The threat of cyber attacks is on the rise, and so is the concern of retailers regarding data security. They are giving priority to this issue and investing considerably in technology and resources to prevent such attacks. However, fraudulent activities persist and the methods of attack are becoming more and more sophisticated.
Today, privacy concerns related to security breach is one among the top ten risks cited by 100 U.S retailers. A recent report on this says that the percentage of identified risk in 2014 accounts to around 91%. Even though there are adequate mechanisms to prevent attacks, some attacks unfortunately hit the target, affecting the data of millions. Recently the attention to data security and privacy has increased a lot. Why is it so? Let us look at some of the possible reasons.
Growing Security Concern — Some Possible Reasons
Greater need for Big Data: For retailers, accessing greater volumes of customer data is important for devising new business strategies and ensuring improved customer satisfaction. Conducting data processing and data analysis on big data and extracting useful insights out of it are essential for providing the tailored services that customers demand.
Technology Improvements in Data Storage and Transmission: Today, technology has improved to such an extent that many of the electronic devices have the ability to collect, store and transmit data. As this system of things is likely to expand in recent years, it becomes important to address the problems of information security and privacy.
Shattering Customer Faith and Trust: Cyber attacks in the retail sector usually aim at sensitive consumer financial data that can be used for financial gain. Such a breach can create a negative impact on consumers faith in the system and damage the relationship that retailers seek to build with their customers.
Reluctance in adopting advanced fraud prevention technology: Retailers often have little or no influence over some others involved in the payment segment, specifically card networks and banks. Even though retailers have tried a lot to make them adopt the 21st century fraud prevention technology, their efforts have not been very successful.
Staples — A Recent Example for Data Breach
One of the most recent instances of data security breach is that which happened (in high-profile retail outlets) at Staples. The issue has resulted in the loss of a huge volume of customer credit card data, a recent report says. According to the bank sources, fraudulent transactions have taken place at non-Staples outlets including supermarkets seven in Pennsylvania, at least three in New York City, and one in New Jersey. It is said that the breach must have occurred due to the point-of-sale (PoS) systems at the company being affected by malware that lifts credit card details and allows replicas to be generated and used. However, authorities are trying to find out the exact reason and are working to resolve the situation.