After alleged increase in organized retail crime, Target to boost investment in cyber capabilities

Target plans to invest in cybersecurity to prevent in-store retail theft, the company announced Sept. 26.

To protect stores against shrink, Target said it also plans to partner with the Department of Homeland Security.

The company intends to direct its cyber capabilities toward tracking “organized crime groups, tools, and services” as well as developing crime detection tools and tracking fraud through “data alerts and analysis.”

Retailers are increasingly looking to cybersecurity as a way to combat theft, combining it with physical measures. At the National Retail Federation’s (NRF) Protect conference in early June, Target VP of cybersecurity Jodie Kautt said the company is taking “mitigation or prevention steps to disrupt this activity right in line with the guest experience flow that the fraudsters are taking advantage of.”

Claims and allegations. Target will close nine stores in four states in late October, according to its statement, including locations in New York, Seattle, the Bay Area, and Portland, Oregon. Target made the “difficult decision” because “theft and organized retail crime are threatening the safety of our team and guests, and contributing to unsustainable business performance.”

If that sounds familiar, it should—Walgreens made similar assertions in 2021 when closing stores, only for the CFO to later walk back the claims in a January 2023 earnings call. In November 2022, Target CFO Michael Fiddelke alleged the company lost $400 million to theft in 2021, a number that does not appear to have been independently verified.

Target is pressing forward with its anti-crime measures. The company said that in addition to its cyber capability investments, it plans to implement “theft-deterrent” measures at stores, train staff to manage threats, and work with Congress to pass laws aimed at preventing retail crime.