What is more valuable: all of Coke’s factories around the world or the brand itself? If you chose the latter, you’d be correct. Brand image is the most important aspect of any business and with the latest round of internationally relevant data regulations and laws, brands must tread lightly or risk damaging it.
Laws such as the Notifiable Data Breaches scheme passed last year are perhaps the most relevant in terms of impact on brand reputation. This is because the law compels the disclosure of any data breach affecting large Australian businesses.
Essentially, it is a legal requirement to report any data breaches your organisation experiences, which makes visible any data mishaps. In its first year of operation, the scheme forced the disclosure of around 950 data breaches, meaning the affected organisations were legally obliged to notify those whose personal information had been compromised.
This places a negative sentiment on brand image and tarnishes the chain of trust between customer/client and organisation. Events like this also push Australian businesses—which have not been proactive in protecting their client’s personal data—to audit their systems to ensure third party data is secure.
Following this and other laws such as the Assistance & Access Bill, Australia’s data regulation space will continue to mature rapidly in 2019 as more proposals for data privacy and sovereignty laws are put forward. There’s no doubt that regulation of data privacy in particular will be a major focal point for government and organisations this year.
Not only should data management and protection be a major point of focus for Australian businesses, but regulatory compliance and data privacy must be too. While it is right that data is a hugely valuable asset, it is now time to recognise it also as a significant liability too.
With World Backup Day just passing, now is a good time to reflect on the priorities and imperatives that organisation’s need to have in place in the age of data regulation. These will be vital in protecting not only the data of their clients, but their reputations too.
The Privacy Priority
Companies who fail to prioritise data privacy and protection for their business assets—including customer data—will risk falling into a financial pit, with severe damage to not just bottom line profits, but brand reputation too.
There is an expectation on businesses to take responsibility for protecting the data of their customers, and if this expectation is not met, the brand will inevitably lose credibility. Public perception, coupled with tighter regulations, are two variables businesses need to pay particular attention to.
Even the most iconic of brands can misstep in the data regulation age. For example, Google’s recent breach of the EU’s General Data Protection Regulation (GDPR) may have set it back $80 million, but what’s worse is the negative impact on public sentiment towards the brand. These instances will become more common here in Australia as regulations around data tighten, akin to that of Europe’s GDPR.
Businesses are right to be concerned with the financial repercussions of such a breach of regulation, but what they should be more concerned about is the loss of trust in the brand. Brand trust will continue to be a key differentiator as consumers become more aware of how their data is being used and it’s crucial for business leaders sat in every seat around the corporate boardroom table to get involved with this.
The Data Management Imperative
While the fear of potentially breaching these new regulations sets in, it’s important not to forget the other threat vector that will always pose a risk to Australian businesses: data breaches.
It’s critical that businesses are set up with the proper systems in place to mitigate the risks associated with data breaches like theft and permanent loss of data. Perimeter security will always be a standard method of defence, but without a backup and recovery system in place, businesses cannot fully ensure theirs and their clients’ data is safe.
Strong data management is integral to the operation of any business, especially with the proliferation of digital platforms and technologies that utilise personal customer data to provide personalised experiences.
Ultimately, it comes down to how well a business can manage the security and privacy of their customer’s data, and without a backup plan, they risk losing both their customer’s data as well as a piece of their reputation.
The Nexus Between Data Privacy & Security
The age of global data regulation is upon us and businesses have found themselves at the nexus between data privacy & security as they navigate their way through Australia’s evolving regulatory landscape.
Data privacy, whether driven by GDPR or other regulations, should be the cornerstone of a business’s data management strategy. Businesses that factor in regulatory compliance into their data management strategy and ensure they have an effective backup and recovery system in place will avoid both financial and reputational ramifications. They will also find themselves in almost a data nirvana where they can more effectively and quickly use the data assets they own to gain a key competitive advantage over their rivals.
In 2019 and beyond, it is the responsibility of all businesses to play the role of the data custodian. A brand that can be trusted with the data of its clients will always be able to maintain a good reputation. I believe that you could say with confidence, that, good data management is in fact, the key to maintaining brand reputation in the digital age.