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Performance Marketing October 29, 2015

Customer Loyalty: Fixing the damage of data breaches


“I’m very sorry for all the frustration, worry and concern this will inevitably be causing all of our customers,” explained TalkTalk CEO, Dido Harding in the wake of its latest cyber-hack.

Whilst I’m sure there is a genuine sentiment in her statement, it’s difficult not to anticipate the inevitable damage this will be doing to the brand’s customer loyalty. After all, having your customers’ personal data hacked once can perhaps be forgiven, but twice and then thrice in the space of a year begs the question, ‘who is really to blame here’? The hackers? Or the people who had been entrusted with their paying customer’s details in good faith?

Set the standard

It is common knowledge that in order to rise above the competition, businesses must focus on customer experience; creating a brand that customers can trust has never been more poignant in setting them apart.

The consumer market has moved heavily to digital, and enterprises must accept the responsibility to set a standard. Though it’s clearly a failure that TalkTalk did not have adequate security measures and encryption to prevent the SQL injection-styled hack, they certainly aren’t the first big name to have dropped the ball in cyber security.

Back in 2013, a Silicon Valley tech-giant was attacked, leaving 38 million credentials vulnerable. However, its successful approach to crisis management benefited the brand in the long term. On discovering the breach, it took full responsibility by announcing it publically, and contacting customers to assure them that their data been encrypted on their servers; perhaps a key move in ensuring its reputation stayed intact.

Customer experience is more than just having 24/7 access or a smooth running website. If customers are now put in a position where they have to trust companies with their data, proving to them that they can trust in your technology, just as they should feel safe engaging with your representatives in person, is paramount.

To retain is better than to acquire

It’s unlikely this will be the demise of TalkTalk, however the dent on customer retention will certainly cost them financially.

An Econsultancy study found that across multiple industries, the cost of keeping a customer is about 5 times less than the cost of acquiring a new one, so it makes sense economically to nurture your customer relationships for a lower maintenance cost.

Customers have easy access to finding the best deals online, and are always on the lookout for a better offer. Therefore, if customer experience and loyalty is really something your company claims to be at its core, then it needs to run throughout the DNA of the organisation; from the CEO right the way through to the website developers and frontline teams.

When the damage is done…

Following the banking crisis, the finance sector suffered the harsh reality of dramatically losing customer loyalty. Customers continue to mistrust the banking sector and, as a repercussion, are cautious with other sectors. With this deservedly cynical attitude towards corporations, customer trust is something both precious to gain and delicate to handle. Or is it?

Any astute marketer or PR professional will tell you that with a strong crisis management strategy and overall customer retention plan in place, all is not lost if your company finds itself in hot water.

It seems glaringly obvious, but at the centre of customer loyalty is a person. What businesses mustn’t neglect to remember is that even through digital communications, we all still appreciate the human element of interaction.

Using Digital to build/rebuild trust

  1. Social Media – Most customers utilise social media platforms to either directly engage with a company or carry out a vetting process. This is a quick and personable way for you to keep the conversation going with your customers, to show them that you are right there for them, doing all you can and better still, telling them about it first.
  2. Online Customer Service – There’s nothing more annoying than being put on hold. An online service or FAQ section allows for customers to feel supported by your brand, without any hassle or extra call costs.However, this comes with a caveat; nothing is more frustrating than either having to repeat information that you’ve already entered online, or being a long-standing customer and still having to tell your provider everything about yourself. Developing a single view of the customer, across all of their interactions with your organisation, will pay dividends for your customer experience, as well as your operational efficiency.
  3. Reviews and Ratings – Encouraging your customers to review your service/product sends the message that your company cares about what they think and you’re ready to listen.Uber is a great example of using a two way rating. Drivers can rate customers, just as they are rated themselves. Making it a two way conversation results in more valuable data, which can be used to improve the service.
  4. Multiple Payment Options – Not surprisingly, customers are nervous about sharing their bank details. A study showed that 73 percent of online consumers want several payment options when making purchases. A pretty straight forward and important way to show you value their trust and have good intentions with their data.
  5. Mobile – Using mobile to enhance your customer experience can be a great way to build a trusting relationship, whether it is being able to track a service through GPS or a text message to send helpful information.

Not everything can be repaired through quick, clear and concise communication after customer trust and loyalty is damaged through a cyber-attack, but there are measures that can help organisations start to rebuild that trust.

Surely prevention is better than cure, so ensuring your digital infrastructure is secure and robust should be top of the agenda for all those who care about protecting their customers’ data and, therefore, loyalty.

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