Data breaches cost brands business and reputation
Consumers would stop doing business with a company known to have experienced data breaches.
According to an IBM report, nearly half of consumers surveyed said they had taken this action. This is alarming news when coupled with the global average cost of a data breach reaching an all-time high of $4.35 million for studied organisations.
Now in its 17th year, the Cost of a Data Breach Report – conducted independently by Ponemon Institute, and sponsored, analysed and published by IBM Security – studied 550 organisations impacted by data breaches occurring between March 2021 and March 2022.
The breaches occurred across 17 countries and regions and in 17 different industries. More than 3,600 interviews were carried out for the report with individuals from organisations that were impacted by the data breaches.
Breach costs also increased nearly 13% during the last two years of the report and the findings suggest these incidents may also be contributing to the current rising costs of goods and services.
Sixty per cent of the organisations studied in the report had raised their prices for goods or services due to breaches.
High profile data breaches damage customer trust
High profile UK data breaches in the last couple of years, including the Cambridge Analytica scandal, and those which impacted Virgin Media and Mumsnet, have led to growing worries across all industries.
This lack of confidence translates into a loss of business for companies, as customers are increasingly reluctant to engage with businesses they don’t trust. This is a worrying trend, as businesses must do more to show consumers that they take data protection seriously.
Research from ISACA also found that less than one out of four (23%) UK consumers are confident that businesses can safely secure their personally identifiable information.
Nearly half (48%) of consumers said they have stopped doing business with a company known to have experienced a breach.
“Trust is a key differentiator for businesses when it comes to acquiring and retaining customers, and we need novel approaches that combine cybersecurity with the adjacent domains of audit, risk, privacy, and technology governance under a digital trust umbrella,” said Chris Dimitriadis, ISACA’s Global Chief Strategy Officer.
With businesses increasingly collecting and storing large amounts of their customers’ data, there are concerns that this information may not be adequately shielded.
The IBM report also found 83% of studied organisations had experienced more than one data breach in their lifetime and, also of concern, nearly 50% of breach costs are incurred more than a year after the incident took place.
“The perpetuity of cyberattacks is also shedding light on the ‘haunting effect’ data breaches are having on businesses,” IBM Security said.
Cyber security in the UK
The UK Government’s Cyber Security Breaches Survey for 2022 found that of the 39% of UK businesses who identified a cyber attack, the most common threat vector was phishing attempts (83%).
One in five (21%) identified a more sophisticated attack type such as a denial of service, malware, or ransomware attack. Despite its low prevalence, organisations cited ransomware as a major threat, with 56% of businesses having a policy not to pay ransoms.
Organisations who reported a material outcome, such as a loss of money or data, ended up with an average estimated cost of £4,200. But when looking at only medium and large enterprise, that figure rises to £19,400.
The Department for Digital, Culture, Media & Sport, which oversees cyber security, also believes the lack of framework for financial impacts from cyber attacks, may lead to underreporting.
Preventing data breaches
There are several steps businesses can take to improve their data protection and regain consumer confidence. These include investing in security technologies, increasing employee data security awareness, and implementing industry-leading best practices.
Protecting your website and advertising from bots can also help brands with potential cyber and data breaches.
Adopting tools like the Veracity Trust Networks’ Ad Fraud Protection and Website Threat Protection can ensure a number of benefits, including:
- Detection and prevention of bot attacks using advanced technologies such as machine learning and artificial intelligence to detect and prevent bot attacks in real-time.
- Reduction of click fraud by detecting and blocking fake clicks generated by bots and other malicious actors, ensuring accurate traffic data and reducing wasted spend on fake clicks.
- Enhanced security by providing additional layers of security to protect against cyber attacks and other forms of malicious activity.
- Improved website performance by preventing bot attacks and click fraud, helping to improve the overall performance of websites with a better user experience.
- Peace of mind for website owners, who can be confident that their websites are protected against the latest threats and are functioning optimally.
The Veracity Trust Network safeguards organisations from the threat of bot attacks, through its deep tech machine-learning solutions which address Security, Fraud and Ad Tech.
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