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Breaking: MasterCard Warns Of Possible Security Breach, Visa Also Reportedly Affected


 

DEVELOPING:  MasterCard is reportedly investigating a possible breach of cardholder account data involving a U.S.-based payment processor, the company said Friday.

The Wall Street Journal reports that the Purchase, N.Y., credit-card company said law enforcement has been notified of the matter and an “independent data security organization” is conducting an ongoing forensic review.

The company is alerting card-issuing banks regarding “certain MasterCard accounts that are potentially at risk.”

“MasterCard’s own systems have not been compromised in any manner,” a company spokesman told the newspaper.

The spokesman declined to say how many cards may have been compromised or how many banks it is notifying.

The breach was first reported early Friday by Krebs On Security, a blog by former Washington Post reporter Brian Krebs. The blog also reported that Visa was also notifying banks about a breach involving a third-party payment processor.

Representatives for Visa couldn’t immediately be reached for comment Friday morning, the Wall Street Journal reports.

Visa and MasterCard do not lend or issue cards to consumers, but instead process transactions for banks that issue their cards and those that handle transactions for merchants.

Representatives of several banks, including Bank of America Corp. and J.P. Morgan Chase & Co., either couldn’t be reached for comment or declined to comment Friday morning, the newspaper reports.

MasterCard said it will “continue to both monitor this event and take steps to safeguard account information.”

Cardholders concerned about their accounts should contact the banks that issued them their cards, MasterCard said.

Click here for more on this report from The Wall Street Journal.

via MasterCard Warns Of Possible Security Breach, Visa Also Reportedly Affected | Fox News.

Nestle bites into luxury chocolate market


A hostess holds a Chocotaster box, which Swiss customers can order online from Maison Cailler, a brand of food giant Nestle.

A hostess holds a Chocotaster box, which Swiss customers can order online from Maison Cailler, a brand of food giant Nestle.

DENIS BALIBOUSE/REUTERS

Dermot Doherty The Washington Post

GENEVA—Nestle, known for mass-market chocolates like the KitKat bar, is trying to get a bigger piece of the growing market for fancier sweets. Its idea: customized confections.

Internet shoppers in Switzerland and Liechtenstein can order a Maison Cailler taster pack with five kinds of chocolate. After completing an online survey to determine a “chocolate personality,” recipients get a bigger box with flavours and cocoa content selected for those particular taste buds.

Luxury products can succeed even amid the economic downturn, said Laurent Freixe, head of Nestle’s European business. Global sales of premium chocolate are growing faster than the overall market and may be worth about $8 billion (U.S.) a year, according to market researcher Mintel.

“It may sound counterintuitive, but what’s happening in the crisis is a quest by consumers for value, for more affordable product, but also for products that overtake their expectations,” Freixe said. “And what is squeezed in the middle are mainstream products.”

More than 20 years after Nestle, based in Vevey, Switzerland, started selling the Nespresso capsules that helped create the luxury home coffee market, it is applying a similar approach to chocolate. The venture may help Nestle in the premium segment, where rival Swiss brand Lindt & Spruengli has prevailed, with sales rising twice as fast as the market in 2011.

While Maison Cailler is starting small, the approach has served Nestle well in the past.

Nespresso began in only two countries in 1986, and the strategy evolved over time, with Nestle introducing online sales in the 1990s and stores in 2002. Now it’s a 3 billion Swiss franc ($3.3 billion U.S.) brand, with about half its sales coming from the Internet, and more than 250 boutiques worldwide.

The coffee unit probably helped drive a 7.1 per cent increase in so-called organic sales for 2011, according to the average of 12 analysts surveyed by Bloomberg. The measure excludes acquisitions, disposals and currency shifts.

Nestle has been taking its cue from Nespresso’s success with other premium products. The company last year began selling BabyNes formula milk capsules, a year after introducing Special.T pods containing top-quality tea in France.

“Consumers like to be treated as individuals rather than as a mass market,” said James Amoroso, a food industry consultant based in Walchwil, Switzerland.

While Nestle’s KitKat bars are the ninth-biggest chocolate brand, according to Euromonitor International, the Swiss company has had mixed success in the premium segment.

Nestle, which merged with Cailler in 1929, sought to revamp the brand in 2006 with packaging designed by architect Jean Nouvel and higher prices, though the overhaul was scrapped after it failed to boost revenue. Cailler still isn’t well-known outside of Switzerland, with only 8 per cent of sales coming from abroad.

“Nestle is a strong player in the mass market, but in the premium segment it doesn’t have a strong reputation,” said Patrick Hasenboehler, an analyst at Bank Sarasin in Zurich.

Maison Cailler may also have to contend with the impulse-buying aspect of chocolate sales. Many consumers tend to buy chocolate on the spur of the moment for themselves or at the last minute as a gift, according to Marcia Mogelonsky, an analyst at Mintel in New York.

via Nestle bites into luxury chocolate market – thestar.com.

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