The “Cost” of Social Media Incidents

As social media is being kicked into high gear across B2B companies, there has always been talk about “the cost of not doing it right.”  Well, I came across this article on MediaPost by Eric Sass that highlighted a study by Symantec that attempted to calculate the cost of social media incidents…incidents such as security breaches or negative publicity and the like.  It’s not clear how the numbers are calculated, but it’s interesting anyway.  Here’s what they found:

The typical enterprise experienced nine social media incidents, such as employees posting confidential information publicly over the past year, with 94 percent suffering negative consequences including damage to their reputations, loss of customer trust, data loss and lost revenue.

94% said there were serious ramifications?  Wow that’s a pretty high number. Then next question is, what type of incidences?

The single most common type of social media incident was employees over-sharing on public forums, with 46% of survey respondents citing at least one example in the last year. This was followed closely by loss or exposure of confidential information, at 41%, and exposure to litigation at 37%.

It gets even better because Symantec quantified the costs as a result of dealing with these incidences:

  • The average loss in stock price came to $1,038,40
  • Average litigation costs were $650,361
  • Direct financial costs were $641,993, and
  • Lost revenue was $619,360.
  • Costs of damage to brand reputation and loss of customer trust came to $638,496

I don’t know about you, but to me all this will breed is more paranoia among those companies who are on the fence about engaging in social media tactics.  Especially when it comes to loss or exposure of confidential information.   I know that there are always employees who do stupid things.  Heck I was looking at my listening feeds for a client today and uncovered an employee who said something stupid on their Facebook profile.   I wanted to post on that person’s page – who clearly did not set their permissions correctly otherwise I wouldn’t have been able to read the post – “Stupid is as Stupid Does!”  But would I classify that an “incident”? I think not.  It’s more ignorance though.

Personally we have been working with several B2B companies on their social media strategies and implementation and have not come across these problems.  I have read more about them on the consumer side. But, with good education practices and policies in place, I think that some of this can be avoided.  That and some common sense.

Clearly, this survey positioned Symantec to capitalize on some of the data uncovered.  But, motivation by fear can only go so far.  Thoughts?

 

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