Follow Australia’s Lead and Reduce the Cost of a Data Breach
When it comes to data breach costs, Australia is onto something.
It was the only country in the latest Cost of a Data Breach survey by Ponemon to show a decrease.
The annual survey analyzed 383 companies in 12 countries including the U.S., the U.K. and Australia.
Globally, the average total cost of a data breach grew from $3.79 million to $4 million (this represents a 29% increase since 2013). The average cost paid for each lost or stolen record increased from $154 in 2015 to $158.
Australia alone however had a 6.6% decrease in the average total cost of a data breach – from $2.82 million to $2.64 million. The average cost paid for each lost or stolen record also declined from $144 to $142.
What are Australian companies doing right? In a article by Computer Weekly a regional expert isolated three important factors.
1. Better incident response and detection
The longer it takes to detect and contain a data breach, the more costly it becomes.
In the global study, breaches that were identified in less than 100 days cost an average of $3.23 million; after the 100 day mark, they cost on average $4.38 million. If it took less than 30 days, the cost to contain was $3.18 million. If it took more than 30 days, the cost was $4.35 million.
In Australia, the average detection and escalation costs decreased from $1.16 million in 2015 to $1.10 million in 2016.
One key to detection and containment is an incident response team, which can reduce the cost of a data breach by nearly $400,000 on average (or $16 per record).
2. Spending less on consultants and legal experts
After a data breach, engaging outside consultants will increase costs. Consultant fees include attorney fees, public relations services, crisis team management, temporary call center services, forensic activities, audit services, temporary IT staff, and credit monitoring.
Globally, outside consultants increased the per capita cost of a data breach by $5 per breached record.
But local companies in Australia spent less than half that amount on consultants and legal experts – the cost was $2.30 per breached record.
At the same time, reliable business partner can help. For example, an expert data destruction leader will provide up-to-date services and protocols in information security and workplace privacy.
3. Keeping customers after a breach
Lost business costs include the turnover of customers as well as increased customer acquisition activities, reputation losses, and diminished goodwill.
In Australia, these costs decreased from $0.89 million in 2014 to $0.84 million in 2015. The study concluded that “breached Australian companies were good at retaining customers”.
What helps to retain affected customers?
- A promise to do more in the future to protect systems;
- Notification in a timely fashion;
- Special offers (free service upgrade, waived termination fees);
- Other compensation (such as cash or products);
- Hotline support, credit monitoring services and identity theft protection.
There are many aspects to data breach costs. Find out how secure document destruction protects the workplace and the environment – and reduces the risk of a data breach.