70% of Consumers Would Stop Following a Business After Data Breach
Sixty-nine percent of consumers feel businesses don’t take customer data security very seriously and 70% of them said they would stop doing business with a company following a data breach.
Amsterdam-based digital-security firm Gemalto also revealed in report ““Data Breaches and Customer Loyalty 2017,” customers expect businesses to protect personal data. The study based its findings on a survey of more than 10,000 consumers worldwide.
Surveyed consumers in 2017 are more likely (37%) to believe that they could be a victim of a breach at any time, compared to those surveyed in 2016 (35%) and 2015 (27%). In addition, 58% believe the threat to their personal information increases during a high profile commercial events like Black Friday, Amazon Prime Day or Cyber Monday, which experience a staggering $6.59 billion in estimated sales, the largest ever online sum for a U.S. shopping day.
The majority of consumers (62%) believe businesses holding their data are mostly responsible for its security. Consequently, businesses must take additional steps to protect consumers and enforce robust security measures, as well as educate customers on the benefits of adopting these measures.
When it comes to the businesses that consumers trust least, over half (58%) believe that social media sites are one of the biggest threats to their data, with one in five fearful of travel sites. On the other hand, a third of respondents trust financial institutions the most with their personal data, despite being frequent targets and victims of data breaches, with industry certified bodies (12%), device manufacturers (11%) and the government (10%) next on the list.
- Around three in five surveyed consumers said if an online breach affected a retailer (61%), bank (59%) or social media site (58%), they would stop using that company.
- Consumer respondents believe that the majority (67.79%) of responsibility falls onto companies for protecting and securing customer data, on average. Only 27% of respondents believe companies take this very seriously.
- Two in three (67%) fear the theft of online personal information at some point.
- The vast majority (93%) of respondents would consider taking legal action if they were the victims of a breach.
Despite customer concerns, the Gemalto study found consumers are failing to adequately secure themselves, with over half (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.
“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,” Jason Hart, CTO, Identity and Data Protection at Gemalto, said. “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.”
Hart continued, “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.” He added, the result is an alarming amount of breaches, 80%, 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.”