Monday, December 23, 2013

Target Steps Up with Extreme Customer Sensitivity

All you reporters horrified by Target’s 3-day delay in announcing that its credit card operation had been hacked can settle down now. You spent the whole of last week trying to get Target on the hook for something it was victimized by. Shoppers thumbed their noses at you, and a boat load of PR commentators who piled on for good measure.

Then, this last weekend, journalists and busy trial lawyers were trying to portray the CEO of Target as a perpetrator with his flawed surprise 10% discount announcement. The result? Target stores were flooded by people looking for bargains. Yes, a tiny handful got angry because there were unexpected exclusions (actually announced the day before and posted in stores) and customers didn't get the discount they should never have expected, and weren't entitled to. Naturally, those were the stories that appeared on television clips and quoted in local news coverage.

Here are the facts:

1. Target set the tone of responsibility and extreme customer interaction for events of this nature. I've been through many of these data loss scenarios and Target’s is among the most prompt, the most complete, and the most engaged with their customers of any in my experience.

2. Many local media suffered immediate memory loss regarding Target as an extraordinary victim in this particular case. And I rarely describe corporations as victims; Corporations and their leaders in these scenarios are more likely to be perpetrators.

Instead, the media and a wide variety of public PR commentators spent the weekend working to ding Target for every customer-helping suggestion or idea that was proposed to mitigate customer concerns and anticipate customer fears and questions.

3. Rather than looking at this situation as a whole, the media chose, as they usually do, to examine things incident by incident, circumstance by circumstance and failed to grasp the retailer’s likely overall strategy:
  • First to report the situation to the proper authorities and begin cooperating in the investigation in an attempt to catch those responsible before the crooks knew that Target and the authorities were on to them. 
  • At the same time, to determine the extent of the incursion, and then formulate a series of responses, each of which escalated in their importance and their positive impact on Target customers.
4. Then there was the handful of whiners who have now hired trial lawyers to again burnish the legal profession’s reputation by suing Target, a highly respected now victimized company. Guess you can file a law suit on any subject in this country, even for damages that have yet to happen.

5. The most important facts are these:
  • Everybody lived.
  • All animals survived.
  • The environment remains safe and protected and held harmless by Target and its customers in this circumstance.
  • Target gets to pay the bill for everything.
6. Target did what any sensible, honorable company should:
  • Do things that matter for those real and potential victims of the circumstance. 
  • Make additional announcements and add additional protections, comforts, and calming reassurances for customers. 
  • Surprise customers with acts of generosity (which the media and commentators attempted to portray as a CEO stumble, fumble, and bungle).
  • Prepare to endure the effects of bad news, badly reported because one thing Target knows for sure, the customers will keep coming.
The lesson is, let’s understand these scenarios more completely and, in the future, cover them more intelligently. I was interviewed a number of times about this story. Each time I expressed the view that Target has set an important standard here for the response to this kind of circumstance. I even called it a model response. These views were covered and reported.

One television station wanted to do a stand-up in a Target parking lot, but they couldn’t find a place to park.


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James E. Lukaszewski, ABC, APR, Fellow PRSA is the author of Lukaszewski on Crisis Communication, What Your CEO Needs to Know About Reputation Risk and Crisis Management, available now at Amazon.com.

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4 Comments:

Blogger The Lighthouse Keeper said...

Jim,

I am not a reporter. I am a customer and a very upset customer. Target has blown smoke and tried to bribe customs back into their stores.

First, I did shop at Target during the affected period. Target made empty promises about credit monitoring. I had to imitate a credit fraud alert at the three national bureaus. That meant two hours last weekend.

It took not the three days you cite, but more than a week and a half for Target to finally admit that PIN numbers to debit cards also were stolen. That meant my wife and I also calling to cancel those cardswi th our credit union and now having to wait 7 to 10 more days for new cards to be issued.

You over simplify the response of Target. It was far from responsible. They should be paying to protect the PII of its customers not putting up PR smokescreens and delaying announcements of how bad the situation is.

Oh, and NOW we also find out that they were selling gift cards and not properly activating those cards.

Count me as a former customer.

Tony De Cristofaro

December 31, 2013 at 5:40 PM  
Blogger The Lighthouse Keeper said...

Here is a follow up scream. Now on January 10...a month late, Target now says that there were 30 million more IDs stolen. A visit to the website STILL does not have free fraud monitoring set up for guests. Will you admit that this Chinese water torture of disclosure hurts both customers loyalty (what's left of it) and the tarnished Target brand? This is not a Johnson & Johnson Tylenol case.

January 10, 2014 at 5:02 PM  
Blogger Jim Lukaszewski said...

Yes, Target is not Tylenol. In some ways they are behaving better.

Here's Some Crisis Communications History Clarification about The Tylenol Incidents

Between the time seven people were murdered by cyanide tainted Tylenol in Chicago, in the Fall of l982, and when Johnson and Johnson officially ordered the product off the market six days later, the FBI, the FDA, and the CIA were recommending to J&J's CEO, James Burke, that the product be left on store shelves . . . Why?

-The FDA was afraid of copycat incidents (Halloween was coming up)
-The FBI wanted to catch the bad guys (If they did it again)
-The CIA wanted to prevent a potential propaganda victory (by America's terrorist enemies)

The true initial withdrawal of Tylenol came because of the media frenzy and neighborhood by neighborhood warnings by Chicago area police and fire departments.

The formal withdrawal of Tylenol from the market was actually triggered by a copycat attempted murder in California the following Tuesday (while Burke and others from J&J were visiting the FDA to consider a recall) . . . the poison used in California was Strychnine.

Four years later, in 1986, there was a second withdrawal of Tylenol due to cyanide tainted capsules in Westchester County, New York. One person died in that murder.
In New York, after just 72 hours, J & J announced their exit from the capsule business, a decision that would stand for 25 years.
It took J & J nearly a decade to finally get serious about settling the litigation brought by survivors from the Chicago poisonings.
The murderers in the Chicago deaths remain at large, despite a sensational claim made by a criminal in 2009.

Urban legend will continue to ignore some important details of the Tylenol case.

Source: Based on video taped comments by James Burke, former J & J CEO in: A Career in American Business, Harvard Business School Publishing (Item # 890-513), and the author’s files.

January 10, 2014 at 5:58 PM  
Blogger Rich Klein said...

JIm,
Here are my thoughts on Target's handling of the crisis based on an interview I did with Risk & Insurane magazine

http://www.riskandinsurance.com/target-as-target/

February 6, 2014 at 11:35 AM  

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