Businesses facing a surge in cyber incidents are encountering difficulties in attracting customers, according to a report by Hiscox. The annual cyber readiness report highlighted that nearly half of companies affected by cyber attacks reported significant challenges in customer retention compared to the previous year. The study emphasized that concerns over reputational damage were influencing firms to make ransomware payments, despite cyber security experts advising against it as a solution.
The report revealed that 70% of UK businesses witnessed an increase in cyber incidents in the past year compared to the previous year. In response, 46% of businesses struggled to attract new customers, while 43% reported losing existing customers. Additionally, 38% experienced negative publicity and 21% lost business partners, all higher figures than the previous year.
Eddie Lamb, the chief information and security officer at Hiscox, stressed the critical importance of protecting a business’s reputation in today’s digital landscape. He emphasised the significant effort and financial investment companies put into building their reputations, only to see them jeopardised in minutes by a cyber attack. Lamb highlighted the necessity for continuous cyber education within organisations to ensure every member understands their role in maintaining cybersecurity.
The report also raised concerns about businesses’ readiness to address the growing number of cyber incidents, with 37% of UK businesses feeling their cybersecurity measures were compromised due to a lack of expertise in managing risks associated with emerging technologies. Lamb urged business leaders to view technological innovation and cybersecurity as complementary aspects, encouraging them to invest in expertise to effectively manage evolving technology risks and safeguard their reputations.
In conclusion, the Hiscox report sheds light on the dual impact of cyber attacks on businesses, affecting both their financial stability and reputation. It serves as a reminder for companies to prioritise cybersecurity measures, educate their workforce, and stay vigilant in the face of evolving cyber threats to maintain customer trust and business resilience.