Cyber security

The reputational and business damage of a data breach

Antivirus software provider McAffee stated in 2015 that hacking was becoming a global problem whilst, alongside Google, estimating that there is approximately 2,000 daily cyber-attacks worldwide.

Not only can a data breach damage your company internally but the external effect it can have on reputation can be disastrous.

Cyber security breaches

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A cyber-security breach consists of sensitive, protected or confidential data being stolen, viewed or used by an unauthorised individual.

In most cases, this data is then used illegally by attackers to gain access to customer accounts, from eBay accounts to online bank and phone accounts. This often leads to further data breaches surrounding payment and account details.

With more data online than ever before, the number of breaches is quickly growing, along with the cost. Californian based company ThreatMetrix stated that from August to October 2015 there were 45 million attempted hacks towards online retailers.

Whilst a study conducted by IBM and Ponemon Institute, found that the average cost of each individual’s data that included personal and personal identifiable information (PII) was $154.


Last year saw telephone giant TalkTalk fall victim of a serious data breach in which confidential customer data was obtained. This lead to TalkTalk customers fearing that all personal data in relation to their telephone accounts had been hacked, ranging from passwords to bank details, putting them at significant risk.

In response to the scandal, TalkTalk faced an immediate uproar online, particularly on Twitter. Unhappy and concerned customers were turning to the social media platform to voice their complaints and demand answers. The topic gained 200,000 tweets in seven days and began trending.

Initially, very little information was officially released to the public and customers which further prompted negative online conversation surrounding the company.

However, the company was seen to be making the effort to reply to as many customers individually as possible online and two days after the scandal broke an official apology video featuring CEO Dido Harding was released.

This data breach hit TalkTalk’s reputation hard and they are continually working in order to regain consumer trust and build up the reputation they once had.

Damage to companies

Customer acquisition and retention, share price and ultimately reputation are all factors that come under attack after a cyber-security breach. TalkTalk lost over 100,000 customers, and saw a drop in their share price.

As well as this, the costs of IT support, customer support and overall loss of sales, mounted up to an astonishing £60 million.

However what some may deem as the most valuable of all is reputational damage. Consumer trust and good reputation come hand-in-hand and without one you often don’t have the other.

With a company’s reputation often reflecting their worth, it’s crucial that any damage, if completely unavoidable is limited.

What companies should do

Although some data breaches cannot be avoided there are a number of factors you can take into consideration and implement in order to work towards the prevention of one.

  • Regular server scans and security checks

Ensure that you regularly scan your site for malware as well as other vulnerabilities, making sure it is safeguarded from hackers. Also, conducting regular PCI scans will give you the ability to discover any problems your e-commerce site may hold and intercept issues before hackers can exploit.

  • Deleting records

The more data that is acquired and obtained within your database, the more likely you are to be targeted by hackers. Where a customer’s payment data is required you should aim to remove them from your records, this should apply to any data that you do not need on file at all times.

  • Utilise secure systems

The use of secure password systems such as LastPass will give your company passwords heightened security and prevent hackers from gaining access to employees log on details. If accessed by hackers private business information can easily be viewed and used.

  • Train your staff

If your staff are fully aware of company policies and guidelines as well as being trained on safeguarding customer data you will automatically minimise the risks that could ultimately lead to a data breach.

Be prepared

Cyber-criminals may target a business no matter how big or small. Implementing a thorough strategy across the company can ensure that you are prepared for the effect that a data breach may have should one strike.

The impact a data breach can have is significant and in some cases, irreparable so limiting the opportunities hackers may see is crucial.

For more information on reputation management and protecting against data breaches please contact me on tel: +44 (0)203 542 8689 or email in confidence.

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