- Data breaches, impacting all business sizes, expose confidential information and cause significant financial and reputational damage.
- They can lead to revenue loss, legal and regulatory fines, and increased security expenses, among other costs.
- Negative publicity from data breaches can significantly damage a company’s reputation and customer acquisition efforts.
- Preventive measures include using cloud services, implementing strong password policies, and providing comprehensive employee training.
- Investing in prevention and securing data can significantly decrease the risk and potential impact of data breaches.
Data breaches can be a hefty expense for any business, regardless of size. It not only costs businesses money but also the trust of their customers. 43% of companies report a customer data breach, and about 46% could not regain their customers’ trust after the disastrous incident. Here’s a look into data breaches, how they can cost your business, and what you can do about it.
Data Breaches Today
A data breach is a security incident in which confidential information is accessed or stolen, usually without the owner’s knowledge. Data breaches have been a significant issue for businesses throughout the years. In 2019 alone, over 4 billion records were exposed due to data breaches worldwide.
Does It Affect My Business?
Data breaches do not discriminate between small and large companies; they can affect any business. Here are some ways it can affect your business:
1) Loss of Revenue
Data breaches might cost your business unexpected loss of revenue. According to a study conducted by IBM Security, it costs breach victims around $4 million per breach on average. The lost revenue is not solely due to decreased sales, but sometimes customers decide to leave the business due to security concerns, which may reduce your market share. So, to regain the trust of your customers, you may also have to spend significantly on marketing campaigns and building an updated technical infrastructure.
2) Legal and Regulatory Fines
Some data breaches are mandatory to report to the regulatory authorities, and each jurisdiction has different regulations that must be followed. Moreover, a court case may emerge in case of any damages caused to take place. The last thing any business owner wants is to face legal repercussions due to their carelessness. The cost of hiring lawyers and the amount of penalties charged may turn out to be costly.
3) Reputation Damage
The size and scale of the damage sometimes might not be visible in data breaches. Social media and the press are bastions of free speech, and any bad reviews put there will affect your business long-term. Negative publicity can influence the perception of the brand’s credibility and, as a result, hinder customer acquisition techniques.
4) Forensic Investigations
Every breach situation has been investigated by industry experts that can determine the cause of the breach and the possible impact, but it also adds up to a significant expense. If a regulatory body orders an audit, gathering all the information and data might take a long time, and the cost is substantial.
5) Increased Security Expenses
It is essential to increase data security to ensure it is at the best level possible. Processes that include an effort to perform an audit and no compliance training for employees can lead to haphazard handling of crucial data. Investing in employee education and training, specialist security software, and hardware to keep your data safe can create cost involvement.
Ways to Prevent Data Breaches
There are various ways you can prevent data breaches. Here are three ways:
Cloud Services
Cloud services are crucial for defending against data breaches. ExaVault is a reliable cloud storage platform that provides efficient, secure, and user-friendly services. ExaVault helps to protect data stored in the cloud from malicious attacks with its comprehensive security measures like two-factor authentication, encrypted file transfers, etc., which can help minimize the risk of a data breach. However, it’s very costly for many small businesses. Instead, consider looking for the best ExaVault alternatives. These alternatives can be much cheaper and offer many more features than the typical cloud storage, which can help you protect data from cyber threats.
Password Policies
Implementing stringent password policies is one of the most efficient ways to prevent data breaches. Companies should encourage their employees to use complex passwords, including alphabets, numbers, special characters, and symbols, to make them more secure. Changing passwords regularly is also recommended to ensure the security of data stored in the system.
Employee Training
Employee training is a must when it comes to preventing data breaches. Employees should be taught how to handle confidential information and updated with any new rules or regulations introduced by the company regarding data security. This will help them understand their role in ensuring the company’s data is safe and secure.
Data breaches can be costly for any business, both financially and reputationally . Taking the right measures to prevent these malicious attacks can save your business from such losses. The best way to protect your business from data breaches is by investing in reliable cloud services and providing employee training. All of these measures will help ensure the safety and security of your data.
