The Cost of a Data Breach & How to Protect Your Business
As we all know, with new technologies come new threats, both known and unknown, and protecting your business’s IT environments from a data breach is vital to your organization’s financial well-being. A recent IBM report states that the average global cost associated with a data breach reached its highest point on record in 2023, totaling $4.45 million—and that’s just the beginning. Falling victim to a data breach will damage your reputation, impact employee morale, and destroy the trust between you and your customers.
The trends we’re noticing emphasize the need to invest in security measures. It’s been reported that 51% of organizations plan to increase their IT security investments in 2024. Is your organization one of them? In the face of evolving cyber threats, staying ahead is not just a good idea but a necessity.
Types of Cyberattacks that Cause Data Breaches
Phishing & Social Engineering Attacks
Two of the most common types of attacks that can cause a data breach are phishing and social engineering attacks. These types of attacks are orchestrated through deceptive emails, texts, or webpages. They are designed to trick users into giving out confidential personal or corporate information by convincing the victim that they are interacting with a trustworthy person or organization. Have you ever received a text message from your CEO asking you to get them gift cards? Or an email from your IT department directing you to a webpage to reset your password? These are common methods used in phishing and social engineering attacks — so be aware and always triple check before you click any links or give away your credit card information.Malware Attacks
Malicious software, or malware attacks, are another common type of attack that often lead to data breaches. Malware can come in many forms such as viruses, ransomware, or spyware, and it can infect systems and steal or damage data. Ransomware attacks, in particular, encrypt data and demand payment for its release. These types of attacks are often very costly and are orchestrated through a variety of methods including phishing and social engineering. However, attackers also carry out malware attacks by embedding malicious code on websites, exploiting software vulnerabilities, creating malicious ads and even installing malicious code on removable devices such as a USB or external hard drive.The Cost of a Data Breach
As mentioned earlier, the cost of a data breach reached the highest point on record in 2023, with an average cost of $4.45M. The figure on the right shows the top five industries that experienced the highest average data breach costs in 2023:- Healthcare – 10.93M
- Financial – 5.90M
- Pharmaceuticals – 4.82M
- Energy – 4.78M
- Industrial – 4.73M
Smaller organizations saw a greater impact in 2023 than larger organizations. Businesses with a headcount of less than 500 employees saw an average cost increase of 13.4% to $3.31M, and companies with 500–1,000 employees experienced a surge of 21.4% to $3.29M.
Ransomware Incident Costs
In an era where high-profile data breaches like the 2023 MGM breach dominate headlines, it’s easy to overlook the effect that cyberattacks have on smaller businesses. However, as noted above, smaller businesses are at a higher risk. According to a study by NetDiligence®, 98% of cyber claims between 2018 and 2022 were filed by small to mid-market businesses, totaling a loss of $1.6B between legal fees, crisis services, and incident costs.
Since 2018, ransomware has reigned supreme as the number one financial threat for small to mid-market businesses. Over the last four years, the average incident cost has grown steadily, averaging 865K in 2022. Threat actors continue to get more and more greedy, with average ransomware payouts increasing to 555k last year. In fact, the total number of ransom payments in 2023 exceeded $1.1B across businesses of all sizes. Apart from the ransom payments, the average expense associated with a ransomware attack, which encompasses detection and escalation, notification, post-breach response, and lost business, increased to $5.13 million in 2023.
Dwell Time
Dwell time refers to the duration that a cyber threat remains undetected within a network or system before it is identified and mitigated. It is a critical metric because the longer a threat actor lurks undetected, the greater the potential damage they can inflict, including data theft, system compromise, and disruption of operations. Minimizing dwell time is essential for organizations to promptly respond to security incidents, mitigate risks, and prevent extensive harm to their assets and reputation.
In IBM’s 2023 “Cost of a Data Breach Report,” their findings show that organizations that outsourced security monitoring and management services experienced significant improvements in the time it takes to identify and contain breaches. Or in other words, they saw a major reduction in dwell time. On average organizations that outsourced their cybersecurity services detected breaches 16 days faster than the global average of 204 days reported in 2023. Meanwhile, those who relied on their in-house team took 28 days longer than the average. Similarly, organizations that outsourced their cybersecurity services contained breaches 10 days faster than the global average of 73 days. In contrast, companies that didn’t outsource experienced containment times 5 days longer than this average.
Fortifying Your Business with Cybersecurity Services
MDR, XDR, and SIEM with SOC are comprehensive cybersecurity services that work together to protect businesses. Think of them like a high-tech security system for your computer networks, where MDR is the 24/7 monitoring service, XDR is the wide-angled camera that watches over all digital doors and windows, SIEM is like the central alarm system that alerts for any trouble, and the SOC is the team of security guards who respond when something is amiss. Together, they form a coordinated defense against cyber threats to keep business data safe.
Integrated Cybersecurity: MDR, XDR, SIEM, and SOC Explained
Managed Detection and Response (MDR), eXtended Detection and Response (XDR), Security Information and Event Management (SIEM), and Security Operations Centers (SOC) are integral components of a modern cybersecurity strategy. MDR actively monitors networks using advanced technologies like machine learning to quickly spot and address threats, enhancing proactive defense measures and incident response. XDR extends these capabilities across multiple security layers for greater visibility and coordinated response, reducing alert fatigue. SIEM centralizes and analyzes security data for real-time incident detection and compliance management. Together with a SOC’s expert team that oversees these systems and manages threat hunting and incident response, these solutions collectively fortify an organization’s defense against cyber threats and minimize response times.
BraveSoft’s cybersecurity services, including MDR, XDR, SIEM, and SOC, offer a robust defense against evolving cyber threats. With our integrated approach, we provide comprehensive protection for your business data, ensuring peace of mind and proactive threat management.
Start Protecting Your Business
The growing costs and repercussions associated with data breaches underscore the critical need for a robust and proactive cybersecurity strategy. As technological advances introduce new threats, safeguarding your business’s IT environment is essential for financial well-being. New technologies are emerging every day, and cybercriminals are continuing to get smarter, which means there is only one thing for certain: you cannot afford a data breach. Secure your business against evolving cyber threats by filling out the form below.