Cybersecurity Must Be a Forethought for Retailers on the Road to Digital Transformation

15
March, 2023
Author: ConnX Marketing

Original post on TechZone 360

Digital transformation has helped revolutionize industries through the introduction of innovative technology, but it certainly had its most profound impact on the retail sector. Digitalization sparked the rise of e-commerce, with the market currently valued at $3.3 trillion and predicted to reach $5.4 trillion by 2026. Furthermore, the vast array of devices and applications has allowed retailers to create new, immersive, and personalized customer experiences (CX), both for in-store and online shopping.

Unfortunately, the growth of the technologically enhanced retail experience has also made the retail industry more of a target for would-be cyber attackers. The wealth of payment information retailers have access to, as well as the many credit card or bank details kept in their digital files, makes the retail sector the perfect target for cyber threats. In total, nearly a quarter, 24 percent exactly, of all cyberattacks are levied against the retail industry.

On top of simply being the most targeted industry, retailers have to deal with a variety of attacks. Credential phishing, malware, ransomware, and DDoS attacks were among the most common cyber threats the retail industry faced, most of which are also increasing in volume and severity. For example, when it comes to ransomware, retailers saw a 67 percent increase in attacks in 2022 from 2021, a whopping 233 percent increase since 2020.

This rapid resurgence of cybercrime amidst digital transformation has created a new emphasis among retail organizations to enhance their cybersecurity portfolios. Retailers are quickly recognizing that they are a massive target of cybercrime, yet only 52 percent of companies feel their security infrastructure is updated, and 61 percent of companies feel they are compliant with security standards. This has left retail enterprises scrambling to bolster their defenses, which is extremely complex given the variety of avenues within the retail sector that an attacker may use as an entrance.

“Retailers must make sure they are leveraging secure networks in order to support new Wi-Fi applications for in-store CX, as well as for standard surveillance technology, such as in-store cameras,” said Jeff Li, Senior Director of Risk, Governance, Projects, and Partners, ConnX, a global Managed Service Provider expert in retail networking and cloud technologies. “Offering free Wi-Fi access to customers is table stakes, as the innovation that comes with using that Wi-Fi for digital marketing, like connecting social media with the in-store experience, is critical for retailers to remain competitive. That said, it is essential that, when retailers adopt these new CX-enhancing WiFi applications, they ensure the network is not only agile but secure as well. Zero-trust solutions, as well as modern private networks, can play a major role in helping retail organizations enable fine-grained visibility and control over incoming and outgoing traffic.”

The Internet of Things (IoT) and its associated devices are also becoming increasingly popular among retail enterprises. The technology is driving the purchase decisions of customers through actionable insights, helping deliver an exceptional shopper experience on the store floor, but most notably, improving supply chain output with connected edge devices. IoT technology is able to simplify inventory management through the use of sensors that help workers know where products are at all times and in real time, when necessary.

Nonetheless, IoT technology has its vulnerabilities, most prominently from software security challenges that require the ability to ensure security by integrity, authentication, end-to-end security, and confidentiality. Simple measures, such as advanced security on gateways and firewalls, can help shore up some of these vulnerabilities, with, once again, a strong network security offering being able to improve the rest of IoT-related cybersecurity.

“Apart from having to secure the network and technologies being leveraged by retail organizations within actual brick-and-mortar stores, retailers nowadays also have to prioritize the defense of their online presence just as much, if not more,” Li said.

It’s estimated that 22 percent of global retail sales will be thanks to online shopping, meaning retail enterprises must ensure they’re not only offering a unique and personalized online CX but a safe and secure one as well.

“With a large quantity of consumers purchasing products online, retailers nowadays are implementing a variety of buy-it online applications to their virtual stores,” Li said. “One such application is to give customers the option of storing their sensitive information with the e-commerce site, which saves time for repeat customers. However, this also poses a significant risk, as then these retail organizations are tasked with defending their customers’ data from cyber breaches.”

Echoing the need for data defenses is the increased use of mobile devices for point of sale (POS) systems. These systems gather info for hundreds of transactions every single day, creating a veritable gold mine for attackers. The reason why POS systems have a major threat is that of unencrypted data. These systems are additionally exposed to malware on account of the actual nature of what they are utilized for.

“In both scenarios, defending customer data against would-be cyber attackers goes much further than simply the financial consequences of a data breach,” Li said. “Failure to adequately secure customer data could also result in a severe loss of trust from consumers, which is critical in a world where consumers are increasingly making informed decisions before choosing which brand to purchase from.”

While defending against growing cyber threats that are accelerating and becoming more sophisticated each day, “managing their digital infrastructure is increasingly complex for retail organizations, and yet it must be at the top of their priority list. The use of E-commerce and digital CX tools is only going to continue to grow as the world continues to push further into a new age dominated by technology, meaning retailers must bolster their cyber defenses before the technology advances once again,” Li said.

Luckily for retailers, there are already a variety of tools and solutions available for retailers to leverage in order to improve their cybersecurity, most notably Security as a Service (SECaaS) solutions. These solutions can help retailers simplify and accelerate regulatory compliance efforts, as well as provide high availability and business continuity during a potential attack, allowing them to survive the perilous digital age where cyber threats could be lurking behind every link.

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