There are some questions that business owners don’t want to find out the exact answer to. Ignoring the threat of a data breach could spell disaster for your long-term business potential. This guide is here to help you learn more about the total costs of a data breach, to help you better understand and identify the need for advanced cybersecurity protection.
What Factors Make Up the Total Cost?
In order to ascertain what a successful data breach would cost your business, it is first necessary to outline the factors contributing to this cost. There are many contributing factors that all work together to increase the overall cost of a successful data breach. The list below outlines some of the factors that add to the cost of a successful data breach.
Detection and Response
If you are not already using a comprehensive security, monitoring, and managed services system, you will need to pay for a detection and response service. This cost will include the forensic and investigative teams that assess, identify and manage the crisis.
Loss of Productivity
A successful data breach messes with your everyday operations. It is almost impossible for employees to continue as normal after a successful data breach, quite simply because you will not have the standard processes up and running. After a successful data breach, you will likely need to take your website offline and investigate your processes; this all leads to disruption and a reduction in productivity.
Loss of Sales
As your systems are not running as usual and you don’t have your online store in operation, you will likely experience a loss of sales. Whether they are from potential first-time customers or returning customers, this can signify a significant loss in profit, especially if your systems are offline for some time.
Not all of the damages from a successful data breach will be clear immediately; some take time. The reputational damages that occur as a result of a successful data breach might take time to manifest, but their effects can last for years.
The reputational damages can add to the total cost of a successful data breach as they lead to customers avoiding making purchases from your business. The reputational damages do not only directly affect sales but your brand image too. Increasing the need for marketing damage control as consumers view your business as uncredible and untrustworthy.
Depending upon the foundational cause of your data breach and the location of your business, you might also be looking at facing legal repercussions for a successful data breach. Since human error accounts for 23% of successful data breaches, it is not unlikely that your business might be facing legal repercussions.
Cybercriminals are not only exclusively targeting larger businesses; in fact, small companies are also seen as easy targets and therefore actively pursued. Making sure your company has fully trained staff and a comprehensive set of security measures is essential for ensuring the long-term health of your company.