Equifax was hacked and excess of 143 million people private data were compromised. Bad people could use the data for identity theft resulting to years of nightmare to the people affected. U.S. Congress and American residents are unhappy. That is rightly so because Equifax was careless. It dropped the ball on the most important raw material of its business: the people’s data.
In a prepared testimony ahead of his appearance before a congressional panel, former Equifax CEO Richard Smith said he was “deeply sorry” about a data breach last month that exposed the personal data of more than 143 million consumers, saying his company “failed to prevent sensitive information from falling into the hands of wrongdoers.”
But as you look into this mess, there is something that is clear: Equifax has a business that is extremely well positioned that even in this mess, it can still profit. I mean, Equifax can be making money even as it is causing mayhem in the lives of American residents. Here are some ways Equifax is profiting:
- Equifax offers enhanced credit monitoring to the same people its data breach is causing harm. So Equifax wants the customers to pay for services to help protect their identities from being used for fraud
- LifeLock, a specialist on identity theft protection, which is experiencing massive business boom due to the Equifax data breach, buys its credit monitoring solutions from Equifax. Simply, even if you do not want to work with Equifax directly and decide to buy solutions from LifeLock, you will still be sending money to Equifax
- U.S. Internal Revenue Service, the tax collection institution, signed a $7.25 million contract with Equifax just as the break was made public in September. The deal is for tax fraud detection and prevention.
Sure, Equifax will pay tons of money through class action. Trial lawyers are already circling. Yet, despite that, it is very evident that this company has deep positioning in the market. It can win on any side of the coin: head or tail.
Think about it, and see how you can build a company that can be structured with such deep positioning that even in crises, your customers will need your services, business partners will sell your services, and the government will come to you and buy your solutions even when you are the main catalyst of the mayhem. Its deep positioning is something every brilliant entrepreneur must aspire to replicate in its industry.
Usually when crises come, people run away from companies. But here, citizens are running to Equifax, partners are selling its solutions, and government needs Equifax help. Its positioning is very uncommon in markets.