Nowadays businesses depend on the Internet more than ever. Businesses promote our services via the Internet. Companies hunt high-profile employees on the Internet. Marketers gain leads, sales, consumer loyalty and affiliates via the Internet. Small and medium businesses cross the borders and deal with foreign partners and consumers via the Internet. Businesses depend on the Internet. More so, businesses depend on the level of consumer trust to the Internet as such, and online shopping or the very image of a business in particular, especially when it comes to credibility in terms of privacy and cybersecurity.

Consumers need to trust an e-commerce website in order to make the purchase. You may deliver excellence in what you sell, but do you instill trust in how you deal with your online transactions, and how you handle consumer private data?

Many reports and surveys have warned about this, but when the reports and surveys come from interested parties, such as security and antivirus solution providers, their findings often seem too gloomy to be credible. Of course, a cybersecurity company will deliver reports that urge businesses to invest into some cybersecurity solutions more than they intended, and work harder on their cybersecurity in general. Cybersecurity companies need to sell their goods, too.

However, one particular report that proves the online consumer activity has been declining drastically over the past few years comes from an entity that is not selling any cybersecurity products.

The U.S. NTIA Reports Decline in Online Shopping Activity

The U.S. Department of Commerce’s National Telecommunications and Information Administration conducted a study and discovered that nearly half of online households in America have significantly limited their online transactions due to privacy and security concerns.

In fact, the report itself says “Lack of Trust in Internet Privacy and Security May Deter Economic and Other Online Activities,” while its results clearly prove the eroding trust in Internet privacy and security does deter online shopping and other online activities.

People are increasingly cautious about entrusting their personal data, medical records via the Internet, or making online purchases. At the time when cybersecurity incidents, data breaches, hacks and identity theft stories have become the new norm, consumers are changing their online behavior.
The changes aren’t in favor of online commerce, or businesses in general, according to the data collected by the U.S. Census Bureau in July 2015 and analyzed by the NTIA.

If you think bad publicity after Snowden’s publications is to blame for the change of attitude, you are wrong. Negative personal experience is the number one cause for limiting consumer activity online for the majority of the respondents. 19% of online households, that is the households using the Internet from home, reported a data breach, identity theft or other cybersecurity incident happen to them in the past 12 months. That 19% stands for nearly 19 million American households. Notably, the more connected are the households, the more they report data breaches or any other cybersecurity incident. By connected we understand the number of Internet-connected devices in the household as well as the usage of mobile data plans when outside their homes.

NTIA asked their respondents to identify their concerns about cybersecurity and privacy online without suggesting any possible answers. The respondents, thus, were free to give multiple answers without limitations of the multiple-choice tests. Without any prompt from the interviewers, 84% of respondents named one, and 40% named at least two concerns.

63% named identity theft as their primary concern that deters their online shopping activity. Other common concerns included banking fraud, credit card fraud, online tracking and profiling, fear of loss of controls over one’s private data, extensive state, and corporate tracking, fear for personal safety.

The households that reported a security breach were even more prone to limit their online activities. 70% of such respondents quoted identify theft as the number one reason that concerned them the most, with data collection, state and corporate tracking.

Economic and Civic Activities Affected the Most

Online shopping is not the only area, in which many Americans have been restricting themselves. Privacy and security fears have prevented 45% of respondents from making a financial transaction online, shopping online, but also engaging in social networks. Users are increasingly self-censoring their speech online, and more often choose to not make posts to their social network accounts about controversial topics like politics, human rights, medical controversies, inequality, race, religion, terrorism and more.

45% translate to millions of households, which shows the scale of the chilling trend – online discourse on many important topics has stalled because people apply strict self-censorship. In no way can this be beneficial for commerce, or civil society. 29% of households that reported concern over state surveillance said they refrained from expressing their opinions online.

Among the respondents that reported any cybersecurity related incident, 35% said they refrained from online shopping. The erosion of trust to the Internet as such and online commerce is drastic and continues to increase as major retailers, banks, and online services get breach-affected. Ashley Madison, Target, Neiman Marcus, GP Morgan Chase, Sony, a good dozen of healthcare institutions and universities getting hacked does not help instill consumer trust.


NTIA admits the results of the census barely scratches the surface of the issue, and the administration calls the policymakers to action. While policymakers tend to their policy-making business, businesses large and small need to take the troubling numbers into account. The growing consumer mistrust in the privacy and security of online transactions and Internet shopping has and will continue to have devastating effects on commerce. So, what can you do to mitigate the damage and set the basis for a different trend?

Even NTIA recommends deploying strong encryption to protect communication channels, consumer data privacy and integrity, and corporate data. End-to-end, military grade encryption and encryption providers with zero-knowledge policy currently represent the stronger end of the spectrum of solution providers. Encrypting company communications, as well as consumer-company interaction, is vital.

But deploying encryption is not enough. Your consumers need to be aware of your strong stance on cybersecurity and dedication to protecting their personal data in this time of cyber warfare.

As much as PR, your company needs to make sure your It department is aptly staffed and trained in cybersecurity, not just IT administration. Cybersecurity is a much broader concept, and professionals are increasingly lacking. Worldwide headhunters report nearly one million shortage of cybersecurity professionals, so chances are you might have to sponsor some bright students to complete their degrees in cybersecurity if you want to have the professional personnel.

In the meantime, invest in encryption and train your staff to adhere to strict cybersecurity guidelines.


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