Can You Buy Back Brand Equity?

Traget Brand Equity Breach
Target’s response to the credit card breach had some initial success, but more still needs to be done to change consumers’ perceptions.

Insights

  • Consumers take to social media to express their disappointment in how Target has handled the credit card breach.
  • Criticisms of Target’s crisis management nearly diminished when the store offered a storewide 10% “mea culpa” discount; however, the negative conversation quickly rebounds after the two-day offer expired.
  • General news sharing decreases over time in favor of negatively charged discussion related to Target’s damage control efforts. Overall, consumers become more outraged over the course of the month.
  • A small proportion of consumers explicitly state that they no longer trust the retailer and refuse to continue shopping at Target stores.

Context

During the 2013 holiday season, Target became one of several retailers to be targeted by hackers. Up to 40 million customers’ credit card information was compromised between November 27 and December 15. In an effort to appease frustrated customers, Target introduced a 10% discount at its stores during the weekend before Christmas. The retailer has since offered free credit monitoring services to customers.
Using Crimson Hexagon’s ForSight platform, we analyzed the social conversation from December 18 to January 21 to learn how consumers reacted to news of Target’s security breach, and the retailer’s response. What was the quantifiable impact on consumer confidence and the retailer’s brand reputation?

Analysis

Of the over 86,000 tweets, 55% are neutral mentions of the incident or news sharing. As we might expect, this category represents the largest percentage of the daily conversation when the news first breaks. This portion of discussion has dropped by 25% since December; it is now replaced with discussion criticizing Target’s damage control efforts and voicing their frustrations.
Criticisms of Target’s attempts to make amends with customers represent around 19% of the total social conversation and, over the course of the month, has increased by 34%. During the short period of time—most notably December 22 and 23—when Target offered customers an apologetic store discount, this percentage drops dramatically. Consumers responded very well to the offer.
However, this favorable mood shift was only temporary. In fact, the percentage of consumers complaining about their card being compromised rose immediately after the weekend discount ended, and has increased despite Target’s new offer of free credit reporting services. Though customers were temporarily relieved, the backlash has only grown– and with no remedy in place. In addition, 2% of conversation participants have explicitly stated they no longer trust Target and plan to abandon the retailer completely.
Opinion Analysis Brand Equity After Credit Card Breach

Brand Impact

Before the incident, total negative opinion represented only a minute percentage of Target’s social footprint. In fact, the entire online conversation about Target was 95% positive. However, following the announcement of the credit card breach, we uncovered one of the largest shifts in consumer opinion about a retailer to date, as Target’s brand-level conversation took an unfortunate 180 degree turn to become 95% negative. It’s clear that the security breach has affected consumers’ attitudes towards the company on a wider scale.
Through analysis of social media data, it is clear the PR efforts to date have done little to repair the public’s perception of Target.
Daily Opinion Analysis Brand Equity After Credit Card Breach
Through analysis of social media data, it is clear the PR efforts to date have done little to repair the public’s perception of Target.
Target Credit Card Breach Brand Equity Tweets

Action

Of the Target should focus on providing the type of value that customers want right now. Instead of focusing on a new credit monitoring initiative, which most users have not openly accepted, Target may have more success if it brainstormed new programs that add value to customers in-store. Customers responded well to the special store discount, but their gratification only lasted as long as the offer.
During a brand crisis, social media analytics is a critical tool to have in your consumer insights arsenal. Insights from social media can help businesses understand the consumer climate and the degree of confidence your customers have in your organization. As we’ve illustrated, social media can uniquely give you early insight into consumer distrust–even an abandonment trend– and it enables you to quantify how these sentiments impact your brand.
Though Target’s tactics to buy back brand equity showed early signs of success, the retailer was fated to fail as subsequent measures were not taken when conversations turned even more sour. Public relations is an artful vehicle for building (and repairing) brand equity, but companies today need to rely on more science to prove real effectiveness in changing consumer opinion.

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