Every day, consumers share their data with companies during financial transactions or social media engagements, while watching their favorite streaming networks or using their GPS-enabled devices, and more. Data is currency, and many consumers are unaware of just how much the companies they interact with know about them.
In an ideal situation, this data can help companies provide a more personalized, more relevant customer experience. But when this data isn’t properly protected and falls into the wrong hands, consumers’ identities can be stolen, their credit score can be ruined, they can be locked out of essential tools or services—or worse.
Suffice it to say, a data breach can create a legitimate crisis that can permanently alter a company’s reputation with the general public. That’s why data privacy, and issues related to data security, is the number-two priority for companies in Reputation Institute’s 2020 Global Trends report.
In fact, data privacy is one of only two trends that have gained importance in the past three years. (The other is higher purpose.)
That’s because the likelihood of cyber attacks is now a daily risk. In recent years, nefarious tendencies related to the risks of the “dark web” have been amplified, and many people fear that their personal information will be exploited by those with malicious intent.
Companies—and consumers—have good reason to be worried: According to the Identity Theft Resource Center, the number of data security breaches in the United States jumped from 157 to 1,244 between 2005 and 2018, with a peak of 1,632 in 2017. In 2018, that translated to 446,520,000 records exposed.
Not surprisingly, the rise of data security breaches has resulted in a majority of the public becoming doubtful about companies’ ability to protect their personal information. Specifically, 67.8% of the global informed general public is on the fence about whether companies have strong data and security measures, according to the 2019 Global RepTrak study. This percentage increased by 10.5% points in one year.
There is good news, though: In that same Global RepTrak study, the technology and financial services industries—two sectors that attract attention for the wrong reasons when it comes to collecting and protecting customer data—were seen as being among the highest performers on the delivery of data privacy assurances, with a strong rating in data privacy of 71.0 points and 70.4 points, respectively, out of 100.
“As a business, we hold confidential and sensitive customer data,” one reputation leader shared in the Global Trends study. “Any loss of this would have a significant impact on our reputation and the trust customers have in the company.”
Indeed, consumer data breaches provide a high risk to companies’ reputations; the negative sentiment associated with any company whose information is affected is high, according to a RepTrak media capabilities analysis.
All of this is cause to make data privacy a priority for your company today—if it isn’t already.
Director, Strategic Initiatives