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The effects of data breaches on consumer trust run deeper than you think


By Marty Greenlow | Chief Executive Officer

January 28, 2019 | 5 min read

Plenty of companies—and industries as a whole—have lost the trust of U.S. consumers in recent years due to poor data stewardship that results in serious data privacy breaches. From a marketer’s perspective, such incidents take a heavier toll on consumer trust than you might think, and it’s time to take responsibility.

The effects of data breaches on consumer trust run deeper than you think

Although the costs associated with regulatory fines and lawsuits following a data breach can be severe, perhaps no effect is quite as long-lasting or harmful as the loss of consumer confidence that accompanies these breaches. Consumer trust is not built nor can it be earned back overnight. In fact, earning back consumer trust these days is tougher than ever.

That’s why marketing executives today must be heavily focused on preventing data breaches, rather than just resorting to damage control if and when they occur. While this might seem obvious, you’d be surprised by how many marketers today are unaware of their vulnerabilities and their level of responsibility in preventing these incursions.

When consumer trust is gone, it’s often gone for good

Consumer trust and loyalty are particularly fragile these days, given the disruptive nature of so many industries. When enterprises experience highly publicized data breaches, there’s often a host of smaller players with non-traditional offerings waiting in the wings, eager to scoop up customers who have lost faith in their previously trusted partners.

In addition—and perhaps counterintuitively—the nature of an organization’s damage control following a data breach often prohibits the type of marketing and communications required to reestablish trust with consumers. In the wake of a breach, it’s quite common for a company’s legal team to be elevated in its role with regard to external communications and future decisions. While this is understandable, it often means that companies go relatively silent in the wake of a breach. Communications that are issued tend to be steeped in legalese, which is not exactly the type of language that eases people’s concerns.

Longer term, the infusion of greater legal checks and balances into an organization, though prudent on the surface, can stall innovation and stifle marketing and consumer communications within an organization. The result is that, even after the initial damage done to consumer trust, those vital relationships continue to erode.

An ounce of prevention isn’t enough

The surest way to foster consumer trust is to proactively protect consumer data properly. Again, this point might be obvious. But what’s less obvious is exactly how organizations can do that.

Few marketing leaders understand where their company’s data breach vulnerabilities exist and how to protect against them. Most assume that their IT or security teams have the company covered, but in fact, a company’s senior executives are the ones responsible when an organization experiences a breach. And a surprising number of breaches today are originating with the marketing department.

Most marketing executives associate the idea of a “data breach” with malicious hackers and denial-of-service attacks. But data breaches come in many flavors. Many originate from third-party marketing technologies on their websites that they do not control; for example, trackers, tags, ad servers, and social media technologies. These tools, some of which companies might not even be aware of, can introduce malicious code to a site or lead to the leakage of sensitive customer data to third parties. These types of breaches are preventable with the right technology, but few marketing executives are aware enough of these threats to implement protections prior to a breach occurring.

It’s time for marketers to prioritizesecurity within their organizations. Given the devastating effects that even a single breach can have on consumer trust and, thus, the long-term health of an organization, a proactive approach to marketing security isn’toptional. It’s essential.

Marty Greenlow is chief executive of Ensighten

Modern Marketing Technology Digital Advertising

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