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Consumers Vote with their Wallets: Hold Breached Organizations Accountable
Monday, June 16, 2014 6:40 AM

Years of complacency among businesses and indifference among consumers regarding data breaches were effectively shattered in 2013. In the same year as one of the largest data breaches in history, the misuse of breached consumer data hit a record high, raising the issue of data breaches into the public consciousness. Javelin Strategy & Research has just released 2014 Data Breach Fraud Impact Report: Consumers Shoot the Messenger and Financial Institutions Take the Bullet, which examines consumers’ attitudes and behaviors towards companies that have exposed their customers to a data breach.

Javelin found that consumers tend to avoid retailers the most, especially small online merchants and alternative payment providers, compared to other industries. The report also contrasts two of the most prolific data breaches in U.S. history- TJX and Target, to uncover important lessons and strategies for stakeholders in responding to data breaches as they try to maintain their reputations and retain the loyalty of consumers.

Retailers are most likely to be targeted by criminals for their card data resulting in a higher fraud rates. Coupled with insufficient detailed notifications about the data breaches, Javelin found that consumers tend to avoid retailers the most, compared to other industries such as banking and credit card issuers.

Javelin Strategy & Research’s 2014 Data Breach Fraud Impact Report: Consumers Shoot the Messenger and Financial Institutions Take the Bullet report is based on an address-based survey of more than 5,000 consumers, including 936 identity fraud victims.