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Industry Analysis Report

www.crimsonhexagon.com | 1.617.547.1072 | @CrimsonHexagon





Can You Buy Back Brand Equity?

By STACI AVERSA, Marketing, Crimson Hexagon

Targets 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 Targets 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
Targets 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 Hexagons ForSight platform, we analyzed the social conversation from December 18 to
January 21 to learn how consumers reacted to news of Targets security breach, and the retailers
response. What was the quantifiable impact on consumer confidence and the retailers 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 Targets damage control efforts and voicing their frustrations.






Industry Analysis Report
www.crimsonhexagon.com | 1.617.547.1072 | @CrimsonHexagon



Criticisms of Targets 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 23when 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 Targets 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.


Brand Impact
Before the incident, total negative opinion represented only a minute percentage of Targets 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 Targets brand-level conversation took an unfortunate 180 degree turn to
become 95% negative. Its clear that the security breach has affected consumers attitudes towards the
company on a wider scale.





Industry Analysis Report
www.crimsonhexagon.com | 1.617.547.1072 | @CrimsonHexagon






Through analysis of social media data, it is clear the PR efforts to date have done little to repair the
publics perception of Target.









Industry Analysis Report
www.crimsonhexagon.com | 1.617.547.1072 | @CrimsonHexagon





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 weve 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 Targets 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.


About Crimson Hexagon

Crimson Hexagon, founded in 2007, is the leading provider of analysis software that delivers
business intelligence from social media data for global corporations. Powered by patented
technology developed at Harvard Universitys Institute for Quantitative Social Science, the
Crimson Hexagon ForSight platform delivers the industrys most comprehensive Big Data
analysis capabilities for a variety of large-scale data sources. Clients include leading global
organizations such as: Microsoft, Samsung, Paramount Pictures, Starbucks, Twitter, and
many more. For more information go to http://www.crimsonhexagon.com.