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Target's lost opportunity to say it's sorry


Given every opportunity to apologize for a malware attack last year, Target (TGT) continues to hide behind technical verbiage and bloodless excuses. The strategy might be legally satisfying but it’s destroying the company’s brand and alienating customers.

The company gets another chance to say it’s sorry today when executives testify before Congress today about the malware attack that compromised the financial and personal information of as many as 110 million customers. The testimony comes a day after the Senate Committee on Commerce, Science, and Transportation released “A ‘Kill Chain’ Analysis of the 2013 Target Data Breach” that once again documented Target’s failure to act on several warnings.

Defenders argue that Target is already bending over backwards to appease the angry masses. The malware was installed through a vendor and attacks have happened at other major retailers. Objectively speaking a 10% discount the weekend before Christmas; cut-rate credit monitoring and throwing an exec under the bus should have been more than enough.

The problem with that strategy is that shopping isn’t objective. It’s emotional. Shoppers are furious at the entire retail industry and they’re taking it out on Target. When asked if they “really believe organizations care about your private data,” 72.5% of people surveyed by HyTech say ‘No.' Throwing an executive under the bus and offering a 10% discount isn’t going to convince shoppers that Target cares.

The genius of Target’s business model is offering low prices with dignity. People hate Walmart (WMT) in large part because the rundown stores are an insult. Even people who can afford paying full price appreciate a deal. Target stores are supposed to be clean, efficient and safe. Calling customers “guests” seems ridiculous to some people but the idea is to convey a certain respect for people who enter the store. Giving customers 10% discounts and cut-rate credit monitoring is insulting.

What Target needs to do is grovel. Once they take full responsibility for the attack the shock value of negative headlines disappears. It’s not enough to apologize. Target needs to strike a tone of abject contrition and furious determination to never allow customers to be defiled this way again. The company can makes itself a story of redemption. If Target struck just the right chord it could actually steal market share by swaying the distrustful masses. Instead it’s posing as just another bloodless, lawyered-up conglomerate.

Shareholders, employees and, yes, “guests” deserve better.

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