How Can a Data Breach Affect Brand value?

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How Can a Data Breach Affect Brand value?

Every week, the news of a data breach makes headlines.  What’s important to note here is that the impact of a data breach is way more than the concrete expenses and resources used to manage the breach.

Studies reveal that a data leak can seriously damage a company’s image and brand value. It can harm the goodwill of a brand and cause a loss of client trust.

As per the Risk Based Security research report, in 2019, over 5000 breaches were reported, exposing 7.9 billion records. A data breach is not just a matter of privacy concern; it concerns all the stakeholders interested in protecting the brand’s name.

Whether it’s a global brand or a mid-size company, or a small organization, a data breach will hurt all. It can draw the attention of the media, which will result in bad publicity, especially when customer personal information is at stake. Moreover, a data leak can destroy your brand value and poorly affect your stock performance. It can have a direct impact on the value of your acquisitions.

According to the 2018 Cost of a Data Breach Study conducted by the Ponemon Institute and IBM, you can study the factors that alleviate damage whenever a data breach happens and those that might increase the damages.

The full report can be found here: 2018 Cost of Data Breach Study. However, the total cost of Data Breach can be mitigated if certain steps are followed.

According to a study, a data breach might cost up to US$3.86 million, and the cost of stolen or lost records will sum to US$148. This shows a huge increase as compared to the 2017 report. 

Although, the best attempt is to avoid the chances of a data breach. If a data breach happens, a few vital steps must be followed by an organization to mitigate the losses and to preserve the trust of the customers. 

  • After a data breach, a Chief Data Security officer responsible for keeping customer trust and mitigating customer loss must be appointed.
  • Must offer identity protection after a data breach to reduce customer data loss along with mitigating the cost of a breach.
  • The research also demonstrated a vital connection between the cost of a breach and the speed of the response given to it.
  • The quicker you contain your data leak, the lesser the cost to manage it; however, it is important to first understand the status completely before sharing any notification with your customers, or else it may increase the cost of the breach.
  • Using encryption within your company can reduce the total cost.
  • But, if a third party were behind the data breach, the cost would increase.
  • Also, businesses must take steps to authenticate the security for the third party and proactively train and designate the internal resources. Moreover, efficient management of escalation and detection can majorly reduce the cost of the data breach. Steps must be taken to identify business recovery, disaster recovery, and crisis management. A well-defined plan can help in quicker containment and reduce the overall cost.

Data Breach Facts

  • The cost of a data breach has increased by 6.4% by the end of 2018.
  • The cost of lost records increased by 4.8%.
  • The breach size has also shown an increase of 2.2%.
  • South Africa reported the highest probability of data leak as 43 percent, and Germany said the lowest probability was 14.3%.
  • The manufacturing sector witnessed massive data breaches.
  • 48% of data breaches happened because of criminal attacks or malicious cyber content.

Additional facts 

In addition to the research mentioned above, a report was recently released from Verizon tracking 41,686 security attacks in all parts of the world, including over two thousand data leaks from 86 nations and 73 data sources. Also, here is some additional information:

  • The report authenticated the significance of being prepared for an attack before it occurs, especially having a successful plan to contain the breach.
  • Ransomware cyber-attacks are imposing a serious threat to all types of industries worldwide. 
  • 43% of Data Breach attacks occurred in small businesses, 15% happened in public sector entities, 15% in the healthcare industry, and 10% in the financial sector. 
  • Social media, hacking, and malware are the most common security risks used to perform cyber attacks.

Today, technology has become an essential part of our everyday life; we belong to a data-rich society. Because of this, cyber-attacks have also become a part of our day-to-day lives. 

For businesses, It has a direct impact on building the trust of your customers. This will have a huge effect on the affinity of your brand and customer engagement as well. Although, some impacts can affect your business in the long term and spoil the relationship between your brand and your customers. 

The Verizon report guides brands to understand their worth and risk because of a data breach. It provides relevant insights to implement a streamlined cybersecurity plan to protect data, apps, systems, and networks and maintain constant vigil from the ever-present cyber security threats.

Financial gain has always been the most significant motive behind data breaches. These breaches allow opportunistic criminals to destroy and compromise sensitive data. To save the reputation of their brands, the owner is forced to pay a heavy amount, 

In a study, Interband and Infosys recently calculated the highest threat to brand value because of data breaches. According to the list of Interband, considering the 100 Best Globals Brands, the most elevated threat of data breach will be eleven percent of your brand’s value. Although this value might not seem dramatic to you, you will be amazed to know that it can reach more than a hundred percent of your net annual income. However, the exact value might differ from sector to sector. Every industry suffers losses according to its net worth and brand value. 

How to avoid data breaches?

Web applications and websites are the most vulnerable and visible section of any company’s infrastructure, so it is quite obvious that cybercriminals can easily scan these websites every minute and look for vulnerabilities. However, a lot of breaches occur through the assets which are not well tracked, i.e. shadow IT assets and assets which are unintentionally exposed on the internet. 


While web apps and primary android apps are generally carefully tested for security, untracked assets are more tempting targets as they are easy to exploit once identified. Examples of these could be, exposed internal portals, vulnerable components, legacy assets, admin panels, exposed private repositories, docker images, etc. 

  • Educate your staff. A major reason behind data breaches is the mistakes that happen by human resources. Because of employee error, your company can face devastating data leaks. It can cause serious damage to all aspects of your company. Therefore, it is critical to train and educate your workforce to avoid these errors at every step. 
  • You can also opt for perimeter security that can protect your company’s network from intruders, hackers, and unwanted individuals. It involves analyzing patterns, recognizing threats, and surveillance detection. Every private network must have perimeter security to safeguard itself. 
  • It is also important to identify your unknown assets that are exposed to cyberattacks or are not covered by the current security solutions. It helps you to cover your attack surface by prioritizing your assets and vulnerability analysis. 
  • It is also essential to check your web apps and websites to see whether they are protected appropriately. Ensure the use of specialized tools specifically designed and built to preserve highly-sensitive and visible infrastructure and brand assets.
  • It is very important to draft a strategy to manage your security plan. It will help you in appointing the right experts at the right positions. You can also pick up the best security tools and efficiently understand the hacking trends to explore and fix the potential risks and threats and to avoid future cyber attacks.
  • You must understand that sometimes technology cannot fix everything. Therefore, you need support from the professional security team of expert engineers 24 x 7.
  • Do you have a backup plan? It would help if you prepared a crisis plan too. What will be the first thing you’ll do with whom you will communicate in case of a data breach? How will you regain the trust of your customers? How to avoid its impact on your brand value?

How Attack Surface Management Solution can help? 

ASM solutions help you get visibility of your attack surface and thus be able to reduce the same by eliminating assets from the public exposure. For example, an admin panel that is not needed to be accessible on the internet must be kept behind a VPN or restricted to internal networks. 

Furthermore, solutions like NVADR, help not just discover assets, but also uncover security risks/data leakages that can have catastrophic effects on your organization and result in a breach. 

These solutions also help keep track of all the technologies running across the organization and thus if a new vulnerability is identified in a specific stack, you are in a position to be on top of it before it is exploited. 

What to do after a Breach?

So, if you find your business in a situation like this, it means that your brand is under a huge threat and might be a victim of cyberattacks. 

You must conduct an investigation immediately to understand the situation completely. This investigation will help you know how deep this breach’s impact is. It would help if you communicated the investigation findings with the concerned executives. Also, you need to share it with the affected customers to be transparent and timely throughout the entire process. Do everything that can help you win the trust and heart of your customers. This will be the only way to win back their loyalty and trust. 


Hope that the content mentioned above will help you understand data breaches and their impact on your business and how you can avoid or recover from them. It is important to realize that industries can witness a data breach or data leak anytime and anywhere. How much you have prepared yourself to withstand such criminal attacks matters. For more information, you can read blogs at

Keeping track of all externally exposed assets on the internet and security issues around these assets is a good start. Reducing the Attack Surface is a proactive step and must be considered by tech-heavy organizations. As we know, Security is not a one-time affair, all these steps must be done on a continuous/periodic basis so that vulnerabilities don’t sit on the Attack Surface for long.