Introduction: Cyber Risks and Data Breaches at Your Store
What a Data Breach Means for a Retailer
Unless you're a tech expert, you might be uncertain about what exactly a data breach is. No worries. Data breaches occur when an unauthorized person gains access to your data. We'll explain how this can occur in the section "What Are Data Breaches?" For now, you should know that criminals can break into your data through many channels, ranging from sophisticated cyber attacks to dumb tricks like guessing your password.
In addition, your employees can access sensitive data when it's not adequately protected. Employee-led breaches may be accidental or malicious; either way, they have the potential to hurt your business.
For retailers, data breaches are costly. After a breach, you'll have to pay for all kinds of services, upgrades, and other costs that come with cleaning up 21st-century theft and fraud. These costs include…
- Credit monitoring services for your customers (to prevent identity theft).
- IT professionals to investigate the incident and find where the breach occurred.
- Crisis management.
- The cost to notify customers whose data may have been stolen.
And there's more. A store might have thousands of customers. Imagine having to deal with all those complaints and questions. The amount of time you'll spend responding to a breach will be a huge drain on your business. In fact, according to a report by Experian , 60 percent of hacked small businesses close up shop within six months.
It should be no surprise to learn that data breaches can be devastating for a retailer's reputation. That's especially the case for small businesses. You're working to attract new customers to your business, but a breach could be enough to convince even your most loyal customers to shop elsewhere.
6 out of 10 small businesses that are hacked close within six months.
Next: Is There Any Good News About Data Breaches?