Friday 22 January 2016

#TalkTalk Trouble as 7% of Customers Leave Following Data Breach

Remember the TalkTalk breach four months ago (for a recap, here is my blog on it) well new statistics came out yesterday by Imran Choudhary from the market watcher Kantar Worldpanel. 
These figures claim that the firm lost 7% of its broadband customers in the fourth quarter; with their customers turning to different providers. BT was the biggest winner by picking up 40% of this lost share. Nearly a fifth of those leaving TalkTalk did so directly as a result of poor reliability. 
TalkTalk share of the home services market fell by 4.4% from the previous quarter in terms of new customers. 
Imran argued that “customers have lost faith in TalkTalk as a trustworthy brand.”
He goes on to say “TalkTalk continues to offer some of the most attractive promotions across the home services market and almost a third of its new customers did choose it for this reason, but there can be no doubt that it lost potential customers following the major data hack,” Choudhary added.
“If it’s to recover from recent events TalkTalk will need to offer more than just good value.”
In the end it was claimed that 'just' 4% of customers had sensitive data exposed in the cyber attack – amounting to fewer than 160,000 users.
However, the firm was widely criticized for its muddled media response, and its refusal to waive substantial account termination fees unless customers could prove money had been stolen from their bank accounts as a direct result of the breach.
Shareholders actually responded pretty well to TalkTalk’s hardline stance on exiting customers, with shares rising 12% after the firm’s 1H 2015 financials were released.
However, TalkTalk has already admitted a one-off bill of £35m would have to be paid to cover incident response, external consulting and increasing call volumes as a result of the incident.
CEO Dido Harding claimed in the aftermath of the attack: “in the end our customers will judge us over the course of the next few months, and not by mine or anyone else’s words right now".
For the full article from Kantar Worldpanel click here

We, as an Industry, continue to learn from these kind of breaches. I recently wrote a blog on just this - see here for more information 

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