Report: Target prices dropped 20% during breach
Ottawa, Canada - Target dropped prices on its monitored assortment by more than 20% during the days leading up to its confirmation of the data breach that compromised the security of 70 million customers’ personal information during the pre-holiday shopping season. According to data from 360pi analyzing approximately 830 products across eight categories, including TVs, tablets, digital cameras and more, Target dropped its prices by 18% between Dec. 14 and Dec. 17.
Prices continued to drop another 5% leading up to Christmas. In comparison, Walmart dropped prices by only 5%-6% during the same time period.
“Our data suggests that faced with a loss of customer trust, mounting inventory and a shrinking pre-Christmas shopping window, Target may have taken a dramatic price decrease approach to attract price-sensitive shoppers and minimize the impact of lower sales,” said Jenn Markey, VP marketing for 360pi. “It appears to us that this pricing strategy did not completely mitigate the financial impact of the breach, as Target’s fourth quarter profit decreased by 46% while Walmart’s fell only 21%.”