How data security helps bring in the money?
When you talk about data security, people often think about hackers, insider threats, rogue employees, and cyber criminals. Then they think about the consequences, loss of trust, the hit on the company’s reputation, lost customers, and the hefty regulatory fines and other charges.
Very few, however, think about data security as a key feature of your product, service, or company. This is an important feature that would help you keep your competitors at bay and bring in more sales or increase your revenue.
Data security has always been one of the things that companies moving to the cloud focus on. And this should be the case because data security helps support compliance, reduce costs, and lower risks.
Over recent years, data security has become even more important with the increase in incidences of data breaches being reported. What’s more, there are now more sensitive data being transmitted and shared and, with the advent of the cloud and mobile, IT environments have become increasingly complex.
Is it any wonder why the data security market is exploding? In fact, research firm Markets and Markets recently estimated that the database security market alone would increase to $7.01 billion by 2022 from $2.57 billion in 2016. This represents a compound annual growth rate of 18.9% from 2017 to 2022.
Even so, very few businesses and technology professionals think of data security as something that increases their revenues and bring about positive results. In short, while CIOs can appreciate how data security can lower costs, they do not see it as something that can generate revenues.
But if you really look at things, you will see that data security might be used as a strategic differentiation that would set your products or services apart from the competition.
So how does data security become a differentiator for you?
1. Data security inspires trust in your customers.
In 2017, it is estimated that the average cost of one data breach is around $3.62 million, while a stolen record with confidential or sensitive information will cost a company an average of $141 per record.
Both of these figures represent a decline, the average cost of a stolen record in 2016 was $158, while data breaches were 10 per cent more expensive.
The report also found out that an average data breach would involve at least 24,000 records, which means that data breaches in 2017 were 1.8 per cent bigger than the previous years.
The said study does not only drive home the point that data security can help save you money. The report factored in the income lost because of lost customers.
Like it or not, people often take trust into consideration when deciding on a service provider or a merchant. If they cannot trust you, they will not give you their information or their money. The issue of trust has been highlighted in recent years when a lot of high profile breaches made it mainstream.
There are also new regulations, such as Europe’s General Data Protection Regulation (GDPR), which makes data security a part of everyone’s daily conversation.
Deloitte also estimated that close to three out of four customers would consider doing business with another enterprise if their current company cannot keep their data safe. That is big. In contrast, only about half of customers would switch if you charge higher prices for the same product.
This only shows that data security could be a good differentiator. If you can show that you can keep your customers’ data safe, then you have an edge over competitors who fail at data security. This is especially true if you keep your customers’ financial data such as credit card details and banking information.
Put yourself in the shoes of your customers. Would you trust a company who has had a data breach incident in the past and still give them your credit card numbers?
2. Data security can bring about digital transformation faster.
Digital transformation is more than just a buzzword. It is when you use digital technology to do something better, such as using big data analytics to drive up sales, or using smart devices to deliver IT services.
Because digital transformation involves technology, it really cannot prosper without security programs in place. You need to include data security when you plan for digital transformation. When you are able to secure data, you are more able to share it around without worrying about breaches, leakages, privacy violations, and even ethical violations.
Jaime Sáenz de Tejada, chief financial officer at BBVA, credited digital transformation with the bank’s continued growth. BBVA has started offering 90% of their products and services to mobile customers. Saenz de Tejada reported that digital clients now comprise around 40% of their customer base.
Now imagine how BBVA would fare with their digital transformation initiatives if they cannot keep their customers’ data secure?
So how do you do this? Start with your employees!
First, you should communicate to your employees the importance and benefits of data security. This will not only help your employees understand why data security is important in the first place, but also enable them to participate in the process. Instead of whining about how data security would mean additional work, they would feel like they are actually contributing something to the organization.
This is especially important because a lot of people often willfully disregard security when they do their jobs as Forrester Research found out. Not only that, they did it because they thought that data security protocols were not reasonable or necessary.
More than raising awareness on the importance of data security, you should also communicate how this drives more revenues. And lastly, converse to your employees how most breaches are caused by employees’ mistakes and carelessness.
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Focusing on data security can help you gain your customers’ trust, enable digital transformation, and increase your revenue. It is very easy to see how data security is now considered a business driver, rather than just a task you need to do. It is no longer just a way to cut cost, but also a way to earn more.
Photo courtesy of Pictures of Money (Flickr).