Consumers across the globe are seriously concerned about the data security practices of the companies they do business with, and would take their money elsewhere after a data breach, according to a new study.
Recent high-profile data breaches in the United States, United Kingdom, Australia and Canada and elsewhere have heightened consumers’ caution regarding data privacy and cybersecurity.
A surge in cybercrime is making consumers increasingly aware that they are not exempt from data breaches. People are also finding themselves forced to take matters into their own hands and resolve the damages caused by an organization’s weak data privacy practices. Because of this, they are starting to abandon businesses that fail to secure their data, according to a survey by PCI Pal.
For example, 83% of consumers in the US claim they will stop spending at a business for several months immediately after a security breach. 21% will never return to that business. In Canada, the results were similar. 58% of consumers claim they will stop spending at a business for several months post-breach, and a fifth will abandon their services outright.
The results are somewhat different across the UK and Australia, but similar between the two territories. In the UK, 44% will hesitate to do business with the breached entity for several months, and 41% will never return. In Australia, the percentage of customers is equal, at 43%, for both decisions.
“Whether it’s adjusting how much they spend or deciding to avoid the company altogether for several months or even forever, these figures represent significant potential revenue loss that many businesses may not be able to recover from,” researchers said.
Consumers also report that they trust the retail and travel industries least, that they are uncomfortable reading their credit card information over the phone, and that they are only comfortable sharing information over the phone to companies that have earned their explicit trust.
Researchers recommend that businesses take proactive steps to regain customer trust sooner, rather than later, before and after a data breach, by undergoing regular security audits.