How the retail industry faces data breaches in the UK  

How the retail industry faces data breaches in the UK  

Data breach frequency experienced a significant surge after the pandemic. People’s remote working systems and devices were exposed to risks due to a lack of knowledge and implications from companies, starting a long and dangerous trend of ignoring data security. Therefore, these cyber-attacks affected the entire world, leading to massive personal information leaks. EasyJet, Virgin Media and Interserve were only a few businesses whose systems were compromised in the UK.

However, organisations are still unprepared to face such an attack's consequences. Most don’t even realise how data breaches occur, while others state they don’t have the financial resources to update their systems. But those affected are losing money.

The Works, for example, decided to close some of its stores after a cyber attack interfered with supply stocks and deliveries by delaying them. This led to a product shortage of at least two months, impacting the entire retail sector, which is already sensitive to data breaches. But can it strengthen its security systems.

Data breaches in numbers ― over 9,000 cases in 2022

The UK’s data watchdog recently revealed that even if a tremendous number of data breaches occurred in 2022, the public debate wasn’t properly assessed since consequences are not seized rapidly. At the same time, it states that people are used to the amount of data social media platforms and websites collect to function, becoming immune to these occurrences. Luckily, GDPR rules allow citizens to open a data breach claim case in court if they suffered physical or financial damage.

But regular people are not the only ones affected by data breaches. Unfortunately, most small businesses in the UK are unprepared to handle a cyber-attack since their systems aren’t updated or secured by antivirus programs.

At the same time, hackers polished their practices in the past years, being able to take advantage of minor vulnerabilities. That’s why even corporations struggled with system hacks because complex ones, such as malware or DDoS attacks, hit them.

What cyber threats are most likely to target retail companies?

Retail businesses have an online shop for deliveries and client information that keeps the company alive in the era of technology. But what retailers don’t realise is this sector is targeted most of the time because it’s less prepared for emergencies.

Retailers hold a massive amount of data, like payment card information and personal data. Therefore, they should better protect their systems because this information might be useful for them but is also a valuable asset to steal from hackers.

That’s why ransomware, bots, impersonators, and third-party attackers mostly hit retail. Moreover, something companies also need to be wary of is the power of their employees. Unfortunately, this sector has some of the smallest wages but is packed with stressful working conditions. This means that workers might not give their all for the businesses, and they can also pose threats upon the end of their contract. Of course, this problem is extended to another issue that the entire economy of the UK must tackle.

How to establish retail cybersecurity as a company

Although data breaches cannot be entirely avoided, it seems like hackers are always one step ahead of companies’ technologies. However, they can implement ways to minimise risks in the long term, as well as decrease the likeliness of a breach to occur, so here’s what they can do:

  • Examine their payment channels to find vulnerabilities and also analyse the possibility of introducing a safer way for clients to purchase products;
  • Review their user access within the company to ensure not everyone can enter special documents and systems;
  • Audit their security protocols to see if systems are properly configured and to find the best ways to improve them;
  • Activate 2FA on all platforms available for a second security layer, whether it’s a password or a code provided to the customer;

At the same time, being aware of the current methods of breaching systems is vital for being up-to-date with the latest ways of securing the systems. Hackers always find new ways of breaking websites and either steal money or mess with the site. However, learning the signs of malware attacks, for example, allows for better and faster preparation for data safety.

Consequences of a data breach in retail

Retailers comprise the most important part of massive corporations because they connect the customer with the business directly and easily. But this strong connection comes as a disadvantage in the case of a data breach because it means that the system hack will almost instantly hit clients.

Customers whose data is stolen might never be able to recover it, which can influence their mental health. In some cases, they’re losing money. All these situations lead to reputational damage to the company, which is difficult to restore, considering that any company can easily be replaced due to high competition. Yahoo, for example, has never been the same after the massive data breach in 2013, when three billion user accounts were affected.

With reputational damage comes financial loss. On average, UK businesses lose from 100,000 pounds to 500,000 pounds, but there are cases when losses reach more than one million pounds. This can happen right after the data breach or in time, as customers sue the company for negligence. At the same time, operational downtime also contributes to losses since operations are disrupted.

Moreover, even companies can lose important data from their systems, such as employees’ personal data, IP address, credentials and biometric data. When data breaches expand in such a manner, it’s hard to handle the situation, which is why many companies either close their activities or continue working until they’re burdened with debt.

Cybersecurity isn’t kid’s play

Cybersecurity has been debated for a long time, but companies still seem to miss the point. More than 9,000 data breaches in the UK were recorded in 2022, but citizens have mostly ignored them. On the other hand, companies whose systems were broken massively were falling into disgrace, and they’ll probably never recover.

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