Data breaches highlight the importance of consumer worry over their personal data being sprawled all over the World Wide Web.
It sounds daunting, but it can have an irreversible impact on individuals. Recent reports show that they could leave their suppliers in the event of a data breach, and with breaches being on the rise, this could really have an effect on the way the markets are for business and competition
The survey shows…
This was the case with half of the 2,000 KPMG surveyed individuals. According to the survey, half of consumers would leave their current broadband and mobile supplier if they breached data protection.
Even more drastic measures would be taken, such as paying for an early termination of the contract. This goes to show that consumers value security and would not take the risk again if their current supplier breached data protection.
Breaches could also force consumers to switch providers.
It does not seem to be the general consensus for all. TalkTalk, who breached 157,000 of their users’ personal details – costing them £400,000 – reportedly lost 9,000 customers in the wake of the breach. In the same event, they gained an additional 48,000 mobile customers.
Importance of data protection
However, the importance of building trust with customers is very important. Companies need to properly invest in their cybersecurity to win over the trust of their customers and the public.
By building the foundations of security, this could help to make companies successful and leaders in their industry. It can be seen as them connecting with their customers and taking a kind consideration to their customers’ data – something that many companies fail to do.
Spike in data breaches
Data breaches do not show any signs of slowing down.
In recent years, there has been an upward spike which has cost businesses millions as they rectify the issues and pay compensation to victims. If you look at data breach statistics, this may confirm the worry. Yahoo’s recent data breach is a living proof of this with over a billion users’ data stolen.
It’s not a matter of if businesses are going to be the next victim to a data breach; it can be when. Now more than ever is the time for companies to invest heavily (financially or otherwise) in their cybersecurity. It could be likened to preparing for a war; but a cyber one. You would not prepare for it without having the necessary training, and you would not go into it without protecting yourselves with the right tools.
That would be foolish.
In both the customers’ and the company’s best interest
It’s not only in the customers’ best interest, but also in the company’s interest to invest in data protection schemes.
Of course the losses and hurt that breaches cause individuals is obvious. Their personal information is in the hands of the unknown and they may be vulnerable to future hacks or misuse. Companies may feel the impact with fines and undertakings given by the Information Commissioner’s Office. This could cost companies more than the fine itself.
Data breaches can also have the ability to cripple a company – both financially, and by harming their reputation. In a report undertaken by Gemalto, a digital security company based in the Netherlands, there was a correlation between data breaches and customer loyalty.
Word of warning
If companies do not want to lose their customers, they better act fast in building a steel wall against potential data breaches. Data breaches have an obvious deep impact on their customers, which may be long-lasting. Companies need to remain vigilant and make continuous reviews in their cybersecurity to ensure that data breach risks are kept to a minimum.