How can retailers and hospitality vendors win back customer trust?

09 September 2014

Mistakes are costly for most businesses, but for retailers and hospitality vendors the consequences can be devastating. While the actual financial ramifications might not make or break the immediate trading figures, the breakdown in trust caused by an error can have a long-lasting impact on customer loyalty.

To see an example of this, look no further than Target and Home Depot, both of whom have suffered massive data breaches during the past 12 months. Around 56 million sets of credit and debit card details were seized by Home Depot hackers – making it the second largest incident of its kind in US history – while Target’s profits dropped 46% after its systems were breached in December 2013.

The fact that such internationally renowned and well respected organisations have suffered catastrophic security failures has understandably struck fear into shoppers. Both retailers have subsequently invested more than $1million apiece in technology and initiatives to safeguard themselves against future attacks, but many consumers view this as shutting the stable door after the horse has bolted.

In time, with the right marketing strategy, Home Depot and Target will likely recover from the breach, but the process of rebuilding customer trust cannot be rushed. And for the retail and hospitality sector as a whole, public awareness of data security has been piqued by these incidents. Therefore it is not just the brands involved that need to invest in a secure network to allay consumer concerns.

Upgrading payment processing technology to the latest levels of PCI compliance is not something that retailers and hospitality vendors can afford to put off in this climate; they must swiftly find a solution that can be implemented without interrupting day-to-day operations, which offers leading edge levels of data encryption security.

After all, the investment needed to implement new technology and proactively market its capabilities amounts to far less than a recovery campaign in the event of a customer data breach.

How can retailers and hospitality vendors win back customer trust?

Mistakes are costly for most businesses, but for retailers and hospitality vendors the consequences can be devastating. While the actual financial ramifications might not make or break the immediate trading figures, the breakdown in trust caused by an error can have a long-lasting impact on customer loyalty.

To see an example of this, look no further than Target and Home Depot, both of whom have suffered massive data breaches during the past 12 months. Around 56 million sets of credit and debit card details were seized by Home Depot hackers – making it the second largest incident of its kind in US history – while Target’s profits dropped 46% after its systems were breached in December 2013.

The fact that such internationally renowned and well respected organisations have suffered catastrophic security failures has understandably struck fear into shoppers. Both retailers have subsequently invested more than $1million apiece in technology and initiatives to safeguard themselves against future attacks, but many consumers view this as shutting the stable door after the horse has bolted.

In time, with the right marketing strategy, Home Depot and Target will likely recover from the breach, but the process of rebuilding customer trust cannot be rushed. And for the retail and hospitality sector as a whole, public awareness of data security has been piqued by these incidents. Therefore it is not just the brands involved that need to invest in a secure network to allay consumer concerns.

Upgrading payment processing technology to the latest levels of PCI compliance is not something that retailers and hospitality vendors can afford to put off in this climate; they must swiftly find a solution that can be implemented without interrupting day-to-day operations, which offers leading edge levels of data encryption security.

After all, the investment needed to implement new technology and proactively market its capabilities amounts to far less than a recovery campaign in the event of a customer data breach.