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Continued: Schafer: Target's response to data theft was too slow, too cautious

  • Article by: LEE SCHAFER , Star Tribune
  • Last update: January 19, 2014 - 6:35 AM

Almost a month after the data breach became public, Target’s CEO Gregg Steinhafel finally discussed it in front of a TV camera, speaking at length on CNBC on Monday.

He was apologetic. He vowed to fix any problems and explained that Target was still using magnetic card strip technology because the whole industry hadn’t wanted to move to newer technology.

He had several strong moments; perhaps his best was when he said, “There is zero liability for the guest. Zero. I mean, we are responsible. We’re accountable for all of it.”

He gave the impression of having been particularly well-drilled for this interview and showed the savvy politician’s knack for gently knocking aside a question and really sticking to his prepared points.

It would have been an Emmy-quality TV performance had it only come three weeks earlier.

The choice of appearing only on CNBC was baffling as well. A Target spokesman pointed out that it chose CNBC in part to get snippets of the interview broadcast on other, more widely watched NBC-affiliated programs. But CNBC is a cable channel for investors, leaving the impression to some that Target valued them over customers.

It’s more likely that deciding to let the CEO appear only on a financial cable TV show is just another version of playing it safe, much like taking four days to prepare before publicly confirming a security breach.

The hole that Target finds itself in today is pretty steep, but in the case of other retailers that have been victims of this kind of hacking, the customers over time did forgive and come back. It’s important to remember, however, that during the holiday season, Target had challenges far beyond losing customer data to some crooks, as comparable-store sales grew at half of 1 percent at U.S. stores through the first nine months of the fiscal year, and store traffic has been falling.

It doesn’t seem like it’s the right time for Target to play anything safe.

 

lee.schafer@startribune.com • 612-673-4302

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