The Impacts of a Data Breach on Your Business
Nowadays, if you google your name, you’re able to pull up a plethora of information ranging from the high-level stuff such as your social media profile names to the nitty-gritty like your physical address. With the amount of information available on the web and various digital platforms, your customers are expecting the highest level of data protection. So what happens should your business fall victim to a cyber attack? We’re reviewing the two most significant impacts of a data breach on your business.
The Monetary Impact
Unsurprisingly, the U.S. holds the title for the highest average cost of a data breach according to Statista. While the potential cost of a breach depends on factors such as the type of cyber attack it was (malware vs. ransomware), the true cost runs deeper than just the amount paid to recover the data…
- Data breaches can pause business operations for weeks or months.
- Over 60% of small businesses fold within 6 months of a breach.
- Almost 80% of consumers will stop using a business is their information is compromised.
The Reputational Impact
Image from Varonis
While the monetary impact of a data breach can usually be recovered if business interruption coverage is in their insurance policies, the reputational impact is what causes businesses to go under in the long run. According to Varonis, 65% of data breach victims lost trust in an organization after a data breach. Losing over half of your customers is only one reputational hurdle in the post-data breach obstacle course. Thanks to the internet, the magnitude of a data breach is far-reaching and the negative reputation can spread to not only current customers, but to potential customers as well, sending them straight to your competitors.
- 52% of consumers would consider paying for the same products or services from a provider with better security.
- 52% of consumers said security is an important or main consideration when purchasing products or services.
When it comes to data breaches, it’s better to use a predict-and-prevent approach than a repair-and-reimburse method. Fortunately, data breaches can be minimized or reduced by knowing your cyber liability risks, implementing prevention techniques, and covering your business with the right policies.
Not sure what coverage or policies your business needs? Our team at Snellings Walters is here to help lead complex businesses into safety and security in every facet of your business. Just reach out to us here or give us a call at 770-637-1727.