Cyber risk in consumer business
Challenges faced by companies in the consumer products, restaurants, retail and agribusiness sector
As businesses use emerging technologies to redefine the customer experience, they find that these technologies also create perils, especially around cyber risk. From customer trust to intellectual property, consumer businesses discuss the six main cyber risk challenges they face today.
- Six areas of focus for consumer business companies
- Challenges and opportunities
- More information on cyber risk in consumer business?
Six areas of focus for consumer business companies
Many businesses are leveraging innovative technologies to help enhance the customer experience, build loyalty, and, perhaps most importantly, remain competitive in a digital world. However, companies should consider balancing their expanding digital footprints with a growing focus on cyber risk. Emerging technologies are often attractive avenues of opportunity for cyber criminals looking to expose weaknesses in an organization’s digital ecosystem.
The road forward will likely not be an easy one. Consumer businesses face numerous challenges as they attempt to handle the complex issues of cyber risk. As such, we have identified the following six themes that companies should consider:
- Executive-level engagement: For many organizations, the responsibility for preventing, managing, and recovering from cyber incidents tends to be highly fragmented. Consumer businesses should consider gaining a better understanding of the cyber risk landscape in order to establish a more effective structure to own this critical issue across their organizations. There is also a significant opportunity to strike a more effective balance between investing in the right advanced technologies to move businesses forward while ensuring that in doing so, they are not opening themselves up to increased cyber risk.
- Customer trust: Today’s businesses may be skating on thin ice when it comes to potential consumer backlash from cyber breaches. Longitudinal research across thousands of consumers reveals a heightened state of uncertainty around data security over the past decade. Businesses should not only consider how perceptions of uncertainty about the privacy of personal information may impact future purchase decisions but also assure their customers that they are taking appropriate steps to mitigate cyber risk.
- Connected products: The future success of connected products is likely dependent not only on the technology that facilitates connectivity but also on consumer trust, which can drive demand. The rapid growth of connected products not only presents numerous potential benefits to consumer businesses and their customers but can also increase cyber risk. It is essential that consumer businesses ensure the security of connected products if both businesses and consumers are to reap their benefits.
- Payments: Emerging payment technologies are enabling businesses to elevate the customer experience by streamlining and, in many cases, reinventing the payment process. Companies that are able to leverage emerging payment technologies while maintaining a focus on the security of these platforms will be positioned to gain from their implementation. Technologies such as emerging payment systems that provide new and efficient customer experiences are also being targeted by cyber criminals.
- Intellectual property: Intellectual property (IP) drives a company’s innovation, competitiveness, and growth. The evolving nature and rising incidence of IP theft require a comprehensive cyber risk approach around identity and data access management.
- Talent and human capital: An organization’s ability to effectively and efficiently manage cyber risk should be part of its culture. Talent can be the weakest link in the cyber landscape. In order to mitigate this risk, it is imperative to attract, train, and retain top cyber talent while implementing educational programs for all employees on the role they play to minimize risk across an evolving digital landscape.
Challenges and opportunities
Looking at the Consumer Business Industry, there are specific opportunities for the consumer products, retail and hospitality segment.
Smart consumer products (from lighting solutions, to cars, to toys for children) provide extended functionality, which provides improved and tailored product experiences to users. They do, however, require manufacturers to take into account cyber risks that ‘dumb’ products do not face. Secure product development requires security engineering capabilities to be present in R&D and innovation departments. Products that connect back to platforms operated by manufacturer require coverage by security operation teams, with capabilities including security monitoring and incident response, and measures to protect customer personal and payment data, if applicable.
Retailers can address their supply-chains and customer experience in their security strategy. Digital supply-chain networks allow for improved and accelerated data sharing and vendor processing, which optimizes the retailer’s supply-chain. To be successful, system integrity, data confidentiality and maintaining of trust between parties are essential. At the same time augmented reality, data-analytics and payment innovations allow for mixed physical-digital customer journeys, tailored to individual consumers. These developments make next-level identity and access management a key security capability in retailing.
As hotels and restaurants alike want to provide internet access and digital services (from music and video streaming to reception-less hotels) to their customers, they have to find the right balance between marketing, privacy and abuse prevention. Key security capabilities to address these challenges are micro-segmentation and fine-grained web access controls. Many large hotel and restaurant brands work as franchises, meaning that risks that a local franchisee takes can impact the global brand. Therefore organizations should provide both clear guidance and expertise to make sure franchisees are able to address cyber risks properly.
More information on cyber risk in consumer business?
Do you want to know more on the cyber risk in consumer business? Please contact Martijn Knuiman at +31 (0)88 2882941.