Close

Choose a country

United KingdomEnglish
South AfricaEnglish
IndiaEnglish
InternationalEnglish

Why data breaches are disastrous for retail brands

Blog
29th August 2017

Over the past two years, retail has suffered more data breaches than any other industry. Security breaches are particularly troubling for retail brands because they often hold a large amount of personal data on customers. This can include their complete shopping history, payment details and delivery details.

Retailers around the world have paid a high price for losing customer data in various breaches. When Target allowed data on 40 million customers to leak they were fined $18.5m. A 2014 data breach by Home Depot initially cost the retailer $27.25m in compensation payments to customers, but once legal fees and other costs were added up it possibly cost the brand around $179m.

Research by KPMG in 2016 showed that around one in five customers would completely stop shopping with a retailer if the company was hacked and data stolen. This view still applied even if the retailer had taken immediate action to improve data security and limit any data loss.

It must be tempting for retailers to keep quiet when faced with a data breach, but this approach can be even worse as the betrayal of trust can be extremely damaging. News of the data loss will almost certainly leak, so an open approach is better (providing the breach could not have been prevented, of course).

For companies in Europe, there is an even greater requirement to be vigilant and compliant with data regulations as the EU GDPR (General Data Protection Regulation) rules will be enforced from May 2018. Already law across the EU, but not enforced until next year, the GDPR creates a new approach to data use with a focus on the rights of the customer.

This new compliance regime in Europe and the constant threat of data loss from hacking and social engineering attacks should make all retailers sit up and take notice. Retail data is under attack, from the contact centre to the in-store environment. If you don’t protect the information you have on your customers, then a fine is only the start of your problems – your customers may never return.

What do you think about the new data rules? What else can companies do to recover trust after a breach? Leave a comment here or get in touch via my LinkedIn and let me know.


Leave a Reply

Your email address will not be published.Required fields are marked *


Helen Murray
Article by: Helen Murray

News & Insights

Recommended for you
Service Provider
Solution Designer
Technology Enabler
News
Mayor Hubert Bruls of Nijmegen opens newest Webhelp location in the Netherlands

On Friday 19 April 2019, Mayor Hubert Bruls of Nijmegen opened the newest location of Webhelp Netherlands. The  new site is located in the unique FiftyTwoDegrees building in the heart of the city's knowledge innovation center. Customer service to a higher level Since 1985 Webhelp has been active in the Netherlands in organizing and handling customer contact. A lot goes by telephone, but...

Blog
3 key questions about your marketplace business model

One of the main marketplace elements you should consider is, of course, the business model and profitability. How can I develop my marketplace project into a profitable long-term business? Here are three key questions you should ask yourself to find out. What ratios should I envisage in my...

News
Webhelp’s market expansion strategies in the contact centre outsourcing market earn it accolades from Frost & Sullivan

Webhelp's keen focus on agile customer experience (CX) solutions has helped it grow across Europe in an intensely competitive market Based on Webhelp’s successful growth strategy across Europe, Frost & Sullivan has recognised the company with the 2018 European Market Leadership Award in...

Whitepaper
B2B Marketplaces are blossoming

Following our publication last year of " The Spring of B2B Marketplaces ": it is time to look back and to answer these questions: has there been some movement in the market? Have B2B players evolved in their marketplace business models? Is launching a new market observatory worthwhile? The answers...

Case Studies
Post Office Limited®

...

Load more
×

Webhelp Cookies Preference Centre

Strictly Necessary Cookies
The website requires the use of cookies for essential functional requirements and these are outlined in the terms and conditions.

Enhanced Functional Cookies
Some features of this website use services provided by third parties websites. These features use cookies to implement their services on this website and may collect data about your visit to help them optimize their functionality. The Webhelp terms and conditions outlines the cookies used by these services.

We have links to social networking such as Twitter, Facebook and LinkedIn.
These websites are third party sites. We do not place cookies on their behalf, and do not have control over the way they collect or use your data.
We encourage you to read more about their policies:
Twitter
LinkedIn
Facebook