dimanche 30 novembre 2014

Crisis Communication

The main factor of crisis for credit card brands is the fraud through computer breaches.

v  The subprimes crisis in 2007 didn’t have a direct impact on these brands, contrary to banks.
The only one example of crisis communication about it is the American Express’s one. During this period, the company monetised its customer relationship. It gave a reward of 300 dollars to its risky clients who accepted to close their count and to pay back their debts. American Express didn’t reveal the numbers of concerned people, but it’s about few rentable clients and, above all, who presented a risk of no pay back of credit.
 
 
 

v  Thus, in crisis communication, Visa and MasterCard illustrates themselves in communications about credit card fraud essentially.

In 2005, MasterCard International reported that more than 40 million credit card accounts of all brands might have been exposed to fraud through a computer security breach at a payment processing company, perhaps the largest case of stolen consumer data to date.
MasterCard said its analysts and law enforcement officials had identified a pattern of fraudulent charges that were traced to an intrusion at CardSystems Solutions of Tucson, Ariz., which processes more than $15 billion in payments for small to midsize merchants and financial institutions each year.
About 20 million Visa and 13.9 million MasterCard accounts were compromised. A MasterCard spokeswoman, Sharon Gamsin, said an infiltrator had managed to place a computer code or script on the CardSystems network that made it possible to extract information. She would not elaborate on how long the breach might have lasted, on when the inquiry began or on whether any infiltrators had been identified. She did say that the breach occurred this year.

Thus, in this case we notice that the crisis communication for credit cards brands is essentially based on the main information without providing more details about the major issue. There is no information about the time, the way that the issue would be solved.

 


v  The other main issue is about the competitors.

For instance, in 2012, Visa, MasterCard and major banks agreed to pay retailers at least $6billion to settle a long-running lawsuit, which alleged that the card issuers conspired to fix the fees that stores pay to accept credit cards.

The pact, which lawyers involved in the case are calling the largest antitrust settlement in U.S. history, is seen as a major victory for merchants who have long complained about the billions of dollars in so-called 'swipe' or 'interchange' fees they pay to banks for each purchase made using plastic.

Noah Hanft, general counsel for MasterCard, said the company believed its interests were 'best served by an amicable resolution' of the case.

Visa Chief Executive Officer Joseph Saunders said the settlement was in the best interest of all parties and did not expect the settlement to impact its current guidance.

 
Thus, crisis communications of credit cards brands is always about reassuring and encouraging the public opinion in order to comfort their leadership in this market.

 



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