Businesses face losing customers with data breach failures

Firms that fail to adequately protect data from security breaches run the risk of losing customers, according to new research.

Consumers were found to view businesses as being the ones responsible for protection too, the study by Gemalto found.

The survey questioned customers from around the world, including from Australia, France, Germany, India, Japan, the UK and the USA among others.

It is suggested that 70% of the responsibility for protecting and securing data lies with businesses, yet despite this, just 29% of consumers believe firms are taking the adequate steps to do so.

Around 4.8 billion data records have been exposed since 2013, with theft the reason for 64% of all cases.

Despite the increased risks, the study also revealed that many consumers are not protecting their data themselves, which places further pressure on businesses.

Nearly six in ten consumers believe they will be a victim of a data breach and suggest that any businesses involved will business as a result, especially if sensitive data is lost or stolen.

This could severely impact businesses as they could quickly have a change of fortunes should they become the victim of a data breach.

In any instance where finances are hit, a firm is encouraged to take on an independent business review in an attempt to identify practical approaches to recovery.

Such an approach is especially useful if a business is experiencing a period of difficult trading, has cash flow issues, or is reconsidering its future strategy.

Around one fifth of consumers were found to have already been affected by the fraudulent use of their personal details or as a result of identity theft.

A lack of security measures on a business’ website was found to influence consumer practices too. The study found that individuals are prepared to take risks with their information, but will tend to blame the businesses concerned when something goes wrong.

In order to avoid potential losses and damage to reputation, businesses can opt to include more security and data encryption, although it does come at a cost.

By Phil Smith

If you would like to have a free no obligation chat with one of our advisers please call us on 020 7186 1144.


View all Business Insights