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Hackers hit Dairy Queen

BY CSA STAFF

Edina, Minn. – Payment systems at 395 Dairy Queen stores and one Orange Julius store across the U.S. have been hit by a cyber attack that exposed payment card customer names, numbers and expiration dates. The company has no evidence that other customer personal information, such as Social Security numbers, PINs or email addresses, was compromised as a result of this malware infection.

Hackers used the widely-reported Backoff malware that is targeting retailers across the country. The company previously indicated that it was investigating a possible malware intrusion with external forensic experts. The investigation revealed that a third-party vendor’s compromised account credentials were used to access systems at some locations. Parent company International Dairy Queen Inc. is working with law enforcement and independent franchise owner/operators of affected stores.

While precise timing of the intrusion varies by individual store, but the attacks took place between June and October 2014. Dairy Queen says the attack has been contained and it is offering free identity repair services for one year to customers in the U.S. who used their payment card at one of the impacted stores.

“We are committed to working with and supporting our affected DQ and Orange Julius franchise owners to address this incident,” said John Gainor, president and CEO of International Dairy Queen. “Our customers continue to be our top priority.”

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Amazon to Open Physical Store

BY CSA STAFF

By Mike Moriarty, A.T. Kearney

Well, well, well. Amazon is opening a store. Isn’t that nice!

Now, does that make the company an enormous on-line retailer with “a store”, or does it make Amazon a small to mid-sized retailer with an enormous online presence?

It almost doesn’t make any difference — and that in itself makes a difference. Welcome to planet Earth, Amazon!

Americans love to shop, they love physical stores and they love to shop online. But at the end of the day, 90% of purchases are made in a physical store, and — more importantly — 50% of purchases that are made online are made on a website of a retailer with a physical store.

Well, I guess that number just jumped up a little.

And even for those of us who discover, shop and buy online, two-thirds of us still go to a physical store to test and trial, return or something-something-something about our “online purchase”

It’s called omnichannel, and Amazon.com just pulled the plug on all those chicken-littles who have said the sky is falling on physical retail.
It’s no surprise that Amazon is opening stores. Shoppers love stores. We love the place, the discovery, the contact, the people, the convenience, the immediacy. And in a couple of years, we’ll love the history … “You know I shopped at the first Amazon.com store on 34th street in New York!” someone will say in 2064, when Amazon has more stores than [insert your favorite convenience or forecourt store here]

Now, it will be interesting to see what Amazon does with their new stores. If they are just metropolitan logistics points (pick up and return) that would be such a disappointment. It would be such a lost opportunity.

When Amazon.com created themselves, and re-created the way we shop, it was energizing, dramatic and exciting — and it still is. Even for those of us who are solid “feel it, see it, buy it” shoppers, there is no doubt that Amazon (and Alibaba, eBay, Etsy, etc., etc) has changed our lives for the better.

So now what? There are physical retailers that are also enormously successful with their online presence … Macy’s, Sephora. And there are previously only-online retailers who are opening physical stores at an amazing pace — Warby-Parker, Athleta … and now, Amazon.com.

Our shopping journeys take us all over the place — online, in store, social media, friends and family, in our car, on our phone; well, what goes around certainly does come around.

And amazon.com is certainly a goes-around/comes-around kind of company. Tremendously powerful, uniquely innovative. But it can be so much more. Think inclusion, value, and social redesign.

Think about it one more time: Inclusion, value, and social redesign.

Let’s hope that when amazon.com figure out what they want to do with their physical store spaces, that they continue to thrill us with access, insight and social redesign. Thrill us!

The message is not that amazon.com is opening a physical store — better not be! — the real message has to be that amazon.com is moving into a new place, with new ideas, and new solutions.

Mike Moriarty is a partner in the retail practice of A.T. Kearney, a global management consulting firm, and co-author of On Solid Ground, a study that looks at the role physical stores continue to play in the shopping experience. He can be reached at [email protected].


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Imports to set new record before holidays

BY CSA STAFF

Import cargo volume at the nation’s major retail container ports is expected to see a final surge and set a new monthly record in October as the holiday season approaches, according to the monthly Global Port Tracker report released late this week by the National Retail Federation and Hackett Associates.

“Increasing congestion at the nation’s ports as well as the ongoing West Coast labor negotiations are ongoing concerns and retailers are making one last push to make sure they’re stocked up for the holidays,” said NRF VP for supply chain and customs policy Jonathan Gold. “Retailers are working hard to make sure customers can find what they’re looking for regardless of what happens at the ports.”

Import volume at U.S. ports covered by the Global Port Tracker report is expected to total 1.53 million containers in October, topping the 1.52 million monthly record set in August. Cargo volume has been well above average each month since spring as retailers have imported merchandise early in case of any disruption on the docks.

The contract between the Pacific Maritime Association and the International Longshore and Warehouse Union expired on July 1, prompting concerns about potential disruptions that could affect back-to-school or holiday merchandise. Dockworkers remain on the job as negotiations continue but the lack of a contract and operational issues have led to record congestion at the ports.

The 1.52 million 20-ft. equivalent units handled in August, the latest month for which after-the-fact numbers are available, was up 1.5% from July and 2.1% from August 2013. One TEU is one 20-ft. cargo container or its equivalent.

September was estimated at 1.48 million TEU, up 2.8% from the same month the prior year, and October’s forecast of 1.53 million TEU would be up 6.4% from 2013. November is forecast at 1.39 million TEU, up 3.7%, and December at 1.37 million TEU, up 3.9%.

Those numbers would bring 2014 to a total of 17.1 million TEU, an increase of 5.3% from 2013’s 16.2 million. Imports in 2012 totaled 15.8 million. The first half of 2014 totaled 8.3 million TEU, up 7% from the previous year.

January 2015 is forecast at 1.42 million TEU, up 3.5% from January 2014, while February is forecast at 1.35 million TEU, up 8.5% from the previous year.

The import numbers come as NRF is forecasting 4.1% holiday season sales growth and 3.6% growth for 2014 overall. Cargo volume does not correlate directly with sales but is a barometer of retailers’ expectations.

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