Did Target gather information about customer behavior or customer need?

Please read the assigned article "How Companies Learn Your Secrets" (Abbreviated from the NY Times about Target, Inc.) 

The article describes the process that Target used to identify information about individual customers, how they used the information, and the consequences that resulted. Did Target gather information about customer behavior or customer need?  Please explain your answer using information from IDIC Process Model: Interaction with Customers and Customized Treatment.

Download (optional): "How Companies Learn Your Secrets"

Privacy issues are becoming more of a concern as more and more information is gathered by organizations we do business with. Do you believe Target overstepped the acceptable privacy boundary? What do you suggest Target might have done differently to avoid the controversy? Please defend your response.