Why do hackers target small businesses? It’s a question that many entrepreneurs and IT professionals ponder as they navigate the digital landscape.
So, what makes them such easy prey? Well, many small businesses operate with a shoestring budget and limited IT expertise.
Data from a report by Barracuda Networks, which Edward Segal reviewed in Forbes, reveals that, on average, an employee of a small business with fewer than 100 employees will experience 350% more social engineering attacks than an employee of a larger enterprise.
This vulnerability stems from several factors, including limited resources and less sophisticated security systems in smaller businesses.
These businesses often lack the security expertise to fend off sophisticated attacks, making them attractive targets for hackers looking to exploit weaker defences.
CEOs and CFOs in small businesses are particularly vulnerable, as their accounts are almost twice as likely to be taken over as average employees.
This trend highlights the urgent need for small businesses to prioritise cybersecurity to protect themselves against these increasing and common cybersecurity threats.
With Edward Segel’s report in mind, this article will explain why hackers have been more focused on attacking small and medium-sized businesses lately.
Limited Security Measures
Limited security measures in small businesses (SMBs) make them susceptible to cyberattacks.
A survey by Digital.com to 1,250 owners of businesses with 500 employees or less reveals that as of March 2022, 51% of small businesses still need cybersecurity measures in place.
Additionally, 59% of small business owners without cybersecurity believe their business needs to be more significant to be targeted, showcasing a misconception about their risks.
Despite this, 87% of SMBs collect customer information, including sensitive data, risking customer privacy.
The lack of cybersecurity in SMBs and customer data collection creates a vulnerable environment attractive to hackers seeking easier targets with potentially valuable information.
Investing in cybersecurity is becoming indispensable for small businesses in 2024 as it shifts from a precaution to a critical component of business strategy.
Small businesses must take a proactive approach, focusing on regular security assessments, developing a dynamic cybersecurity strategy, and investing in critical security areas to defend against these evolving threats.
Data Value
In reality, small businesses often possess a wealth of sensitive information attractive to hackers.
This includes customer data such as credit card information, social security numbers, bank account details, phone numbers, and addresses.
According to Digital.com, 87% of small businesses collect customer information, including names, addresses, phone numbers, and more sensitive data like credit card information, bank account details, and social security numbers.
Furthermore, small businesses are facing an increasingly sophisticated threat environment.
Small businesses must adopt effective cybersecurity practices with such valuable data at risk and in a complex threat environment.
Here are some cyber security tips for small businesses to help protect the data they have:
- Conducting thorough security assessments to identify vulnerabilities
- Developing a comprehensive cybersecurity strategy that covers all facets of cybersecurity
- Investing in the right technologies, skilled personnel, and continuous training to stay ahead of threats.
Additionally, small businesses should be aware of future AI advancements and the risks they may bring as these technologies continue to integrate into everyday activities and workflows.
This evolution necessitates a careful balance between innovation and user welfare, especially for small businesses venturing into new digital territories.
Lack of Awareness
The lack of cybersecurity awareness among small business owners is a critical vulnerability that hackers exploit.
According to the report from Barracuda Networks, which Edward Segal reviewed in Forbes, small businesses are three times more likely to be targeted by cybercriminals compared to larger companies.
This vulnerability is partly due to a need for more awareness and understanding of cybersecurity threats.
Yes, small businesses often need more resources and expertise to implement robust cybersecurity measures.
Furthermore, the report indicates that an employee of a small business is 350% more likely to experience social engineering attacks than those in larger enterprises.
This highlights the need for small businesses to educate themselves and their employees about cybersecurity risks and to implement adequate security measures to protect against these threats.
Supply Chain Vulnerabilities
SMBs are often integral parts of larger supply chains, and their security weaknesses can be exploited by hackers as a gateway to more giant corporations.
The Accenture State of Cybersecurity Resilience 2023 report reveals that cyber transformers, who are more proactive in their cybersecurity approaches, often include their supply chain partners in their incident response plans (45% vs. 37%) and require them to meet strict cybersecurity standards (41% vs. 29%).
This highlights the importance of supply chain security and the need for small businesses to adopt stringent cybersecurity measures.
Hackers can access the more extensive supply chain network by breaching a small business, potentially causing widespread damage.
This highlights the need for SMBs to strengthen their cybersecurity practices and for larger corporations to ensure their supply chain partners adhere to robust security standards.
Financial Gain
Financial gain is a primary motive for hackers targeting small businesses. These entities are often seen as easy targets for ransomware attacks due to their lack of robust cybersecurity measures.
Hackers exploit this vulnerability by encrypting the business’s critical data and demanding payment for its release.
Small businesses facing the potential disruption of their operations may be more likely to pay the ransom to quickly restore access to their data.
This makes them attractive targets for cybercriminals looking to make quick financial gains.
The trend of targeting small businesses for ransomware underscores the importance of implementing effective cybersecurity strategies to protect against such threats.
Inadequate Training
Inadequate training in small businesses (SMBs) significantly contributes to cybersecurity vulnerabilities.
The IBM Security Cost of a Data Breach Report 2023 shows that organisations with low employee training have higher average costs for data breaches.
Specifically, organisations with low levels of employee training have an average breach cost of USD 5.18 million compared to USD 3.68 million for those with high levels of training, indicating a difference of 22.8%.
This data underscores the importance of cybersecurity training for employees in SMBs.
Employees’ lack of awareness and understanding about cybersecurity can lead to unintentional security breaches, such as phishing attacks or mishandling sensitive information.
Practical employee training can significantly reduce the risk of breaches and mitigate the potential financial impact on businesses.
Therefore, investing in comprehensive cybersecurity training for staff is crucial for SMBs to enhance their security posture.
Limited IT Support
Small businesses often need more IT support, which can significantly impact their cybersecurity posture.
These businesses can maintain, monitor, and update their cybersecurity infrastructure with dedicated IT teams.
This limitation can lead to delayed detection and response to cyber threats, leaving small businesses vulnerable to attacks.
Hackers are aware of these shortcomings and often target small businesses, knowing that their defences will likely be weaker and response times slower than larger organisations with dedicated IT support.
The lack of immediate and effective response to cyber incidents increases the risk of data breaches and financial loss. It affects the business’s ability to recover promptly from such attacks.
For small businesses, investing in IT support, whether in-house or outsourced, is crucial for enhancing their cybersecurity and reducing their vulnerability to cyber threats.
Use of Outdated Technology
Small businesses often use outdated technology and software due to budget constraints or a need for more awareness about the importance of regular updates.
This reliance on older systems can expose them to significant cybersecurity risks.
Hackers frequently exploit known vulnerabilities in outdated software, as these flaws are often well-documented, and patches may not be available or applied.
This makes small businesses easy targets for cybercriminals looking to breach systems with minimal effort.
Outdated technology increases the risk of successful cyberattacks. It hampers a business’s ability to effectively detect and respond to such threats.
In order to mitigate these risks, small businesses must prioritise updating and maintaining their technology infrastructure to ensure they are protected from the latest cyber threats.
Industry Targeting
Hackers often target specific industries more prevalent among small businesses for data breaches, exploiting industry-specific vulnerabilities for financial gain or other motives.
According to IBM threat intelligence cited in the IBM Security Cost of a Data Breach Report 2023, manufacturing is the most commonly targeted industry by cybercriminals.
The report also highlights several other industries that frequently experience high costs due to data breaches, including healthcare (average cost of USD 10.93 million), financial (USD 5.90 million), pharmaceuticals (USD 4.82 million), and energy (USD 4.78 million).
These industries, often integral to the operations of small businesses, face significant threats from cybercriminals who exploit outdated systems, lack cybersecurity awareness, and have other vulnerabilities.
As a result, small businesses within these sectors need to prioritise cybersecurity measures to protect themselves and their clients from potential breaches and the accompanying financial and reputational damages.
Conclusion
In conclusion, small businesses face many cybersecurity challenges, making them prime targets for hackers.
These vulnerabilities expose small businesses to significant cyber threats, from limited security measures and outdated technology to inadequate training and limited IT support.
Industries like healthcare, financial services, pharmaceuticals, and energy are particularly susceptible to breaches, often due to their inherent value and data sensitivity.
Therefore, small businesses must prioritise cybersecurity. This involves regular security assessments, developing comprehensive cybersecurity strategies, and staying abreast of technological advancements.
But cybersecurity best practices are a long way off. That’s why, at Nexalab, we understand the cybersecurity challenges facing small businesses in Australia, such as targeted cyberattacks due to limited security measures and outdated technology.
We specialise in providing customised cybersecurity solutions to protect your business from these threats.
Our services include web and application development, data visualisation, integration, and security hardening. Yes, we are committed to helping your business thrive digitally.
By partnering with us, you can identify why hackers target small businesses, improve your cybersecurity posture and ensure the safety of your digital assets.
