Cybersecurity Boosts Customer Loyalty and Sales
One out of five CEOs admit that risk for information security alarms them the most, according to an in-depth report by KPMG.
With data security breaches becoming more alarming than ever, even consumers are starting to be more conscious of their privacy. What you probably didn’t know is that cybersecurity is about more than just privacy, as it affects customer loyalty and even sales.
Insufficient security leads to losses in trust and sales
A recent example would be Facebook having lost 3% of their share value due to 50 million compromised accounts.
Their shares falling is no surprise. Why, you ask? It is because modern consumers are active ones. They know how an attack like this can make them more vulnerable to crimes that directly affect them, such as identity theft and fraud.
Another example of negligent data protection comes from Sony.
Estimates reveal that Sony, after suffering a data security breach in 2011, suffered $1.25B in expenses from lost business, compensation and legal fees. The Japanese company also stopped its operations for a month just to work around the clock to get themselves out of the predicament.
Great losses further prove that building consumer trust is not to be considered a joke. It plays a heavy hand on the current and potential demand for a company’s goods or service.
Security builds trust which leads to loyalty and sales
Today, more and more businesses are taking proactive measures. It is about time businesses learn that they are more liable for their customers’ privacy than they thought.
Still not sold on the importance of cybersecurity? Try asking your customers.
Only 25% of consumers believe that data gathered from them is being handled responsibly, while 69% believe that companies are vulnerable to breaches. Whether it be sensitive information like contact details, history or health records, these are being put to the hands of the company by customers with reluctance. Consumers simply don’t have a choice.
The findings are highly alarming but good for those in the know.
Customers who keep the business alive want reassurance. Furthermore, it illustrates how unrest is bred by insecurity. Profits surely await those who are actively investing in cybersecurity.
Enhancing cybersecurity will ultimately strengthen trust between the parties. Here’s a huge figure you can’t ignore: 88% of the consumers are only willing to give out personal information if they trust a certain company, and 87% will go elsewhere if they are given reason not to trust a business.
If this culture of distrust and uncertainty continues, data will be harder to get a hold of. This will make it harder for customer-facing businesses to make informed decisions to provide a better service.
Future of digital safety
A study conducted by PSFK, a New York-based trend research company, in collaboration with Mastercard, showed there are trends in dynamic protection procedures that are constantly being developed to battle cyberattacks. These procedures are:
Ephemeral information applications
These are applications that allow users to send sensitive information for a specific amount of time, after which the sent information self-destructs and can no longer be accessed.
Evolving encryption
Companies work to create authenticating systems that not only evolve in difficulty, but maximize difficulty for hackers while minimizing their demand for their customers’ effort.
Crowdsourced security
Select members of the consumers are given the chance to engage, analyze and give feedback to security measures of a company’s particular product. This may come in the form of bug bounties that enable users to disclose issues to the company in exchange for reward.
Cybersecurity policies you can apply today
It also helps to take time to make sure your customers understand the weight of data privacy by educating them on how it affects them directly, in newsletters, knowledge bases, or through other means of notification. This builds an image of a benevolent, trustworthy company.
In addition to this, you can also set up a Virtual Private Network (VPN) that adds an extra layer of protection from potential cyber attacks by encrypting your activity. The best VPNs provide great levels of security, and companies shouldn’t stop here; they must continue to seek more secure and innovative in order to gain their consumer trust in the constant battle against hackers.
When all else fails, as much as it pains us to say something cheesy, honesty is the best policy. Forrester said in this year’s Brand Experience Playbook that emotional brand experiences are achieved through customer-centric efforts.
If a company is to disclose and apply transparency in dealing with consumer data, there will surely be more trust. This is a key that may unlock endeavors related to connected devices for longer in the future.
Customer-centered companies that rely on a face-to-face businesses should inform users how they collect, share, protect their data because of the nature of their job that thrives on trust.
Leveraging security to increase loyalty
Taking good care of your customer has never been a bad thing. Nothing will tarnish your reputation than an embarrassing display of indecision in the face of a breach. Putting an up-to-date cyber-risk reduction in the forefront helps your customers sleep well at night knowing that they are away from harm.
Policies implemented by a company to protect their customers greatly affect how they are seen in the market. Effective branding breeds customer trust, hence greater opportunities. With heightened cybersecurity, not only are you protecting your customers, but you are also putting your company under good light. This effectively makes you a more desirable option in the market.
Lack thereof, however, will only bury your company among your competitors. And only those who are secure will stand out, gain and keep the market share.
You are probably thinking, “it’s easier said than done” — and you are not alone in thinking this.
The 2015 Global CEO Outlook survey by KPMG revealed customer loyalty, keeping pace with technologies and relevance of their product or service, are the three factors that constantly worry CEOs.
These three points are, at their core, related to a famous message in business — innovate or die.
Businesses must be in the constant state of bettering themselves in order to thrive. Growth cannot be achieved without consumers; that’s just a simple rule in the mechanism of markets.
If you want your company to grow towards the right direction through good practice, you might want to listen to KPMG’s global head of security.
“The most innovative companies have recognized that cyber security is a customer experience and revenue opportunity, not just a risk that needs to be managed.” Malcolm Marshall, KPMG
As an ethical hacker, Jamie Cambell (Ph.D., M.S. in Computer Science at University of California) prefers to remain anonymous. Jamie is a technology enthusiast and a part-time gamer, whose ultimate goal is to liberate the Internet with the help of VPNs.
