What happens when a company you trust has a breach in their security that compromises your account information, leaving you open for credit card fraud? How quickly does the trust fade? We have the benefit of watching two real-time case studies for this concept right now in the wake of the Target and SnapChat breaches.
There were two rather significant breaches of security over the holidays from two well-known brand names. These are hardly the first of these types of breaches, and sadly they are not likely to be the last.
First, there was the security breach suffered by Target, where transactions that took place between November 27, 2013 and December 15, 2013, were accessed and the card numbers and Personal Identification Numbers (PINs) were compromised for over 110 Million cardholders.
The second was when Snapchat, a social media site that is growing in popularity, had the user names and phone numbers hacked for 4.6 Million users, which were then posted on a website called, SnapchatDB for anyone to see on New Year’s Eve. Happy New Year indeed! While the SnapchatDB site has been taken down, the Debit Card and Credit Card information for Target is still out there.
Customer loyalty is what a great customer experience helps create. It is the standard by which all customer experience champions are measured and it is the reason that frankly any organization really gives a damn about their customer experience.
Customers give you their loyalty when they have a consistently good customer experience that meets or exceeds their expectations and appeals to their subconscious and emotional needs as well. They reward companies that handle these expectations and needs well with their return business. For as long as those expectations and needs are met or exceeded, then the organization can virtually count on these particular customers’ loyalty.
But Target is taking a beating in the court of public opinion immediately following the announcement of the breach. BrandIndex, which uses the responses of an online panel of 2.5 million respondents who weigh in on corporate reputations, said that initial findings show that Target’s brand suffered a 35-point decline in just one week.
Now the drop in points could be associated with the crime or it could be something else. One of the biggest complaints by consumers is that they feel that Target’s response is lackluster . The same complaint was uttered by SnapChat victims, who only got an apology a full-week later, when SnapChat finally fixed the problem in the system. At this point, it’s too soon to see what the long-term ramifications from these breaches will be to both of these brands’ customer loyalty. But lackluster is hardly the word I would want associated with my brand’s response to such a snafu if I was either of these two companies.
Abraham Maslow, American Psychologist born in Brooklyn around the turn of the century is famous for creating what we now call Maslow’s hierarchy of needs.
The familiar pyramid teaches us just about everything we need to know about Brand Loyalty.
Clearly on the Hierarchy, you can see that security and safety help form the foundation for a person’s needs. Maslow shows us that safety and freedom from fear are two of the most important needs a human being has, right after breathing and fresh water. When these needs are not met, then none of the higher levels can be addressed. In other words, Maslow says that if a person does not feel safe or free from fear, they cannot move forward.
At Beyond Philosophy we have a pyramid that we use a lot too.
Unlike Maslow’s, however, the Beyond Philosophy pyramid shows the Hierarchy of Emotional Value to a customer’s experience. This pyramid shows the 20 emotions that we discovered in our research that drive or destroy value in a customer experience. This pyramid shows us how emotions can generate dollars.
Using this pyramid, we can predict how the breach will affect the future business for both companies. As you can see at the top of the pyramid are the emotions of advocacy that include happy and pleased, which is an emotion I am willing to bet very few Target or Snapchat customers are feeling about those organizations right now. At the bottom are the emotions that destroy value for an organization and include the following: Irritated, neglected, unhappy, unsatisfied, stressed, disappointed, and frustrated. Now here’s a list that I can bet are familiar to customers that have suffered the recent breaches in their information. Since these are the destroying cluster emotions, dollars do not seem as likely for either company.
Both organizations are the victims here of a crime and it is not my wish to beat them up too much for it. As I said before, they are not the first, the last, or really even the worst. But victims or not, the crimes does interfere with the customers feeling of safety, which causes stress and frustration. And if you look at either of these two pyramids, that doesn’t bode well for customer brand loyalty.
For a more detailed explanation of these emotions and your emotional signature, please read our whitepaper called, “Emotional Signature® (ES) the role of emotions in Customer Experience.”
|Colin Shaw is founder & CEO of Beyond Philosophy, one of the world’s first organizations devoted to customer experience. Colin has been recognized by LinkedIn as one of the top 150 Business Influencers in the world. He is an international author of four best-selling books on Customer Experience. Colin’s company, Beyond Philosophy provide consulting, specialised research & training from our Global Headquarters in Tampa, Florida, USA.
Follow Colin Shaw on Twitter: @ColinShaw_CX