The impact of cybercrime on company reputation: A 2022 update

by | Oct 20, 2022 | Public Relations

Many factors go into a company’s reputation, but like trust, what takes ages to build up can be brought down instantly. One of those instances is a cyberattack. While being a victim of a crime isn’t inherently going to cause a drop in customer loyalty, your approach to being attacked does factor in. How customers perceive you after a significant data breach depends entirely on the type of attack, whether you kept your customers in the loop, and how you worked to improve after.

How cybercrime impacts a company’s reputation

Cyberattacks impact digital-based companies the most. In a poll of 1000 Americans, only 7 percent claimed they would continue to use a rideshare company after a data breach, while 42 percent were happy to continue shopping at a retail store. A drop in trust will also affect small and lesser-known businesses more, as they are less likely to have established generational trust amongst their customers.

Target, for example, experienced a massive scandal after they were the victims of a significant data breach. The year after, they noticed a 54.6 percent drop in consumer perception, but that number has since bounced back up. On the other hand, Uber experienced a 141.3 percent drop in consumer perception following its ransomware attack. Uber, of course, also forewent informing the public of the attack. Their delay reduced customer trust and resulted in fines and sanctioned security protocols.

Though Target and Uber are massive companies, a few key factors played out in these two cases. Target, for one, is over a hundred years old, and while they have an online store, it’s primarily a brick-and-mortar-based business. On the other hand, Uber has only been around for about a decade and involves new technology that customers are inherently less trustful with.

Cybercrime and PR in numbers

There are far-reaching consequences for companies following a cyber attack. On average, 65 percent of customers whose information was stolen in a data breach lost trust in the company, while 80 percent will consider changing businesses. Customers aren’t silent, either. According to an Interactions Marketing survey, over 85 percent of customers have in-person or online experience. When those complaints make their way online, it negatively advertises your company, making it more challenging to bring on new customers.

How to prevent cyberattacks: Your 2022/23 update

  • Upgrade your security

You will need an effective firewall and anti-virus software system that scans incoming connections and prevents users from downloading suspicious files at the source. Depending on the size of your company, you may also want to invest in hiring an IT specialist in-house or outsourcing your IT and security needs. At a minimum, having a specialist optimize your system’s security is recommended.

  • Use data encryption

Using an SFTP server allows your business to transfer data securely through encryption, making it a better way to send information. It also ensures that only the intended recipient has access. Don’t stop at file transfers. You need to encrypt your entire system. This way, even if hackers force their way into your servers, they cannot use the information they find.

  • Add in endpoint security

Every device that can hook up to your company’s system is a threat. If that device is infected with a malicious program, it could download to your system before you know it. You need to invest in endpoint security to prevent an employee’s phone or personal computer from being the source of a breach. IoT, or the Internet of Things, is becoming an increasing problem for IT security professionals. Endpoint security works to minimize the risks brought on by IoT devices.

  • Monitor user access

Every employee should have a personal account and unique login details that are not used elsewhere. They should also be limited in the information that they need. This way, if one user’s login details are stolen, the knowledge that the hacker has access to will be minimal. You’ll also want to train employees to reduce the risk of a break, as user error is the leading cause of a breach. Train your employees on the best practices, how to secure their home system, and how to spot risks online.

How to recover

All the above steps will reduce the risk of experiencing an attack, but nothing will eliminate the threat. You’ll need a disaster plan that complies with government regulations. Have your PR team draft a public relations recovery plan alongside your disaster recovery plan to come back stronger than ever after a breach.

James Daniels
James Daniels is a freelance writer, business enthusiast, a bit of a tech buff, and an overall geek. He is also an avid reader, who can while away hours reading and knowing about the latest gadgets and tech, whilst offering views and opinions on these topics.