You’ve got to hand it to TJX- they know how to merchandise. Late Friday night, after sundown on Yom Kippur to be exact, TJX made the announcement of the settlement agreement for their customer class action suits. In retail delivery, timing is critical and TJX has taken that message to heart. Tired of the constant negative PR, TJX decided to slip this announcement in at a time when it would get the least notice and press play.
Yes, TJX has come to a settlement: three years of credit monitoring to those consumers whose personal information such as driver’s licenses and Social Security numbers were stolen in the breach (455,000) and a $30 TJX voucher for those clients who can show that they lost time and money due to its data breach (e.g., those whose credit card numbers were breached, namely, 45.7 million consumers), and $6.5 million to the attorneys. You can read the full terms of the TJX settlement here. A voucher to get millions of customers into its stores to shop. How neat and clean for TJX. And with a voucher, either money is left on the table, or consumers end up spending more money in the store to realize the full value of the certificate. Some lucky consumers will even get two vouchers if they can prove their costs exceed $60. Vouchers to clear up lawsuits are frowned upon by consumer rights advocates because they can drive up sales; even while class action attorneys accept them eagerly because they pocket larger fees as a result. Note that attorney fees are not paid in vouchers; if they were, we’d quickly see an end to this settlement practice. But TJX driving up sales? Would they do such a thing? While they are “deeply regretful” about the harm they have caused their customers, this is a merchandising company who knows how to milk a data breach for every sales dollar.
To show just how very sorry they are, TJX will hold a three-day sale where all its merchandise will be discounted 15% and guess what? Everyone is invited. You just can’t buy advertising for a sale like this. TJX’s 15% off three day sale will be run in every major newspaper for FREE. Whichever marketing genius thought up this one ought to win the Marketing Excellence Award this year.
Oh yes, and about that computer intrusion? TJX announced that it never will disclose the pesky details of the intrusion. After all, that was long ago and what good would that do? These costs were already accounted for under its set aside of $108 million after tax last quarter.
Guess I’ll be seeing at least 45.7 million of you at the “So Sorry Sale.”