What you’ll learn
- How digital commerce has made customer trust a crucial factor for businesses
- The importance of earning and maintaining customer trust
- Best practices for maintaining online security in the digital age
Customer trust remains paramount in the digital age, yet its dynamics have evolved. The rise of technology and internet connectivity has changed how we do business.
Companies can now expand their reach beyond geographical boundaries, allowing customers to execute transactions worldwide. The new modern commerce era demands a robust and constantly evolving online presence to ensure customer trust.
In this blog, we'll discuss the importance of customer trust and how it ties into online security. We'll also explain why online security is necessary for businesses to remain successful.
Rise of Cyber Threats and Attacks
Operating online exposes businesses to the harsh reality of cyber attacks. A single data breach or software disruption can have devastating consequences on both current and future earnings. In fact, according to IBM's Cost of a Data Breach report, the average data breach cost exceeded $4.45 million in 2023.
The impact of data breaches extends beyond financial losses. They erode customer trust and loyalty, making people increasingly wary of entrusting sensitive data to your software. If not addressed properly, this sentiment can drive customers away to your competitors.
High-profile companies like Equifax, Marriott International, and Meta have all fallen victim to significant breaches, resulting in legal consequences and severe damage to their reputations. Equifax, for example, incurred a staggering $425 million in costs following its 2017 breach, a portion of which was allocated to assisting those affected by the breach.
Best practices for maintaining online security
Prevention is the best security approach.
The most common methods of preventing cyber-attacks and data breaches include:
• Encryption - Encryption technology secures information by encoding messages so only the intended recipient can read them.
• Firewalls - A firewall acts as a barrier between an organization’s internal networks and external sources, allowing system administrators to control which types of traffic can enter or leave their networks.
Employee training makes a difference as well. Employees should be briefed on security protocols and handling confidential data.
Reputation Management
The value of a positive online reputation cannot be overstated. Customers rely heavily on online research, and a good reputation is a lure to attract new business. It demonstrates credibility and brand value.
By contrast, a negative online reputation is often crippling. News of a data breach or security incident can poison brand search results and alienate potential customers and users. The negativity carries financial implications as well.
Research shows that the average publicly traded company experiences a 7.5% decline in stock value after a data breach. Small businesses take the hit even harder, with 60% going out of business within six months of the attack.
It's essential to control your brand narrative, even after a breach. You need a solid reputation that can withstand temporary negative press.
Best practices
Protecting your company's online reputation can take real work. As an IT professional, maintaining a positive online image that resonates with peers, stakeholders, and potential clients can make all the difference in gaining the trust of buyers and customers.
Here are some fundamental strategies to consider when managing online reputation:
- Proactively Resolve Issues. Bugs and vulnerabilities are inevitable in IT systems, but how you address them sets you apart from the competition. If a mistake or challenge arises, openly acknowledge it and communicate your mitigation strategy. This transparency demonstrates accountability and a dedication to rectifying any setbacks.
- Respond to Queries in a Timely Manner. Similarly to how system glitches should be addressed promptly, ensure you respond swiftly to inquiries and comments on your digital platforms. Whether it’s a question about a recent software release or a clarification on your response to a previous system glitch, a quick and knowledgeable response builds rapport and reinforces your commitment to security.
- Showcase Security Practices. Customer trust starts with transparency. By utilizing a Trust Center on your website, users can easily find information about your security protocols, data protection measures, and privacy policies without ever having to ask you. This transparency not only reassures clients but also underscores your commitment to safeguarding sensitive information.
Data Privacy
Data privacy refers to the security and handling of personally identifiable customer information. Data that must be protected include email addresses, phone numbers, and bank account information.
Without data privacy, there's no customer trust. A breach could harm the customer even more than it damages the business. Equifax's $425 million settlement was paid to victims of its breach, and it still didn't fix the company's reputation. As a result, Equifax has a 1.1 Trustpilot score.
Data privacy isn't easy to guarantee, but there is a lot that you can do to minimize the risk of a breach. Encryption makes it harder to read stolen messages, strong passwords help keep bad actors out of your accounts, and continuous updates and systems checks can alert you to suspicious activity.
Building and Maintaining Customer Trust
At the core of your values should be the commitment to ensuring the security of customer data. Proactive transparency should be your guiding star in every facet of your operations. Make it a goal to anticipate customer questions and concerns, and offer the information they’ll need before they ever ask for it. Providing information such as how personal data will be used, stored, and shared can immediately gain the trust of customers.
Honesty forms another vital pillar that should extend to every part of your business. When your software streamlines accounting hours by 10, proudly stand by that statement. Accurate representation can have a powerful impact on customer trust.
Effective communication is another vital pillar on the journey to building lasting trust. Promptly addressing messages and calls can ensure your customers that their input is valued and heard. Messaging around updates to security or privacy protocols should be easy to understand, underlining your commitment to keeping users informed.
Lessons in Trust Building
Apple, Amazon, and Costco are prime examples of corporations successfully building unwavering customer trust. Apple has gained the trust of millions by committing to creating innovative products with cutting-edge security features. Amazon's focus on convenience, low pricing, and exceptional customer service has established a reputation for reliability and trustworthiness. At the same time, Costco is known for its generous return policy and commitment to quality products, reinforcing its commitment to customer satisfaction.
Conclusion
Customer trust is a crucial part of business success. Companies with secure online practices, strong reputation management strategies, and proper data privacy measures are far more likely to build customer loyalty and trust.
Highlight customer service with honest, timely customer conversations to maintain trust. Your IT team can focus on technical details such as enforcing encryption and enabling firewalls.
SafeBase is the scalable Trust Center that automates the security review process between buyers and sellers. With a SafeBase Trust Center, companies can seamlessly share sensitive security documentation with buyers and customers, including streamlining the NDA signing process by integrating with your CRM and your data warehouse.
If you’re ready to take back the time your team spends on security questionnaires, create a better buying experience, and position security as the revenue-driver it is, get in touch with us.
