Impact of Data Breach in E-commerce

Have you ever stopped and thought of what kind of information you’re giving out to every website you visit? Especially when you’re purchasing from an online e-commerce shop, your sensitive data is getting collected.

For example, you ordered a product from an online shop and had to enter your home or office address. The online shop might have your credit or debit card information, and other sensitive information. To put it short, around 10 accounts per 1,000 that visit ecommerce shops are usually dealing with a data breach.

That’s not a small number, so today, we’re going to dive deeper into this article and learn more about how much impact can data breaches have on your online business.

The types of data breach that occurs in ecommerce


As online shops continue to expand and the ecommerce world continues to grow, online work is becoming more common and connecting people through many communication channels and transactions via the internet and business.

Breach of sensitive information

Recent studies showed that the breach of online information has caused ecommerce companies to lose more than $48 billion in revenue. This means that people who worked for the organization were involved in these attacks and information theft.


In many cases, it’s challenging to think that your own team might be responsible for the breach, but it does happen and sometimes, it might be by accident.

Even if you lose a physical item, if it ends up in the wrong hands, it can be trouble for you and your business.

Password guessing

Human beings think more alike than they imagine. Therefore, if you don’t set the right passwords, you might end up getting your information stolen due to password guessing. 30% of online breaches that occur are due to weak passwords.

However, many online breaches that occur aren’t always stealing credit card information, but other sensitive information. Weak passwords usually include setting your password as your birthday date, name, surname, and many other related information. In short, avoid adding any information that reflects your personal information.


Phishing is referring to different types of attacks that might occur. It accounts for some percentage of online ecommerce breaches that occur. Phishing is quite interesting because if you fall for traps easily, you can have your sensitive information breached much faster than you think.

A great example of phishing would be receiving an email from your manager to click on a link and complete a task. This will not be your manager, but some scammer that is trying to hack into your information. Online attackers are great at trying to impersonate someone and the worst part is that they make it seem like they are not.


You’ve probably heard of this term before because it’s highly common. Malware is responsible for moving and stealing your data. In some cases, it might even wipe your data and insert keyloggers that can record keystrokes you’re typing on your desktop.

Malware is usually injected through files you click on or even websites you visit. It’s pretty scary to encounter this type of attack when you’re running an online store because it can easily show false information to buyers.

Global privacy laws that protect your sensitive information


Two global privacy laws are on your side when it comes to protecting sensitive information. They are the GDPR and the CCPA. Let’s take a deeper look at who they help and what they are most responsible for.


What is GDPR? The General Data Protection Regulation (GDPR) is the European Union’s important data privacy regulation. This privacy regulator came into power in early 2018, which entirely transformed how organizations are managing personal data and collecting it.

The regulation doesn’t allow organizations to collect and use consumer data without their initial approval. If done so, hefty penalties are addressed to organizations. However, keep in mind that the GDPR only accounts for EU citizens and all organizations that do business within EU boundaries.

This means that if you live in Asia, or some other continent and have nothing to do with the EU, the GDPR is not going to account for you.

The GDPR, in general, accounts for the following types of personal data:

  • Biometric data
  • ID information
  • Website data (IP addresses, cookies, etc.)
  • Ethnicity/race
  • Sexual orientation
  • Generic and health data

In short, all information that has to do with a user’s identity is covered under the GDPR.


On the other hand, we have the CCPA, which stands for the Californian Consumer Privacy Act. Amendments have been made to the CCPA and came into effect only recently, from January 1st, 2023.

The CCPA generally protects information that is relating to households and individuals, excluding any publicly available information that is recorded by the federal, state, or local government.

Moreover, keep in mind that the CCPA only accounts for Californian citizens and for those who do business within Californian boundaries. For example, if you own a business in Europe, but it deals with a Californian entity, you will be held accountable if you violate any laws under the CCPA.

Overall, the CCPA grants users the right to do the following:

  • Right to delete personal information
  • Right to access personal information
  • Right to opt out of the sales of personal information
  • Right to avoid discrimination for exercising CCPA rights


The user has the right to do anything they wish with their information and this is done due to the reason that many incidents have occurred in the past because of organizations collecting data without authorization.

The major costs you can run into because of data breaches

When a breach occurs, you need to know that there are many things at cost. Here are some of the main problems you might encounter:

Financial costs

A data breach can instantly hurt your financial budget. When online attackers take over your information, they will steal whatever they can. However, you can reduce damages by trying to address incidents faster, but remember that you need to consider all of the following costs:

  • Compensating costs
  • All expenses that are related to litigation
  • Costs of patching vulnerability

Most financial costs are higher when you are unprepared for an attack. In fact, studies show that only 15% of organizations are actually prepared for an online attack.

Customer trust

If you were a customer and got your data stolen, how would you feel after an online attack? You most likely won’t feel comfortable shopping from the same shop again. Customer trust is highly important and if you lost it, you most likely won’t ever get it back.

Nowadays, when you purchase products from an ecommerce business or a marketplace, you’ll feel more comfortable doing so from a business you trust. In case a data breach does occur, you need to ensure that you report it directly to the parties that can quickly communicate the issue and address it.

Even if a breach does occur, if you can quickly handle them, it’ll help you keep your customer’s trust.

Brand reputation

Short said, brand reputation is important and if you lose it once, you will encounter multiple issues with your customers because they’ll doubt if they can trust you or not. Losing one’s trust only makes things worse for you and your business, potentially, even driving away customers that could have come to you.

Therefore, brand reputation is important and the reason why organizations will spend countless amounts of money and hours working on it. You can take yourself as the most simple example. Will you buy from someone you trust, or from a new brand that just entered the market?

You can’t ever buy or sell trust, it’s earned throughout time and fraud can easily make it disappear in short periods of time. Worst of all, it only takes one large online attack to make things go the wrong way. Therefore, wish for the best and always be prepared for the worst.


There’s always a way to prevent online attacks

It only takes one time for you to lose your brand reputation and sensitive information on your ecommerce site. Therefore, always be prepared for any sort of attack and keep your eyes wide open. Even tell your customers to stay alert if they see anything suspicious.

The more eyes you have, the better it’ll be for you and your time. After all, consumers want to feel secure and this can only be done when you are always prepared before anything happens.


The Author:

Tony Ademi is a freelance SEO content and copywriter. He has been in the writing industry for three years and has managed to write hundreds of SEO-optimized articles. Moreover, he has written articles that have ranked #1 on Google. Tony’s primary concern when writing an article is to do extensive research and ensure that the reader is engaged until the end.