Target data breach creates poor retail customer experience

Target's security breach damaged more than wallets; poor retail experience hurts relationships with customers.

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Target Corp.'s security breach has led to a customer service nightmare for many.

Multiple news outlets learned of the breach before Target Corp. made a statement or an announcement, leading to angry, panicked customers calling in to Target's contact center and visiting its website en masse. The breach, which affected customers who had shopped at U.S. Target stores between Nov. 27, 2013, and Dec. 15, 2013, affected some 40 million customers. Target admitted the breach Thursday, Dec. 19.

When you take half-assed measures like [Target] is doing now, you can expect customers to be unhappy.

R. Wang,
principal analyst, founder and chairman, Constellation Research Inc.

The timing of the event was particularly bad luck. Customers trying to contact Target on its customer service number waited in long phone queues or heard only busy signals on the other end of the line with no response, while its website was unable to handle the surge in traffic and crashed. The lack of timely response created a negative retail customer experience.

"Target is swamped from the holiday shopping and the fraud experience and, while they're staffed up, they're not staffed enough to handle both," said R "Ray" Wang, principal analyst, founder and chairman at Constellation Research Inc.

Is there anything that might have alleviated the traffic? "I'm willing to wager Target has an on-premises contact center," said Rebecca Wettemann, vice president of research at Boston-based Nucleus Research Inc. "If they had a contact center in the cloud, they could scale up resources to handle the increased calls," she continued. "It's possible to pool remote resources to answer the phone when a company has a short-term spike."

Not a happy holiday

"ARE YOU KIDDING ME!!!" wrote a frustrated customer on Target's Facebook page. "After 48 minutes on hold with Target, suddenly a busy signal and my call was dropped. ARE YOU KIDDING? This is completely unacceptable."

Other customers used the page simply to express grievances and ask how to proceed. "I tried calling and get a busy signal," another customer wrote. "[I] can't go to the service counter as I live 90 miles away and am in the middle of a blizzard. Any other suggestions?"

Target responded to most customer posts but used near-identical responses that have been criticized as nonchalant. "Social media as a channel is great, but if they were paying attention to their customers' concerns, they would do something else," Constellation's Wang said, adding that social media tends to be a poor venue to communicate sensitive information and that simply responding to tweets and Facebook posts isn't a proactive strategy.

Because many Target customers were making last-minute purchases or traveling for the holiday using the same credit cards that were at risk, canceling credit cards isn't always an option, leading many customers to feel stuck.

"The customers are fearful," Wang said. "Most people now understand the impact of an identity or security breach, and this is causing undue stress during the holidays."

A New Year's resolution for retailers?

"We continue to experience a high volume of calls to our call center," said Molly Snyder, manager of public relations for Target, "and have more than doubled the number of team members taking calls around the clock to help them resolve any issues they may have." She added that unless customers have noticed fraudulent activity on an account, there is no urgent need to call.

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Snyder also noted that Target's social media team has used that channel to send tips to customers, as they did with step-by-step instructions on how to set up alerts to be notified every time a transaction is made on a Target REDcard, the company's credit card.

But many of Target Corp's customers are still dissatisfied with Target's customer service.

"This may highlight the lack of preparedness retailers have to deal with this kind of technology," Nucleus Research's Wettemann said. "I'm sure [Target has] an extensive internal policy for dealing with [inventory] shrinkage; do they have one to deal with systems?"

Constellation's Wang suggested that retailers be more proactive during breaches, informing customers that their data may be compromised and doing damage control. In the case of Target REDcards, the company should have canceled accounts and reissued cards, he said. "It's expensive, but it's like a drug recall. When you take half-assed measures like they're doing now, you can expect customers to be unhappy."

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