The data breach that compromised 40 million payment cards used by Target (TGT) shoppers has cost banks and credit unions more than $200 million, based on estimates from industry trade groups.
The Consumer Bankers Association said Tuesday its members have incurred a total cost related to card replacements of $172 million, up from an initial projection of $153 million. Meanwhile, the Credit Union National Association believes the cost to its members has increased to $30.6 million.
Members of the trade groups have so far replaced 21.8 million of the 40 million credit and debit cards that were affected.
“Financial institutions of all sizes have been aggressive in ensuring their customers are protected in response to the Target data breach,” said Richard Hunt, president and CEO of the CBA.
Bill Cheney, president and CEO of CUNA, added the combined $200 million cost “shows the extent to which financial institutions will go to protect their customers and members.”
The estimates don’t include any fraud that may occur or has already been reported. Consumers are not held liable for any fraudulent purchases made with their credit or debit cards.
The attack on Target, which also exposed personal data connected to 70 million customers, reportedly began when hackers obtained credentials from a heating and air conditioning contractor that works on the retailer’s stores.
Shares were up 0.8% at $56.51 in recent trading.
In the great bull market of 2013, it wasn’t hard to be a stock picker — it seemed as if every stock, with the exception of a select few, was soaring to new heights. But of 2013’s many winners, Hewlett Packard was one name that seemed poised for a fall from grace in 2014. “I don’t know if there is a person alive who doesn’t expect there to be fewer printers sold next year and fewer PCs sold next year than last year and last year was terrible for them,” Jeff Middleswart, a senior analyst at Ranger International, told Forbes’ Sam Sharf in December.
However, after beating the Street with its first quarter 2014 earnings results — posting $28.2 billion in sales against a $27.2 billion consensus and earnings of 90 cents per share against an 85 cents per share consensus — Thursday afternoon, HP is now giving its skeptics some room for pause, and even leading some analysts, like Citi’s Jim Suva, to declare that HP could still soar in 2014.
“Although HP shares are up 8% this year (while the S&P 500 is flat) following last year’s 101% gain, we still see a 34% total return within the next 12 months and reiterate our Buy rating,” Suva writes in a new research report, adding that he sees 11 reasons why HP could continue to trade even higher. Chief among these reasons are HP’s stronger cash flows, earnings per share that are poised for growth and, most interestingly, HP’s potential to gain a foothold in the 3D printing landscape.
HP reported $3 billion in first quarter cash flows, a figure that Suva calls “a real surprise,” especially against sell-side analysts’ expectations of cash flows of $500 million to $1 billion. The $3 billion figure, Suva argues, “provides adequate funds for stock repurchase, dividends, and smaller strategic M&A,” which he predicts will come on the software and services side of HP’s business.
Though HP posted nine consecutive quarters of year-over-year earnings-per-share declines, Suva says that the 10% increase from the 82 cents per share in the first quarter of 2013 to the 90 cents per share reported for first quarter of 2014 gives reason to believe that HP’s EPS will continue to grow. Suva points out that the PC maker raised the low end of its full-year 2014 EPS outlook to $3.60, up from $3.55, while Citi Research predicts full year EPS will come in around $3.80 thanks to cost-cutting, stock buyback and improved PC and printing trends. Take this prediction with a grain of salt, though: Suva admits that the $3.80 figure is the highest on the Street.
Most of Suva’s other reasons outlining why HP stock could continue to climb this year are relatively tame — investor sentiment on both PCs and the printing landscape is too negative, revenue declines are slowing, HP management is regaining credibility, its multiple is poised to increase and a hefty buyback could boost investor sentiment — but his last reason echoes a December report from Jefferies in predicting that HP, bellwether of the old-school printing industry, could eventually prove to be a worthy competitor in the new-school world of printing: 3D printing.
“At HP’s Security Analyst Meetings on October 9th, the company commented that it is assessing the 3D printing market. We did not give much weight to the comment as our experience recalls that HP was in a partnership with 3D printing maker Stratasys back in 2010 and this effort was largely unsuccessful,” Suva writes. “However, we recognize the 3D market is gaining traction in recent years and on the HP earnings call the CEO stated that HP will enter the 3D market [this fiscal year] via internal investments.” Citi Research is not building any revenue from 3D printing into its HP revenue model, which means that any meaningful sales from a 3D printing initiative would be, essentially, a pleasant surprise.
Whether or not HP actually makes any money from its 3D printing efforts, the stock stands to benefit. 3D printing stocks have proven to be popular with investors: 3D Systems DDD -6.56%, the leader of the group, is up 120% year over year; Stratasys is up 92% and ExOne is up 77%. If HP were to really make a splash in the 3D printing industry, it could very well see some of that favoritism extended to its own shares.
According to a recent informal survey, financial institutions will be seeking to improve their customer experience, reduce overall costs and stand out from the competition by integrating unique delivery channels, offering mobile solutions and learning from big data in 2014. The recurring theme in 2014’s marketing trends is information – how it is curated, viewed and analyzed.
Content Marketing Builds
Visibility, Trust and Loyalty
Content marketing — also commonly referred to as “inbound marketing” — is the strategic creation and targeted distribution of media to acquire and retain customers. For financial institutions, content marketing is key to attracting and maintaining consumers by integrating multi-channel approaches such as affiliate marketing, direct mail, display advertising, email marketing, search engine optimization and marketing (SEO/SEM), blogging, social media marketing and more. Typically, these strategies are intended to drive individuals to a specific landing page, blog or corporate site. Whether generating new content or leveraging existing content, financial marketers must plan, create, place, audit, measure and adjust content accordingly.
Financial marketers will be accountable for analyzing the real results of content marketing strategies in 2014. Because every channel ultimately affects all of the others, attribution modeling allows marketers to credit a specific ad or touch point along a sales funnel rather than just the last material viewed or clicked. By looking at the historical big picture of a sales funnel, financial marketers can make better recommendations on the proper mix of tactics in subsequent content marketing plans.
In 2014, bank and credit union marketers must increase and improve their content marketing efforts by developing compelling, branded campaigns that tap into the frequently elusive Gen-Y segment. This means reinvesting in social media and email marketing to engage millennials in the manner they prefer to be reached: online.
Enhances the User Experience
Mobile optimization will continue to be at the forefront of digital strategy for banks and credit unions. With tablets on track to outsell desktop computers and laptops in 2013, mobile Internet usage will overtake desktop Internet usage in 2014. Furthermore, 99% of smartphone owners use their mobile browser at least once a day.
While most Internet users in the United States still prefer online banking for managing personal finances, mobile banking is catching on with consumers. About 94% of users in all age groups use online banking and approximately 71% of respondents ages 18-60+ have signed up for mobile banking, according to Celent’s research.
Big Data Realizes
Value by Analysis
As financial marketers work to deliver mobile-friendly, integrated content marketing experiences, information about consumers engaging with the brand will become more and more abundant. Commonly called “big data,” it is the collection and analysis of large, complex quantities of marketing information. Financial marketers will need to figure out how to use big data marketing tools to capture, curate, store, search, share, transfer, analyze and visualize these massive data sets into usable information to better engage consumers.
Financial marketers can create new connections for banks and credit unions by understanding big data applications based on the following consumer information:
Mobile and Data
Bank and credit union marketers will use these evolving digital strategies to benefit banks and credit unions — content, mobile, and data. Interestingly, these three points of emphasis all intersect. Content marketing is most effective when all integrated marketing channels are accessible in a mobile-friendly format. Mobile optimization is necessary for content viewing and engagement on consumers’ preferred devices. Mobile advertising, such as display and search ads, as well as email and landing pages, is integral to a sound content marketing strategy. Big data analyzes how and when customers/members interact with content along various channels and mobile devices. This valuable information is then leveraged to inform subsequent tailored content — special offers, contextual ads, personalized alerts — to members most often via a mobile device.
For banks and credit unions to attract and retain new customers/members and build brand loyalty, marketers must successfully serve up content on mobile devices while analyzing and leveraging the data for improved brand engagement. The year 2014 will see financial marketers combine content marketing, mobile optimization and big data in an actionable, cohesive digital strategy for banks and credit unions.
New businesses are feeling more confident and willing to hire, a good sign for the economy’s future.
According to the fourth-quarter survey of new business founders released by the Kauffman Foundation and LegalZoom, 91% of business owners are confident that their companies will be more profitable in the next 12 months, up from 86% saying that in the third quarter. Readings on the outlook for the overall economy and consumer demand also improved.
With more customers expected, start-up founders plan to add staff. According to the survey 43% of respondents plan to hire more employees, up from 36% saying that in the third quarter.
While the Kauffman/LegalZoom survey is only two years old, the increase in its employment index echoes the gain in hiring plans reported by the National Federation of Independent Business, a small-business trade group. The advances suggest small firms will take a larger role in adding jobs.
What do you want to invest in: stocks, bonds, mutual funds? Do you want to open an IRA or buy an annuity? Does your employer offer a 401K? Remember, every investment involves some degree of risk. Most securities are not insured by the Federal government if they lose money or fail, even if you purchase them through a bank or credit union that offers Federally insured savings accounts. Make sure you have answers to all of these questions before you invest:
• Define your goals. Ask yourself “Why am I investing money?” Maybe you want to save money to purchase a house or to save for retirement. Maybe you would like to have money to pay for your child’s education, or just to have a financial cushion to handle unexpected expenses or a loss of income.
• How quickly can you get your money back? Stocks, bonds, and shares in mutual funds can usually be sold at any time, but there is noguarnatee you will get back all the money you paid for them. Other investments, such as limited partnerships, often restrict your ability to cash out your holdings.
• What can you expect to earn on your money? While bonds generally promise a fixed return, earnings on most other securities go up and down with market changes. Also, keep in mind that just because an investment has done well in the past, there is no guarantee it will do well in the future.
• What type of earnings can you expect? Will you get income in the form of interest, dividends or rent? Some investments, such as stocks and real estate, have the potential for earnings and growth in value. What is the potential for earnings over time?
• How much risk is involved? With any investment, there is always the risk that you won’t get your money back or the earnings promised. There is usually a trade-off between risk and reward: the higher the potential return, the greater the risk. The federal government insures bank savings accounts and backs up U.S. Treasury securities (including savings bonds). Other investment options are not protected.
• Are your investments diversified? Some investments perform better than others in certain situations. For example, when interest rates go up, bond prices tend to go down. One industry may struggle while another prospers.
• Are there any tax advantages to a particular investment? U.S. Savings Bonds are exempt from state and local taxes. Municipal bonds are exempt from fedeal income tax and, sometimes, state income tax as well. For special goals, such as paying for college and retirement, tax-deferred investments are available that let you postpone or even eliminate payment of income taxes.
By Matt Sonnhalter, Vision Architect, Sonnhalter
I attended the 66th International Air Conditioning, Heating, Refrigeration Exposition in New York City (January 21-23, 2014). For those not familiar with this trade show, it is the largest HVACR show in the United States, endorsed by 33 leading HVACR industry associations and co-sponsored by ASHRAE and AHRI. This year’s attendance was once again very strong, with more than 61,000 people attending and more than 1,800 exhibitor booths.
Here are five of my observations from the show:
Strong 2014 Outlook – in addition to the positive sentiment of almost everyone I spoke with at the show, the recent ASHRAE/AHR Expo survey forecasts a pretty good year for the HVACR business. Of the 1,000 HVACR manufacturers worldwide surveyed, 79% of the respondents said their prospects for business were either “excellent” (19%) or “good” (60%) for the coming year, 90% of the HVACR manufacturers believe sales will increase and hospitals/healthcare, light commercial and data/telecom centers were the top three market segments identified to be the most promising for 2014.
Trade Publications Are Not Dead – 35+ publications had a presence at this year’s show, each with their army of sales people combing the aisles for new and potential advertisers.
Technology Continues To Play Strong Role – it seems every year at this show more and more technology is introduced to the products and services showcased, whether it is the software driving these products or the tablets used to control and monitor them. Again this year, there was a dedicated AHR Expo app for the show which not only helped you find your favorite booth, but also had valuable information about the speakers, educational sessions, transportation and local NYC attractions.
Growing International Attendance – exhibitors from more than 30 countries attended the show. Asian manufacturers have been coming to this show for a number of years and 2014 was no different; however I did notice an uptick of Latin/South American as well as European exhibitors and attendees this year.
“Efficiency” Is Still The Buzzword – with the way the economy has been over the last few years I think we have all gotten used to “doing more with less.” In the HVAC market that is nothing new, no matter which aisle you walked down during the show “efficiency” rang out in booth messaging, product benefits and sales pitches.
Google’s $3.2 billion acquisition of Nest, creator of the smart thermostat and smoke detector, caught many industry watchers by surprise.
But Google’s move to snap up one of the leading companies in the nascent field of devices that are paving the way for the “Internet of Things” is only surprising if you don’t know what Nest is all about.
For the uninitiated, Nest is a company devoted to making everyday household objects smarter through advanced design and Internet-enabled features.
Nest CEO Tony Fadell, a former Apple employee who worked on the original iPod, refers to this dynamic as “the conscious home,” an environment in which nearly every formerly mundane and passive device suddenly becomes as advanced and upgradeable as your smartphone.
Currently, the company’s two flagship devices are the Nest Thermostat ($249) and the Nest Protect ($129), a smoke and carbon-monoxide detector.
The thermostat can be remotely set via your smartphone or tablet to automatically adjust to a particular temperature. It also connects to Wi-Fi to analyze and compare the outside weather with your indoor environment in real-time. The thermostat even has a sensor with a 150-degree range to detect when you’re not home, so it can adjust the temperature accordingly, and save energy.
Nest’s smoke and carbon monoxide detector offers a similar set of Internet-control functions and color-coded alerts. It includes voice alarms, as well as the ability to control the device using hand motions. For example, when the battery is running low, the device will begin to pulse yellow; if the alarm goes off, you can wave your hands within eight feet of the device to shut it off.
As last week’s International CES showed, there are dozens of companies clamoring to snag a share of the emerging smart-appliance market. Indeed, the market is poised to grow rapidly, exceeding 24 million units by 2017, according to ABI Research.
Some recent standouts in the field include the August smart lock, Philips’ smart light bulb Hue and Samsung’s T9000 Refrigerator, but so far Nest appears to have gained the most traction. Enter: Google.
Unlike Google’s acquisition of robotics company Boston Dynamics, another next-gen hardware venture, Nest is bleeding-edge tech that is available as a mainstream product right now — not 20 years from now. In that respect, the Nest acquisition is far more similar to Google’s recent $12 billion purchase of Motorola Mobility.
But while that deal may have helped better position Google within the highly competitive and fragmented mobile-device space, the Nest acquisition immediately puts Google in the lead position in the emergent category of smart appliances for the home. The company has yet to reveal its sales numbers, but according to some reports, Nest is shipping up to 50,000 smart devices per month.
Following news of the acquisition, several industry observers jokingly speculated about what the acquisition will mean for Nest.
Will you have to log into Google+ to activate your smoke alarm? Will audio versions of Google’s paid search advertisements blare throughout your home via the speaker of your carbon-monoxide detector? Some are even wondering if you’ll be able to use the voice-control functions in Google Now to turn your heat or air conditioning on via the device.
Google’s statement announcing the deal indicates that Nest will continue to operate as a separate and distinct company under the leadership of Fadell, hinting that many of the aforementioned fears may be overblown.
However, it’s a sign of just how powerful a combination Google’s software and Nest’s hardware represents when even casual observers can imagine such scenarios that, in reality, would not be that difficult to execute on Google’s part.
If, in the future, Google does decide to integrate its powerful data-crunching powers with Nest’s well-designed hardware, the lure of such data-rich, smart home appliances just might be too tempting for many to resist — despite possible privacy implications.
And although Google is currently engaged in a good deal of bleeding-edge research as it bets on the future, its acquisition of Nest is not about experimentation — it’s about the next frontier that’s right at your fingertips: home.
This time of year your furnace seems like it’s running 24/7. You want the security of knowing your family’s home is snug and safe.
This is also the time when disreputable furnace repair services and chimney inspectors prey on your concerns for the safety of your property and family. Often these disreputable operators use fear to convince you that your heating system is in dire need of repair or replacement and you must make a major investment before misfortune or tragedy strikes.
In today’s world, with more than one-third of Americans using fireplaces, wood stoves and other fuel-fired appliances as heat sources in their homes, we often hear about such tragedies in the news and seek to prevent them.
According to the U.S. Fire Administration, heating fires account for 36% of residential home fires in rural areas ev ery year. Often these fires are due to creosote buildup in chimneys and stovepipes, and are preventable.
This is where the unscrupulous prey on the well-meaning homeowner. Forexampl, scam artists may offer a chimney inspection at an exceptionally low price, and once in your home, make bogus claims, warning of an imminent possibility of house fire or carbon monoxide leaks. Expensive repairs that must be done immediately, they say. They work to create a frightening sense of urgency with threats designed to spur you into action.
For real peace of mind regarding your hoem’s heating system, we offer these tips:
• Before you schedule an inspection, make sure the business is registered with the state.
• To protect your home and furnishings, in case of an accident, ask them to furnish proof of valid liability insurance.
• Check www.bbb.org for the company’s Busienss Reviw to see if there are any unanswered consumer complaints.
Furnace Maintenance Fraud
Another favorite scam disreputable businesses may use is to claim a furnace is “faulty” or “dangerous,” again using fear to pressure consumers into an expensive replacement.
In this scam, a furnace maintenance technician often claims that there is a crack inside the furnace that makes it dangerous to operate and presents a fire hazard.
To further heighten your apprehension, they may even turn the furnace off, recommending you keep it off unless it is replaced. often times, if you purchase a new furnace through them within a given “special promotional” time period, they offer to waive the cost of the inspection and maintenance.
Have the furnace inspected immediately by a qualified professional if you or your families are suffering from headaches, a runny nose, or watery eyes. Watch for a buildup of soot around heat registers and the furnace itself, or carbon monoxide detectors being set-off.
• If repairs are suggested, ask for photo/video proof of the recommended repairs. Ask for photos with enough background so that you can clearly tell that they were taken in your home.
• If you are told a component of your home heating system needs repair or replacement, get a second opinion and several bids. Do not feel pressured. Avoid agreeing to same day installation.
• If they show you debris and rubble, ask to see what is broken or collapsed. If they can see the damage so can you!
• Before the service person arrives educate yourself about repairs of furnaces, fireplaces and chimneys. For example, a single wall stainless steel liner is actually more durable and corrosion resistant than a studier-sounding double wall liner.
Call the BBB for the company’s Business Review.
At conversions. Email rocks at conversions.
And despite all the hype associated with Facebook and Twitter, and massive amount of funds that most companies have allocated to social in their quest for magical money, sadly the impact on economic outcomes remains disappointing.
In fact email conversion rates are nearly 40 times (!) that of Facebook and Twitter.
While Google+ was not covered in the study, it is likely that it delivers similar outcomes.
Lesson number one… Social is a terrible channel to pimp yourself and expect short term rewards in revenue or profitability terms. It is completely irrelevant, COMPLETELY, what your friendly neighborhood Social Media Guru says.
If your boss/spouse/angel believes the Guru, send them this post. It is on LinkedIn. It should carry a lot of authority. :)
Lesson number two… Email only works for people who understand the pure essence of permission marketing. It only works for people who execute a fabulous frequency (how often), recency (gap between two touch-points) and relevance (giving a lot of value in exchange for the occasional ask) strategy.
Oh, and it is incredibly measureable. As your chase shiny objects, don’t forget the original platform that empowered you to build sustainable relationships and owned audiences. #emailrocks
Lesson number three… Social was never meant to be a conversion driving channel. It was always silly to believe that pimping your company’s products and services on Facebook would lead to short-term revenue - but the social ecommerce hype was/is too strong.
The See-Think-Do content, marketing and measurement model dictates that social media platforms are fantastic at See and good at Think. But they massively stink at Do.
The reason is simple: Intent.
You don’t go to social platforms to buy, and only extremely rarely to research. You are there to reach out to people you have real (or fake!) relationships with, you are there to get updates on your digital or real world existences, and you are there to be entertained.
=Brands can win on social platforms if they understand why you are there. If they provide you with entertainment, if they provide you with information you can share with your circles, and if they behave in an authentic manner they can earn a tiny smidgen of your love and attention (brand equity).
All that can translate into revenue over a long period of time. When you the customer are ready, not when the company is ready (Now! Now! Give me your money now!!!!).
The two questions the company should ask itself:
Are we inherently social?
Do we have the patience to invest in relationships now to build our brand equity on social platforms?
If the answer to both questions is yes, do social. If the answer to one or both questions is no, stay home. Your company is not going to go bankrupt because it does not do social.
If 2013 was all about preparing for the launch of the health-care exchanges, the new year will undoubtedly be about navigating them. But the health reform isn’t the only change coming to the industry in 2014. From increased access to health information to technology playing a larger role in your health, here’s a look at trends consumers will likely see next year.
The advent of high-deductible health insurance plans means consumers are responsible for more of the health-care costs making it in their best interest to stay healthy and up to speed on their treatment option to make the best care choices.
“Regardless of where you get your health insurance from, there will be more of a focus on helping people improve their health and giving them more information,” says Amy Bergner, managing director, health care and benefits, at PricewaterhouseCoopers. She says consumers will have more access to information about different services and treatments, including cost, effectiveness and evaluations of different doctors and hospitals.
Berger also says companies and health insurance providers will place a greater emphasis on wellness programs and tying incentives to stopping certain unhealthy behaviors like smoking. “There will be more incentives toward healthy behaviors and more programs available to help people.”
Pain Medicine Management
Addiction to pain medication is a major epidemic plaguing the U.S., a trend professionals are hoping to reverse in 2014. According to survey conducted by the Institute of Addiction Medicine, more than two million Americans are opioid dependent. What’s more, about 4.7 million teenagers and adults say they’ve used opioid prescription painkillers for non-medical purposes and around 32.7 million Americans report having used opioid prescription painkillers for nonmedical purposes at least once in their lives.
“Opioids are frequently prescribed for post-surgical pain management, but a real risk exists for patients to develop dependence and addiction,” says Theresa Bowling, vice chairman, department of Anesthesiology at The Stamford Hospital. “Many hospitals are implementing narcotic reduction programs that use alternatives to opioids for post-surgical pain management.”
According to Bowling, patients should expect to see hospitals increasingly embrace alternatives to pain management. One option patients may see more of is what Bowling describes as “continuous nerve blocking” that numbs an affected area by delivering a continuous, regulated flow of a non-narcotic, local anesthetic through a catheter near the nerves that transmit pain from the surgical incision site.
“Portable and disposable delivery systems allow patients the option of recovering from their surgery in the comfort of their home without using potent narcotics for pain management,” she says. “Other benefits of avoiding narcotics in the management of post-surgical pain are eliminating the side effects associated with narcotics including nausea and vomiting, sedation, and itchiness.”
Overworked Doctors face burnout
The Affordable Care Act is designed to bring thousands of new patients into the health-care world, which could be taxing to physicians. As a result, Tom Doerr director of innovation research for Lumeris, a technology and consulting services provider for health systems, says there will be an increased risk of physician burnout in 2014.
“Research continuously shows primary-care physicians are more dissatisfied with their careers than ever,” says Doerr, noting that the structure and incentives of today’s health system aren’t aligned to engage and respond to the needs of the doctors.
Telehealth Goes Mainstream
Technology plays a role in pretty much every aspect of our lives, and our health is no exception.
According to Roy Schoenberg, chief executive of telehealth technology company American Well, 2014 will have more doctors using technology to follow up with their patients. He says doctors’ realization that telehealth offers a low-cost and convenient way to stay on top of their patients will spur the increased use of telehealth.
But it won’t stop with the doctors. Even non-medical companies will embrace telehealth to market to customers. “Retailers [supermarkets, pharmacies, hotel chains] will offer their visitors onsite access to medical services using a combination of onsite nurses and telehealth-based physicians,” he says. “These services will anchor initiatives that help retailers partner with their consumers towards leading and consuming products associated with healthier lifestyles.”