Building Trust After a Data Breach

When choosing to do business with a company, a customer places a certain amount of trust in the people running that company. It’s assumed, for instance, that the credit card information a shopper enters at checkout will be kept safe from hackers and fraudsters.

Unfortunately, even with the best security, fraud sometimes happens. And once a data breach occurs, it’s important to focus on moving forward rather than the past. There are always measures you could have taken to strengthen security, but identifying and repairing the issue should be top priority. Once you have that under control, it’s time to work on public relations, with the end goal of gradually rebuilding the customer trust relationship you once had. Here are a few steps you can take to rebuild trust.

Be Honest

One of the biggest mistakes a business can make following a breach is dishonesty. Even if you’re lying by omission, the truth will eventually come out. It’s best to be honest, releasing information about what you learn when you learn it. If you state that only a few hundred customers were affected, for instance, and it later came out that the number is actually much larger, you’ll look like you’re hiding things.

Answer Questions

Following a data breach, it’s especially important to carefully monitor your online reputation. A 2014 study revealed that 85 percent of retail data breach victims said they would tell others about the incident, with 34 percent saying they’d lodge a complaint on social media. Another 20 percent said they’d comment directly on the retailer’s website. When these complaints appear, you should have someone in place to expertly respond.

Be Patient

Despite its troubles in December 2013, Target has rebounded well, posting better-than-expected sales for its 2014 holiday season. The company’s continued success illustrates that even after a highly-publicized breach, a company can come back stronger than ever. Businesses should realize that rebuilding customer trust takes time. Over the coming months and years, gradually time will distance customers from the issue and business will continue as usual.

Offer Credit Monitoring

Following a data breach, each customer is primarily concerned about his or her own safety. Knowing their data has been compromised leads them to worry about whether they’ll fall victim to identity theft. By offering your customers that form of protection, they’ll have the peace of mind of knowing their data is safe. It also sends the clear message that you care about your customers and want to do whatever you can—at your own expense—to protect them. While this will be an initial out-of-pocket cost for your business, many of the customers you contact won’t sign up for credit monitoring, so you’ll only pay it for the customers who sign up for it.

A data breach can be devastating to a business. But when handled correctly from the start, a company can rebuild trust and come out with a better relationship with its most loyal customers. As you assess your business’s readiness for a data breach, consider whether you have the resources to conduct public relations following an incident in addition to the security resources you’ll need.

Read Ramon’s earlier post in our Data Breach series, including how to prevent and detect a data breach — and what to do if you get hacked.

Ajeet Khurana
Ajeet Khurana
Ajeet Khurana wears many hats: author, angel investor, mentor, TEDx speaker, steering committee of the NASSCOM Start-Up Warehouse, Director of Founder Institute, Venture Partner with the seed initiative of a top Venture Capital firm, and former CEO of IIT Bombay’s business incubator, among others. Before all this, he was entrepreneurial twice in the field of education and web publishing. As a lecturer at the University of Texas at Austin, he taught e-commerce back in 1993, when the term "e-commerce" had not yet been coined. An undergrad in computer engineering from the University of Mumbai, and an MBA from the University of Texas, Ajeet is presently an active name in the startup ecosystem. From starting two ventures as a solopreneur, to helping a large number of startups with their go-to-market, he has never shied from getting his hands dirty. At the same time he has helped dozens of startups raise investment. He truly believes that small business owners are driving change in the world, and need to be facilitated as much as possible. Innumerable small businesses have gained from his attitude, vast professional networks, financial acumen and digital mindset.

See all posts by Ajeet Khurana
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