Data breaches undermine consumer confidence

In the wake of massive data breaches at businesses, educational institutions and medical facilities, consumers are modifying their purchasing behaviour, including online buying

In the wake of massive data breaches at businesses, educational institutions and medical facilities, consumers are modifying their purchasing behaviour, including online buying, out of concern for the security of their personal information, according to the 2007 Consumer Survey on Data Security.

 

The survey from Vontu, a Data Loss Prevention solutions firm, and the Ponemon Institute, a privacy and information management researcher, found that 62% of respondents have been notified that their confidential data has been lost.

 

The two firms conclude that the high percentage of individuals that have been notified of a data loss event has contributed to increased security concerns, as the vast majority of those notified reported concern about the event. These data breaches have had a direct impact on consumer buying behaviour, including reluctance to use their credit or debit card to make a purchase with a Web merchant they don’t know, and unwillingness to provide their Social Security number online.

 

"Our research clearly shows that data breaches are affecting consumers’ trust in the organisations with which they share their data and, ultimately, their buying behaviour,” said Dr. Larry Ponemon, chairman and founder, Ponemon Institute.

 

The study finds that a majority of respondents are changing their purchasing behaviour due to heightened security concerns. Nearly two thirds of respondents have been notified that their confidential data has been lost; 84%  of those respondents reported increased concern or anxiety due to data loss events;  62%  of respondents said that they would be more upset with a company that lost their information due to negligence than if that company lost their information as the

result of theft.

 

 “We live in a wide open world where information can very easily be copied, sent or shared, and over 100 million consumers have been notified of a breach of their personal information. Unfortunately, this has led consumers to have significant concerns about the security of their data,” said Joseph Ansanelli, CEO of Vontu. “Smart companies understand this and are investing in solutions to protect against the loss of this sensitive data and ensure the trust of their customers.”

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