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Study: Data Breaches Make Huge Impact On Brand Reputation
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Bprince
Bprince,
User Rank: Ninja
5/18/2014 | 12:46:36 AM
Re: Ummmm.......
I was going to bring up the decline in sales as well. I don't know if that is the case in breaches overall, but certainly Target took a hit in this case. I think it also may matter why the breach happened and how the affected company handles the response. With Target, there were questions raised about why this wasn't stopped, and lawsuits started flying. 

BP
Kelly Jackson Higgins
Kelly Jackson Higgins,
User Rank: Strategist
5/15/2014 | 5:23:42 PM
Re: Ummmm.......
Yes, there appears to have been at least some initial queasiness about shopping there after the breach--plus the remediation costs to Target for the aftermath. 
Kwattman
Kwattman,
User Rank: Black Belt
5/15/2014 | 2:58:35 PM
Re: Ummmm.......
If no one is "doing anything about it" - then why are target sales down 46%???
Kwattman
Kwattman,
User Rank: Black Belt
5/15/2014 | 2:56:42 PM
Re: Ummmm.......
If no one is "doing anything about it" - then why are target sales down 46%???
securityaffairs
securityaffairs,
User Rank: Ninja
5/15/2014 | 2:18:45 PM
Re: Ummmm.......
Data breaches represent a serious problem for companies, brand reputation is just one aspect. Ponemon has evidenced this, but I fear that asset damages, service interruption, response procedures and recovery activities have a similar impact.

 
Kelly Jackson Higgins
Kelly Jackson Higgins,
User Rank: Strategist
5/15/2014 | 11:30:52 AM
Re: Ummmm.......
It's definitely easier to stop shopping at Target (well, for maybe for some people, not me ;-) ) and go somewhere else than it is to switch doctors. It would be nice to see actual impact data on retailers and healthcare orgs.
armorguy
armorguy,
User Rank: Apprentice
5/15/2014 | 11:21:39 AM
Re: Ummmm.......
I absolutely believe that people say they will switch in the event of a breach.

 

But, when the inevitable breach happens, do they?  Only if they do make that change does the breached organization suffer any damage.

 

I am not aware of a valid study that has addressed this question.  My anecdotal experiences, especially in a healthcare environment, are that a few do but most do not.  People *like* their doctor and it takes a lot for them to take the effort to find a new one.
Kelly Jackson Higgins
Kelly Jackson Higgins,
User Rank: Strategist
5/15/2014 | 11:16:20 AM
Re: Ummmm.......
A recent Javelin study we covered showed similar consumer sentiments, even with their doctors: http://www.darkreading.com/attacks-breaches/consumers-ditch-their-breached-retailers-banks-and-doctors-/d/d-id/1234959?
armorguy
armorguy,
User Rank: Apprentice
5/15/2014 | 10:23:53 AM
Ummmm.......
So brand damage is "huge".  People are "outraged".  But they aren't doing anything about it.

 

Like so many studies from Ponemon this doesn't make sense.  If there were brand damage there would be consistent data showing sales impact directly tied to breach, long term stock price decline due to breach, etc.  But none of that exists.

 

If the premise were true the sponsor of the study, Experian, would have a highly damaged brand.  Do they?

 

To be clear I am not saying Larry Ponemon (or anybody associated with the Ponemon Institute) aren't good people nor am I questioning anybodys motives.  I'm saying that too many of their studies fail critical evaluation and *that* damages the Ponemon brand.


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