CIO Today asks the right question for today here. 

Intrusion – How Much Is Customer Trust Worth?

Imagine how your customers, who value their personal information and privacy, would feel if they realized their data were being sold to the highest bidder and that your company does not have a foolproof data privacy and protection plan. Imagine the negative “word of mouth” that could instantly spread in a blog about your company.

It goes on to say that a strategic shift is required in how firms think about information.

What is the impact of data theft to your company, your customers, their trust and subsequently your bottom line? It’s insurmountable, unless the need for data privacy and protection moves from the server room and the legal beagles to a corporate-wide customer strategy in which every employee is responsible for protecting customer data.

This is backed up by recent research.

Gartner’s recent study about online security shows customer confidence is rapidly eroding. 

Which is further backed up the Statistics Canada research I blogged about earlier today.  In short the concerns about privacy & security are at least twice what they were are recently as 5 years ago.

Identity theft is no longer something that happens to the ‘other’ person. 

According to the FTC study, nearly 10 million consumers were victimized by some form of identity theft in 2004 alone. That equals 19,178 people per day, 799 per hour and 13.3 per minute. Consumers have reportedly lost over $5 million, and businesses have lost an estimated $50 billion or more.

In conclusion

The Bottom Line on Customer Data Privacy and Protection

Privacy and protection are competitive differentiators. For a company committed to its customers, the data protection interests of the customer and the company must be synchronized. 

If customers are a company’s true source of value creation, then maintaining their trust is imperative. When companies understand this, privacy protection will become an important business tool, rather than just a regulatory requirement.