Data breaches hurt loyalty

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A majority (70%) of consumers would stop doing business with a company if it experienced a data breach, according to a survey of more than 10,000 consumers worldwide conducted by Vanson Bourne. In addition, seven in ten consumers (69%) feel businesses don’t take the security of customer data very seriously.

data breaches hurt loyalty

Consumers’ security concerns remain high

Despite these concerns, consumers are failing to adequately secure themselves, with 56% still using the same password for multiple online accounts. Even when businesses offer robust security solutions, such as two-factor authentication, 41% of consumers admit to not using the technology to secure social media accounts, leaving them vulnerable to data breaches.

This may be because 62% of consumers believe the business holding their data is mostly responsible for its security. This is resulting in businesses being forced to take additional steps to protect consumers and enforce robust security measures, as well as educate them on the benefits of adopting these.

Retailers (61%), banks (59%) and social media sites (58%) were found to have a lot of work to do, with these being sectors that consumers would leave if they suffered a breach.

“Consumers are evidently happy to relinquish the responsibility of protecting their data to a business, but are expecting it to be kept secure without any effort on their part,” says Jason Hart, CTO, Identity and Data Protection at Gemalto. “In the face of upcoming data regulations such as GDPR, it’s now up to businesses to ensure they are forcing security protocols on their customers to keep data secure. It’s no longer enough to offer these solutions as an option. These protocols must be mandatory from the start – otherwise businesses will face not only financial consequences, but also potentially legal action from consumers.”

Despite their behaviour, consumers’ security concerns are high, as 67% worry they will be victims of a data breach in the near future. Consequently, consumers now hold businesses accountable – if their data is stolen, 93% of consumers would take or consider taking legal action against the compromised business.

data breaches hurt loyalty

Consumers trust some industries more than others

When it comes to the businesses that consumers trust least, 58% believe that social media sites are one of the biggest threats to their data, with one in five fearful of travel sites – worryingly, one in ten think no sites pose a risk to them.

On the other hand, a third of consumers trust banks the most with their personal data, despite them being frequent targets and victims of data breaches, with industry certified bodies (12%), device manufacturers (11%) and the government (10%) next on the list.

Hart continues, “It’s astonishing that consumers are now putting their own data at risk, by failing to use these measures, despite growing concerns around their security. It’s resulting in an alarming amount of breaches –80% – being caused by weak or previously stolen credentials. Something has to change soon on both the business and consumer sides or this is only going to get worse.”