Technology

Why 60% Of Small Businesses Fold 6 Months After Getting Hacked

What would happen if your customer’s sensitive data got hacked? Would your business be able to survive, or would it be a catastrophic deathblow? Billion-dollar multinationals get hacked every single day. They are popular targets for hackers because of their scale and their profile.

However, most of these companies can recover and mitigate the damage in a couple of years or less. Data breaches for small businesses are a much bigger deal. If you’re worried about data security, we highly recommend you upgrade your data hosting.

You can start right now and compare data centers with UpStack to find out what’s possible. Your small business has a 60% chance of declaring bankruptcy or closing your doors forever after a data breach. And it usually happens in less than six months. Here’s why.

IMAGE: PEXELS

The Damage To Your Reputation And Your Brand

The multinational mega-companies that get hacked have millions of dollars allocated to emergency communication plans. They also have call centers full of customer service agents that can quickly respond to phone calls and social media interactions with preapproved communication. You, on the other hand, do not.

These bigger companies are poised to turn a crisis into an opportunity by offering frustrated customers individual attention. This can actually turn them from a detractor to an advocate. The crisis becomes a success story.

You might be able to do that if you take an all-hands-on-deck approach to handle the influx of calls, emails, and social media interactions about your data breach. You can also set yourself up to be in a position to respond quicker if you already have boilerplates and templates created well before any sort of PR nightmare.

However, the sad reality is that most start-ups and small businesses simply don’t have the time or resources to control the narrative. The end result is their brand name and their reputation being irrevocably damaged. Their name is sullied, and this data breach forever scars their web trail. Their customers feel like they can’t trust them anymore, while future customers don’t even think about trusting them.

Your Competition Is Poised To Capitalize

Your competition gets to play the role of hero after you come off looking like the bad guy. Their sales funnel is about to fill up with your dissatisfied customers, and all they have to do is convince these leads that they’re more trustworthy than a company that just got hacked.

You have also just gift wrap them a cautionary tale and case study about how they need to protect their own network. If your businesses are very similar, they can see exactly how you were hacked and where they need to beef up their own security. Of course, they then get to tell your former customers all about these security upgrades that will protect their data.

It is possible to weather this storm and survive a data breach with small-business-level resources. However, it is tough and often expensive. Most businesses simply can’t survive the damage to their reputation and the enormous favor they just did for their competition.

So, they are forced to close up shop and close their doors forever. We hope you found this article helpful, and now you won’t half to experience a hack firsthand to see how devastating it can be! Consider this your cautionary tale!

If you are interested in even more technology-related articles and information from us here at Bit Rebels, then we have a lot to choose from.