November 30, 2023
In an age where information flows freely, all businesses, regardless of industry or size, face the paramount challenge of safeguarding their customers’ sensitive information. According to the Identity Theft Resource Center, in 2022, more than 422 million individuals were affected by data breaches, resulting in 1,802 compromises. These statistics underscore the frequent and concerning nature of data breaches in the current business landscape.
Adding to the complexity of this situation, IBM's most recent report highlights a concerning rise in the average cost of data breaches globally, reaching $4.45 million in 2023, compared to $4.35 million in the previous year. The United States faced a significant financial burden, with an astonishing average cost of $9.48 million for a single data breach. The economic implications of these developments are profound and potentially daunting.
Small businesses in particular can face severe consequences when data breaches occur. These businesses could face regulatory action, fines, legal expenses, and the loss of valuable customers, which can cripple operations. In this challenging landscape, further exacerbated by inflation, rising prices, and ongoing supply chain issues, business leaders have to make tough decisions regarding their budgets and priorities. Unfortunately, the critical need for data protection can often take a backseat in these trying times.
A budget for data security is not just an option but a necessity, as the cost of inaction can be devastating. Fines and the loss of customers loom ominously, with a recent Ping Identity consumer report revealing that 81% of consumers would cease to engage with a brand online following a data breach and 25% responding that they would sever connections with the brand entirely.
To help mitigate the risk of a data breach, businesses should adopt a proactive approach, embracing measures to protect both digital and physical data, including proprietary business records, employee files, tax documents, customer information, medical records, and computing equipment. In an era of unpredictability, businesses must stay ahead of the curve, fortifying their defenses to help protect their future.
The 2023 Data Protection Report (DPR) by Shred-it® sheds light on the importance of data and information protection among small business leaders (SBLs). A staggering 78% of SBLs surveyed responded that they do not adopt an extremely proactive approach, a figure even higher than the previous year. Notably, 77% expressed concerns about the impact of data breaches on their customers, yet their efforts primarily revolve around passive data protection actions, such as software updates and anti-virus deployments, for safeguarding sensitive information.
Moreover, only 25% of SBLs reported collecting and disposing of sensitive materials when they were no longer needed, including printed materials and hard drives. SBLs should prioritize the protection of their company's sensitive physical materials and implement more stringent data security measures.
As part of the actions taken by respondents to help ensure the security of sensitive data and confidential information, the DPR highlights the following data security measures:
Learn more about how to proactively safeguard your confidential information using Shred-it®'s secure shredding and hard drive destruction services.