanding the company's transaction processing capacity.
EFS uses an API-based approach to onboarding new clients, which WEX is adapting to some of its other business sectors. WEX also has ported certain new tools from its corporate and travel industry payments to its fuel card and fleet card operations, according to company executives.
For example, WEX's work as a processor for travel agencies led to developing a faster and more secure method for truck fleet operators to make one-time payments.
"We applied technology from the one-time-use ghost Mastercard payments for the travel industry to fleets, so if a driver has a flat tire in the middle of nowhere, the fleet manager can send the driver a payment code accepted at any tire shop," said Bernie Kavanaugh, WEX’s senior vice president and general manager of large fleets.
WEX also scored a coup in late 2016 when it won a major contract to operate Chevron and Texaco-branded commercial fleet cards; the business previously was handled by rival FleetCor.
"Chevron has a big presence in the west in the U.S., which gives us additional geographic reach," Watson said.
WEX is also eligible to provide fleet card and payment services to the U.S. government through an ongoing partnership with Citi.
"WEX has been in government payments for a long time and we have a good grasp of the business, plus our technology—including ClearView—provides a lot of the features people are asking for," Kavanaugh said.