Alexa Sizzles, Etsy Fizzles And Data Security Eyes A Legislative Leap Forward

Fizzle Of The Week: No More NYC Amazon HQ


Alexa: Users are spending more, and they seem to like doing it, as evidenced by stickiness. A new study reports that Amazon Echo users are boosting their buying by double-digit percentages depending on the goods. Diapers are a hot seller, up 13.5 percent in the third quarter from a year ago. Upsell rates are gathering steam, up 60 percent year over year, as consumers continue to buy from the same brand, leveraging Echo.

Chip-enabled transactions: Still seeing a steady march of acceptance in the United States. EMVCo says that 59 percent of card transactions are done through EMV chip cards globally. That’s up from 42 percent last year. The U.S. leads the pack on growth, up 7 percent year over year.

Meal kits: In an industry that has seen its shares of fizzles and busted IPOs — namely Blue Apron — Walmart has been selling out of some of its meal kit offerings under the Takeout Kit and Home Chef brands. The company now has 30 meal kits available through its site, a respectable entry into a market that is estimated to be worth as much as $2 billion annually.



Porch pirates: Grinches that grab from the gifted are grubbing. Old-fashioned physical robbery is on the rise, as security firm Ring finds that as many as 20 percent of eCommerce shoppers have been the victim of porch piracy. Hide those Amazon packages, folks, or just about anything that looks like it might be full of electronics or something pricey.

Ken Chenault’s view of banks: Amex’s Ken Chenault’s parting shot to the industry was to say that IPO-ing joint ownership of Visa and Mastercard created competitive disadvantages, as the short-term (trading) gains led to longer-term losses, namely in terms of data and merchant relationships. He said to count among the losers JPMorgan Chase, Bank of America and other heavy-hitters. We think they beg to differ.

Etsy: Gets an etsy-stential threat from Amazon. Amazon Handmade will be teaming with Prime to get local art and artifacts into the hands of consumers with speed into an extended holiday selling season. Time is of the essence, it seems.


Sizzle of the Week: Consumers 

“It’s not the crime; it’s the cover-up.”

An expression popularized during Watergate has managed to gain new relevance in the era of data breaches and executives that may try to hide them from the customers (and regulators) they serve.

The most recent example is, of course, Uber, who told the world on the eve of Thanksgiving that they had been hacked and that the personal data of 57 million customers and drivers was compromised — in October 2016.

At the time, Uber — at the directive of its chief security officer — hid the breach and paid hackers about $100,000 from a bug bounty fund to destroy the data.

“None of this should have happened, and I will not make excuses for it,” new CEO Dara Khosrowshahi said in an emailed statement. “We are changing the way we do business. While I can’t erase the past, I can commit on behalf of every Uber employee that we will learn from our mistakes.”

Uber may be the flashiest and most recent example, but they are not the first firm in history to hide a data breach — or at least report it as slowly as possible. Equifax was hit with what will likely be ranked as the breach of the year (or maybe even the century), which saw the personal data of 160 million (essentially the entire U.S. adult population) consumers lost to hackers who managed to access their system. Stolen information included names, Social Security numbers, birth dates, addresses and, in some instances, driver’s license numbers.

The company also reported that 209,000 U.S. consumer accounts were accessed by the hackers, as well as certain dispute documents with personal identifying information for approximately 182,000 U.S. consumers.

The massive data breach was discovered by Equifax on July 29th, but the company didn’t reveal the hack until 41 days later. During that time, it was also discovered that four Equifax executives sold stock a few days after the breach, but long before news of the breach was made public.

Those four execs — one of whom was Equifax’s CFO John Gamble — and the collective $1.8 million they made on the sale triggered an investigation by the Department of Justice. A special committee established by Equifax to investigate the sale cleared all four executives of any wrongdoing, finding that pre-clearance for the trades was appropriately obtained and that the timing was just a very unfortunate coincidence. The Justice Department’s investigation continues, however.

These two incidents, when taken together, were enough to prompt Senate lawmakers to propose legislation that would make it a crime, complete with jail time if found guilty, to hide a data breach from the public.

This sort of legislation is not entirely unprecedented. There is currently a patchwork of state laws in place that make it illegal to hide a data breach. But the proposed Senate bill would make it a federal crime and put executives who fail to report known breaches within 30 days in jail for attempting a cover-up.

The move also comes as consumer faith in corporate America’s ability to protect their data is hitting an all-time low.

According to a Ponemon Institute study conducted across the U.S., the U.K., Germany and Australia, 62 percent of consumers were notified by a company or government agency when their personal data was lost or stolen as a result of one or more data breaches. Of those, 36 percent said they had experienced two or more separate incidents.

When it happens, consumers vote with their feet — or bank accounts. Twelve percent of those surveyed said they ended their relationship with the company that experienced the data breach.

Whether this law will pass remains an open question. Similar legislation was proposed in the wake of the Target breach four years ago, and, after an initial burst of enthusiasm, it didn’t really go anywhere.

But then, that was before a single breach had managed to compromise most Americans’ data — or before they found out that America’s favorite ridesharing service went out of its way to actively conceal a data breach for over a year.

So, this week it just might be a sizzle for consumers.




The pressure on banks to modernize their payments capabilities to support initiatives such as ISO 20022 and instant/real time payments has been exacerbated by the emergence of COVID-19 and the compelling need to quickly scale operations due to the rapid growth of contactless payments, and subsequent increase in digitization. Given this new normal, the need for agility and optimization across the payments processing value chain is imperative.