In the April 12 entry on the fine StorefrontBacktalk blog, Evan Schuman points out that, while many consumers may say they have concerns about identity theft, their actions suggest an altogether different reality.
Case in point, according to Mr. Schuman, is TJX Cos. The owner of T.J. Maxx, Marshalls, HomeGoods, A.J. Wright and Bob's Stores just reported an 11 percent increase in revenues despite being victimized by thieves in what may turn out to be the largest data breach in retailing history.
Consumers' apparent indifference to TJX may be due, in part, to the belief that zero liability plans leave them immune to any real financial hardship if their credit cards are stolen, according to Mr. Schuman.
So what about consumers who say they would take their business elsewhere if a merchant is not able to keep their personal information secure?
"People make decisions about survey answers in a hypothetical ideal state," Mr. Schuman wrote. "Indeed, they may like to say that they would never frequent such a merchant. But when they need clothing for their child and there's this awesome sale at T.J. Maxx two blocks away, the platonic ideal of punishing reckless security deployments pales in comparison to finding jeans that fit well at a good price."
Mr. Schuman also sees another potential downside to the financial results posted by TJX.
"Large retailers are watching the TJX case very closely and they are going to learn some very bad lessons," he wrote. "They already assume that they probably won't get hacked and that if they do, it won't be bad. And if it is bad, they'll be able to keep it somewhat quiet. (Reality is not the exec's friend in these thought processes.) And if it does get out, what's the worst that could happen? TJX has gotten an avalanche of horrible publicity and their revenue grew 11 percent."
Discussion Questions: How do you explain the apparent indifference consumers have regarding the data theft at TJX? What (good or bad) lessons are there in the TJX case for other retailers?