What Retail Marketers Should Know About Data Security

IRVINE, Calif., April 17 /PRNewswire/ -- Massive data leaks in the retail industry have heightened the scrutiny of how retailers manage customer data - or don't. Last month, a major retailer reported the loss of millions of customer records. Losing data for two years before the discovery, it was the biggest card heist ever according to analyst firm, Gartner. Millions of consumers were forced to close credit accounts and check credit reports, causing unimaginable inconvenience.

As retailers and other industries face increasing vulnerability in storing customer data, SmartReply, the country's largest provider of mobile and voice communications for retailers, has exceeded the highest technology requirements to manage and protect customer data.

"In view of customer data security breaches industry-wide, we engaged a global systems security company to attempt hacking into every corner of our operations network and system," said Tim Odell, Executive Director of Technology for SmartReply. "After months of random attacks, our systems passed vigorous tests to the highest possible standards." SmartReply is now the only voice and mobile marketing services provider for retailers to become PCI Certified.

Although infrastructure testing and hired hackers are commonplace in mission-critical operations like homeland security and financial services, they're not immune to hackers or data theft. According to the FTC, data theft totaled $54 billion in 2005.

"Unfortunately, many marketing service providers are not preventing security breaches, although they are handling client's sensitive data," said Eric Holmen, President of SmartReply. "For us, it's a matter of ethical responsibility. We must be sure our clients' customer data is secure. It will become commonplace for CEO's and CIO's to demand stringent testing, but we're clearly market leaders with our higher standards."

Damage caused to companies by data compromise occurs on many levels. A single data breach costs $5 million to $50 million, according to the Ponemon Institute. There is also loss of intangible assets, like trust and erosion of brand value. Stock prices plunge. Researchers at Emory University's Zymand School of Brand Science found 0.63% to 2.1% reduction in stock price whenever a breach is announced. Previously relaxed about data security, marketers are beginning to see this as a career-ending oversight, not an afterthought.

Equally troubling is the amount of voice and mobile technology data in non-secure facilities or overseas, where security requirements might be compromised and ungoverned by US laws. According to Holmen, "Retailers who provide customer data to a third party must cover basics we call the Marketing Data Security Promise." These include:

  1. Keep it close to home. Make sure your data never leaves a
     server outside the US.  Data passing over systems can be compromised,
     without client or provider knowing.

  2. PCI DSS testing by a reputable firm. Payment Card Industry Data
     Security Standard, developed by VISA, MasterCard, Discover, American
     Express and JCB is a guideline/standardized test for organizations
     processing card payments to prevent fraud, hacking and other security
     issues. Card payment processors must be PCI compliant or risk losing
     the ability to process payments. SmartReply meets all PCI standards and
     guidelines.

  3. Penetration testing. Conducted by hired hackers worldwide, they attempt
     to break into your systems at random times, by many means. Intense, but
     thoroughly necessary.

  4. Network facility site visits. This gauges how data is processed. "Our
     network site has armed guards, man-traps, biometric scans and requires
     pre-screening. It's intimidating, even for staff, making it
     impenetrable for devious, would-be hackers," says Odell.

  5. People. A system is only as good as its people. "We look for people
     wanting to maintain the Fort Knox of data centers." A small operation
     with few people is a bad sign - probably doing what they can to
     get by. Data security is likely very low on their to-do list."

  6. Test results confirm that SmartReply has been progressively delivering
     outstanding technology developments and leading the market in customer
     data protection. SmartReply's highly secure technology can help
     retailers establish strong policies for protecting valuable customer
     data right from the start, before it's too late.

For more information, please contact Eric Holmen at 800.785-6769 or visit http://www.smartreply.com/.

  Press Contact
  Vanessa Horwell
  Strategic Vantage for SmartReply
  (786) 206.7883
  vanessahorwell@StrategicVantage.com