‘Social Media Incidents’ Cost Typical Enterprise $4 Million in the Last 12 Months

Does your organization have a clear social media strategy in place, and is your brand able to protect itself from the potential negative consequences of using social networking sites? Symantec Corp just announced the findings of its 2011 Social Media Protection Flash Poll, exploring the systems organizations have in place to protect themselves from potential blunders on social sites including Facebook, Twitter and other online forums.

According to the poll, the average company experienced nine ‘social media incidents’ in the last year, and 94% suffered negative consequences as a result of such incidents, including damage to their reputations, loss of customer trust, data loss and lost revenue.

The survey found most social media incidents over the last year could be attributed to these areas of risk:

  • employees sharing too much information in public forums (46%)
  • the loss or exposure of confidential information (41%)
  • a damaged brand (40%)
  • increased exposure to litigation (37%)

Such incidents cost the typical company a whopping $4 million over the past 12 months, through negative consequences including:

  • reduced stock price (average cost: $1,038,401)
  • litigation costs (average cost: $650,361)
  • direct financial costs (average cost: $641,993)
  • damaged brand reputation/loss of customer trust (average cost: $638,496)
  • lost revenue (average cost: $619,360)

The more organizations communicate via social media, the greater the risk of publishing confidential information.  Are companies aware of these risks, and are they reacting by putting solutions in place?  Does your company offer education and training on the proper way for employees to use social networking for business purposes?

According to the poll, 87% of enterprises are considering putting social media policies in place, and 86% are considering employee training.

Symantec also quotes research from Gartner: “by year-end 2013, 50 percent of all companies will have been asked to produce material from social media websites for eDiscovery.” Businesses may also be asked to provide records of social media communications by regulatory authorities, and need to have a system in place to readily provide this information.  According to the survey, 82% of enterprises are at least discussing implementing archiving solutions to serve this purpose.  Symantec recommends archiving social content (not surprising, since the company produces such software), but also stresses the importance of employee education and training.

While many enterprises are considering the remedies listed above, less than one-fourth have actually implemented these technology and policy solutions.  Considering the numbers above, why are enterprises lagging in the area of social media training, policy, and archiving content, when money and their reputation are on the line?

Symantec’s Social Media Protection Flash Poll was conducted in April 2011 by Applied Research, and surveyed IT and C-level professionals responsible for computers, networks and technology resources at small, medium, and large enterprises. There were 1,225 respondents in 33 countries worldwide.

See the full results here: