When we released our predictions for Holiday Winners and Losers in November, Target was poised for a “win” in a not-so-robust, hyper-competitive season of shopping. With a nice mix of heavy-spending Gen X-ers as well as a base of those covetable Millennials, Target made an attractive value proposition to budget-conscious shoppers: discount shopping without feeling like you’ve shopped at a discounter. In addition, Target’s sought-after in-house brands and exclusive merchandise assortment likely helped the retailer keep at least a few eyes (and wallets) from wandering over to holiday’s biggest winner, Amazon.com.
Fast forward two months, and instead of touting a positive holiday season, Target is attempting to clean up one big mess. The Target name has now become synonymous with words like data breach, identity theft, and [lack of] financial security – a warning and case study for other retailers. But what has become of Target shoppers?
According to our intel gathered in the early weeks of January, three out of five shoppers (61%) who made a credit or debit card purchase at Target between November 27 and December 15, 2013, reported that they’ve been back to Target, seemingly strong vote of confidence. Just 7% indicated that they’ve switched over to a competitor. No big deal, right? Wrong. This seemingly minor 7% adds up to an estimated 4.6 million shopper surge out of Target stores. To put this in perspective, during Ron Johnson-era JC Penney, we projected that the ill-fated “Fair & Square” pricing strategy drove 1.3 million of their most loyal female shoppers in the all-important women’s apparel department out of its doors. So, yes, a 4.6 million shopper deficit in an already cutthroat retail climate is a BIG loss.
In addition, Prosper’s Shopper Security Score indicates that Target has a lot of work to do in order to win back customers. This new index gauges shopper trust in personal and financial security when making purchases at a specific group of retailers: Amazon, Best Buy, JC Penney, Kohl’s, Macy’s, Walmart, and, of course, Target. Among this select group of retailers, Target scores the lowest, a 66.5, compared to the group average (benchmarked at 100.0) – and 35% below competitor Walmart (104.5). Amazon certainly appears to be setting the standard for retail security in an increasingly digital age with a Shopper Security Score of 177.4. Among the department stores, trust is highest for Kohl’s (89.1), while Macy’s (83.3), and JC Penney (79.3) follow. While Best Buy continues to struggle, shoppers still seem relatively assured about making potential purchases, with the big box scoring a 99.8.
With loyal already hard to cultivate in the retail industry characterized by price matching, heavy promotions, showrooming, and, well, Amazon, it isn’t likely that the shoppers who left Target will just come back willingly once the dust from the data breach settles. In order to win these shoppers back, it’s imperative that Target first locate these shoppers, speak to them in effective, meaningful ways, and hope that these customers give them a second chance – another retail rarity these days.
This article originally appeared on Forbes.com.