According to recent studies, since 2013 there have been over twice as many records that have been stolen or lost than there are humans on the earth. Statistics like this should be shocking, but many find it difficult to quantify what this means in real business terms.
With this in mind, it’s important to take a step back and look at the tangible effects that breaches in cybersecurity could potentially have on your business, and they boil down into two categories; reputation and bottom line.
The Impact of a Data Breach on Reputation
We live in a world where negative stories are shared rapidly across digital channels, often gathering millions of views, likes, comments and shares. We also live in a world, in part thanks to new (well publicized) compliance requirements, where consumers understand the value of data and their right to data privacy and security.
Together, this has created an atmosphere where data breaches affecting consumer data tend to be heavily reported on by the press. Many studies have shown that a company suffering from a data breach will lose a significant amount of trust with their customers. Loyal customers can turn away, investors lose interest and stock prices fall.
You’ll find no sanctuary on social media or in the press either, as the likely backlash will be significant. You’ll have a lot of explaining to do. The only way you can really recover from this dent in reputation is to prove to people that you have taken proactive steps towards better cybersecurity for the future. Even so, your company will always have the spectre of the data breach looming over you.
The Impact of a Data Breach on the Bottom Line
There are a number of reasons why data breaches affect companies financially. Firstly, if the documents lost in a data breach have any information that is important to the business, it’s likely that growth will slow. Say, for example, one of the documents lost was a valuable research report that you were using to plan next quarter’s go-to-market strategy. You will likely have to start from scratch if this report is lost.
Secondly, data breaches can affect the day-to-day operations of a business, and it goes without saying that downtime can be financially crippling. You will also have to take into account what the damage to reputation we previously talked about will have on the bottom line. Research shows that companies suffering from a data breach generally underperform against the market average for a significant period of time during the fallout.
Research form the 2018 Data Breach Study highlights a few key statistics on the effect data breaches can have financially:
- A data breach resulting in the loss of one million records could cause up to €36m in losses.
- A data breach involving 50 million records could cause up to €314m in losses.
- The average cost of a record lost in 2018 increased to €133
- Companies in the healthcare industries are the most at risk of suffering costly data breaches, incurring losses of €366 per record.
How Lepide Can Help
What are you currently doing to proactively improve cybersecurity and protect valuable data? Do you know where your most sensitive data is, who has access to it, what your users are doing with it and whether your environment is secure?
If that sounds like a lot to ask, you might need some help. LepideAuditor is an automated data security platform that can help you answer all of these questions. It will continuously monitor and report on changes being made to your critical data, systems and permissions. Best of all, it will automatically detect anomalous user behavior and alert you so that you can react quicker to potential breaches.
If you’d like to see how LepideAuditor can help your business detect and prevent data breaches, schedule a demo with one of engineers today.