news from the intersection of branding & technology

The Hacks Just Keep On Coming

In brand-building, Target, Yahoo! on February 1, 2014 at 2:28 pm

Yahoo! the latest victim of hackers

by Robert Liljenwall

hacked

Target, Neiman Marcus, Michaels and now Yahoo!  And God knows who else (there were supposedly six other retailers hacked but names have not surfaced). What is fascinating is that these are not just ordinary e-crooks – these are capable hackers who enjoy Breaking & Entering huge data files and walking off with millions of accounts that is sending shock waves through every retail and financial executive suite in the country.

What is ironic is that Jan. 27, Yahoo! Finance reported the hack of craft supply retailer Michael’s, only to discover two days later that Yahoo has also been hacked – and it has 273 million accounts worldwide, with a third in the United States. Yahoo is the world’s #2 email account provider after Google, and it has already issued a fix – change your password – and often. Yahoo declined to say how many accounts were compromised or provide a detailed description, although reports indicate it was for the US accounts only. But Yahoo was quick to state that they are investigating it. Really?

Yahoo maintains the breach was not on Yahoo’s systems but obtained from another party who did have access as a vendor account.

Meanwhile, back at Target, they have appeared before Congress – have reportedly lost more than $153 million in replacement costs for new credit cards … sales are down between 2.5 percent to 6 percent as a result of customers staying away … and employees have been laid off. Perhaps the most damning criticisms against the Target brand is that their CEO didn’t respond for nearly 30 days … had a lame offer of 10 percent discount on merchandise upon learning of the crisis … and have been fraught with missteps such as issuing partial statements only to have them revised later. A strong brand seemingly adrift.

Retailers are scrambling to strengthen their security programs, but hacked customers are not happy, regardless of how ‘nice’ the companies are in ameliorating the losses. Target asks you report it to your store, but they recommend you also file a police report. As one frustrated, hacked Target customer who had $2,700 unauthorized charges said … “why do I have to file a police report?  I don’t have time for that!”  The credit card company will reimburse him though. – RJL

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