Educating retail in security

The nature of internet-based threats has changed. Attackers have more sophisticated weapons at their disposal, and the attacks themselves have evolved. Hackers armed with Trojans, spyware programs, sniffers and other tools of internet destruction seek out vulnerabilities, wreaking havoc not just for the thrill of destruction, but for the purpose of financial gain. Nowhere is this more evident than in the retail sector.

Wireless technology has come of age, but to take advantage of its benefits, security must be strong. Security risks in the retail environment are substantial. Security vulnerability can cause loss to the bottom line because of the downtime that occurs as a result of a breach, and the loss of customers resulting from negative publicity.

The Federal Trade Commission has brought several cases against large retailers, challenging their faulty data security practices as the cause of high-profile security breaches. Also, the need for the retail sector to compete on a global scale causes price pressures, as does the transparency afforded to consumers by the internet. These competitive pressures force retailers to drive down prices.

With price differentials decreasing and prices moving towards the lower-end of the scale, retailers must do two things: first, they must differentiate their business through means other than price. This means reassuring customers that their personal information and transaction data is secure.

Second, they must turn to internet-based automation methods to become more efficient.

Besides the fact that most bricks-and-mortar retailers also have an online presence, networking across the physical stores and with headquarters demands new technology and the associated security. Most retailers are moving away from private-line frame relay networks to IP-based VPNs over low-cost broadband connections to connect stores, because of the enormous cost advantages.

Gallerix, based in Sweden, securely connects all 120 of its retail outlets with its headquarters. The Body Shop Canada uses a secured broadband connection at each store for sending business-critical data such as credit/debit card transactions and payroll.

What these retailers offer the channel is a huge opportunity to sell security products. This opportunity increases with the rising number of security threats caused by the change in consumers’ shopping habits and the move towards internet-based purchases.