Protecting Retailers From Cyber-Risks This Holiday Season: A Guide for MSPs

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As holiday shoppers flock to websites and brick-and-mortar shops, retailers are looking forward to the profits those sales will bring. What they’re not looking forward to is the prospect of a cyberattack during this all-important shopping season. Retail operations need to prioritize mitigating cyber-risk during this critical period, and many of them will be relying on IT professionals, including managed service providers (MSPs), to overcome the myriad cybersecurity obstacles that they face this time of year.

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What are the most common cyberattacks that retailers face?

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Whether they’re selling gifts in the mall or selling goods online all retailers face a wide variety of cyberattack risks all year round. However, those risks become especially intense during the winter holiday season. More traffic and more transactions create more opportunities for bad actors to strike than the rest of the year. According to the industry trade publication Chain Store Age, these are the top three cyberattacks that retailers experience during the festive season:

1. Supply chain attacks (52%)
2. Data breaches (48%)
3. Phishing attacks (32%) and Denial-of-Service (DoS) attacks (32%)

Source: Chain Store Age

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Retail cyberattacks deliver an expensive aftermath

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A data breach is an expensive proposition for any business, and that includes all types of retailers. According to the IBM Cost of a Data Breach Report 2024, the cost of a retail data breach stands at $3.48 million, up 18% from the 2023 cost of $2.96 million. The sharp rise in breach costs for retailers is likely caused by a combination of inflammatory factors. The increasing sophistication of cyberattacks, including a surge in AI-driven cyberattacks, has led to more expensive damage and more complex incident response requirements. Tightening data privacy regulations with expensive noncompliance penalties also ratchet up data breach costs.

Reputation damage is another devastating consequence of a successful cyberattack or data breach. More than half (53%) report that cyberattacks have negatively impacted their reputation, causing customers to lose trust and often turn to competitors. In an industry where brand loyalty is essential, this can have severe financial consequences. That’s a major reason why 44% of retailers admit that they’ve withheld details of incidents from the public in an attempt to protect their brand image. This short-term fix may backfire in the long term if the details of an incident become public knowledge.  

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6 Major cyber-risks retailers face during the holidays

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Although retailers face relentless cyberattacks all year round, the holiday season brings a sharp increase in cyberattack stress for retail businesses. Over half of retailers (52%) feel particularly vulnerable during the holiday season, as increased transaction volumes and digital reliance create prime opportunities for cybercriminals. Here are six major cyber-risks that retailers face during the holiday season:

1. Ransomware attacks

Cybercriminals love to mount ransomware attacks against retailers during peak sales periods, knowing downtime is costly. Attackers know this is an opportune time to hold retailers hostage and demand hefty ransoms to restore critical systems.

2. Phishing campaigns

Phishing attempts increase significantly during the holidays. Threat actors exploit the influx of seasonal employees who may be less familiar with company protocols and target customer service channels with fraudulent inquiries. Over half of seasonal retail employees (56%) do not receive phishing simulation training.

3. Point-of-sale (POS) attacks

POS systems are vulnerable to malware attacks aimed at stealing customer payment information. With physical and digital sales channels active, securing these systems is a priority.

4. Botnet and DDoS attacks

Distributed Denial-of-Service (DDoS) attacks pose a significant risk to eCommerce platforms. Compounding this issue is the rise in advanced bad bot traffic, which has increased by 58% compared to last year. Evasive bots now account for 70% of harmful traffic targeting retail sites, a major jump over the average of 51% seen on other sites.

5. Behind-the-scenes complications

Retail businesses also face a variety of back-office cybersecurity challenges, including staff shortages (50%), lack of training programs for seasonal workers (46%) and limited IT resources (52%).

6. AI attacks

Retail websites face an estimated 569,884 AI-driven attacks daily. The most common AI-enhanced attack against retail sites is business logic abuse, accounting for 30% of AI-driven attacks. In a business logic abuse scenario, bad actors may exploit the intended functionality of an application to manipulate promotional codes or exploit return policies.

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How MSPs can help reduce cyber-risks for retailers

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IT professionals can offer advice and assistance to retailers that can help them safely navigate this dangerous season, including implementing advanced threat detection systems, securing payment infrastructure and conducting regular employee training to mitigate people-related risks.   

Deploy advanced endpoint protection

Implement robust endpoint detection and response (EDR) solutions to protect POS systems, workstations and other devices against malware and ransomware. Regularly update software to patch vulnerabilities.

Make security awareness training a priority

Even temporary or seasonal hires must receive regular security awareness training. Unfortunately, 78% of seasonal workers are not educated about social engineering, and 56% aren’t trained in safe internet use.

Strengthen network defenses

Use firewalls, intrusion detection systems and network segmentation to isolate critical systems like payment gateways. Proactively monitor networks for anomalies using managed SOC services.

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Implement zero trust architecture

Adopt a zero trust security framework to ensure access controls are enforced for every transaction and user, minimizing the risk of insider threats and unauthorized access.

Create an incident response plan

Work with retailers to develop and test incident response plans tailored to their needs. This ensures swift action in the event of an attack, minimizing downtime and data loss.

Secure eCommerce platforms

Encourage the use of secure payment gateways, SSL/TLS encryption and bot management tools to protect online transactions and customer data.

Pay attention to compliance

Assist retailers in meeting regulatory requirements, such as PCI DSS standards for payment card security, to avoid penalties and enhance consumer trust.

By proactively addressing the unique cybersecurity challenges of the holiday season, IT professionals can help retailers maintain smooth operations, secure customer trust and enjoy a profitable winter holiday season.

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Mitigate cyber-risk for retailers affordably with our solutions

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Our smart solutions help IT professionals mitigate cyber-risk for retailers and other businesses all year round, including the added pressure of peak seasons, effectively and economically.

BullPhish ID – This effective, automated security awareness training and phishing simulation solution provides critical training that improves compliance, prevents employee mistakes and reduces a company’s risk of being hit by a cyberattack.    

Dark Web ID – Our award-winning dark web monitoring solution is the channel leader for good reason. It provides the greatest amount of protection around with 24/7/365 human- and machine-powered monitoring of business and personal credentials, including domains, IP addresses and email addresses.   

Graphus – This automated anti-phishing solution uses AI and a patented algorithm to catch and quarantine dangerous messages. It learns from every organization’s unique communication patterns to continuously tailor protection without human intervention. Best of all, it deploys in minutes to defend businesses from phishing and email-based cyberattacks, including zero day, AI-enhanced and novel threats.  

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