Target Facing Public Relations Nightmare After Breach

As a longtime retail reporter and advocate, I feel sorry for Target (NYSE: TGT), the subject of perhaps the biggest card heist in U.S. history linked to one retailer. As a consumer who used my debit card at Target during the doomed November 27 – December 15 time period, I certainly wish my card data had been better protected. From a retailer’s point-of-view, however, Target is just as much a victim as its shoppers. Week after week, reports on the fact that credit and debit card thieves have become much more sophisticated in their skimming and electronic theft methods. They are simply outwitting retailers’ systems and their employees. Bank ATMs and retail cash registers have been compromised by mag card skimming devices for years. So, if that’s how the Target heist happened, it is something that many others have fallen victim to. Other retail card fraud events are just not as well-publicized, because they are not on the same massive scale as the Target breach. Now, many Target customers across the country have filed complaints against Target over the breach, seeking class action status. Even though Target said it immediately alerted authorities and financial institutions once it became aware of the breach, many shoppers believe the retailer did not notify them soon enough. And some Chase customers reportedly were prevented from making Christmas purchases on their cards, thanks to the data breach. Some banks placed daily limits on ATM withdrawals during the busy holiday shopping season. Of course, this is the public relations nightmare that no retailer wants to deal with. There is nothing a retailer can say to a shopper who was not able to use their credit card to buy holiday gifts as planned. There is nothing they can say to shoppers who had hundreds of dollars of bills racked up on their cards by a thief in another country or another part of the U.S. Theft is theft, and they simply feel violated. However, now that the breach is out in the open, there are certain steps that Target can take to make this public relations nightmare less severe. Target has already made some of those efforts, telling shoppers that it immediately teamed up with a third-party forensics firm to investigate the matter and prevent future breaches. Plus, Target launched a dedicated web site to communicate with customers about the breach, after it became aware of fake communications claiming to be from the retailer. Next, Target should set up a council or forum to dissect this massive fraud incident and prevent future incidents at its stores – and other retail chains. Representatives from the National Retail Federation (NRF) and other retail groups, along with security organizations and other retail executives should sit on this forum. From a public relations and consumer-facing standpoint, this move would help demonstrate that credit card fraud is a serious problem that the entire global retail industry faces and is working to find solutions—together. Meanwhile, Walmart (NYSE: WMT), Sears (NASDQ: SHLD), Amazon (NASDAQ: AMZN), and every other major retail chain must double their efforts to ensure the systems in their physical stores and online shops are secure. There is no such thing as fully recovering from a public relations incident as bad as this one.