advertisement
advertisement
advertisement

This is page 2 of:

Borders CRM Data Still In Play

July 21st, 2011

To a customer signing up for a loyalty program, that probably sounds pretty airtight—customer data is going nowhere without each customer’s express permission. Maybe Borders management actually believed that, too—after all, they launched the program in 2008, at a time when you had to believe a lot of impossible things to be in the big-box bookstore business.

But apparently the Borders lawyers didn’t mind contradicting faith with reality. Buried deep in the 3,500-word privacy policy is a none-too-surprising disclaimer:

Disclosures in connection with acquisitions or divestitures. Circumstances may arise where for strategic or other business reasons Borders decides to sell, buy, merge or otherwise reorganize its own or other businesses. Such a transaction may involve the disclosure of personal and other information to prospective or actual purchasers, or receiving it from sellers. It is Borders’ practice to seek appropriate protection for information in these types of transactions. In the event that Borders or all of its assets are acquired in such a transaction, customer information would be one of the transferred assets.”

In other words, the CRM data belongs to customers—until Borders is acquired, at which point it doesn’t. And that may be a problem, depending on how the bankruptcy court disposes of the information on what Borders says are 43 million loyalty-program customers. If that data is bundled with the Borders.com brand and relaunched as an online bookstore, or swallowed and digested by another bookselling competitor—say, Amazon (Borders’ former E-tail partner), Barnes & Noble (its biggest brick-and-mortar competitor) or some smaller bookseller, there’s not likely to be much more than grumbling from customers or consumer advocates.

But if the CRM data is sold off separately—or to a buyer who simply dumps the Borders brand and uses or peddles the Borders customer list—that could jerk the chains of politicians who are increasingly twitchy about customer privacy and especially information on book-buying behavior.

It’s the same sticking point that gave Amazon a courtroom win last year, in which the North Carolina Department of Revenue was blocked from getting data on what North Carolina residents bought from Amazon, so the state’s tax agency could try to collect sales tax on the purchases. And California is currently in the late stages of passing legislation to slap tight controls on getting access to the book-buying habits of customers without their explicit permission.


advertisement

Comments are closed.

Newsletters

StorefrontBacktalk delivers the latest retail technology news & analysis. Join more than 60,000 retail IT leaders who subscribe to our free weekly email. Sign up today!
advertisement

Most Recent Comments

Why Did Gonzales Hackers Like European Cards So Much Better?

I am still unclear about the core point here-- why higher value of European cards. Supply and demand, yes, makes sense. But the fact that the cards were chip and pin (EMV) should make them less valuable because that demonstrably reduces the ability to use them fraudulently. Did the author mean that the chip and pin cards could be used in a country where EMV is not implemented--the US--and this mis-match make it easier to us them since the issuing banks may not have as robust anti-fraud controls as non-EMV banks because they assumed EMV would do the fraud prevention for them Read more...
Two possible reasons that I can think of and have seen in the past - 1) Cards issued by European banks when used online cross border don't usually support AVS checks. So, when a European card is used with a billing address that's in the US, an ecom merchant wouldn't necessarily know that the shipping zip code doesn't match the billing code. 2) Also, in offline chip countries the card determines whether or not a transaction is approved, not the issuer. In my experience, European issuers haven't developed the same checks on authorization requests as US issuers. So, these cards might be more valuable because they are more likely to get approved. Read more...
A smart card slot in terminals doesn't mean there is a reader or that the reader is activated. Then, activated reader or not, the U.S. processors don't have apps certified or ready to load into those terminals to accept and process smart card transactions just yet. Don't get your card(t) before the terminal (horse). Read more...
The marketplace does speak. More fraud capacity translates to higher value for the stolen data. Because nearly 100% of all US transactions are authorized online in real time, we have less fraud regardless of whether the card is Magstripe only or chip and PIn. Hence, $10 prices for US cards vs $25 for the European counterparts. Read more...
@David True. The European cards have both an EMV chip AND a mag stripe. Europeans may generally use the chip for their transactions, but the insecure stripe remains vulnerable to skimming, whether it be from a false front on an ATM or a dishonest waiter with a handheld skimmer. If their stripe is skimmed, the track data can still be cloned and used fraudulently in the United States. If European banks only detect fraud from 9-5 GMT, that might explain why American criminals prefer them over American bank issued cards, who have fraud detection in place 24x7. Read more...

StorefrontBacktalk
Our apologies. Due to legal and security copyright issues, we can't facilitate the printing of Premium Content. If you absolutely need a hard copy, please contact customer service.