Dealership’s exposure to cybersecurity attacks top concern for potential buyers, our survey found
Getting to Go! surveyed Scali Rasmussen LinkedIn followers and those on our email list regarding cybersecurity concerns when acquiring a dealership. The top concern was how much exposure a dealership has to cybersecurity attacks.
That highlights the importance of investing in the most up-to-date cybersecurity technology, but a recent report by Experian suggests businesses are not prioritizing investment to fight a growing area of cyberattack.
In the Getting to Go! survey the three choices were:
- Is this dealership FTC compliant where cybersecurity measures are concerned?
- How much will it cost to bring this dealership’s cybersecurity measures up to my standards?
- How much exposure does this dealership have to possible cybersecurity attacks?
As mentioned, exposure to cyberattacks garnered the most votes. While dealers say they are concerned about cyberattacks, Experian’s 2024 U.S. Identity and Fraud Report suggests some gaps.
The report didn’t specifically address dealerships, but Jim Maguire, Experian’s senior director of product marketing, says “the findings absolutely apply to the auto industry.”
“Given the high price point of today’s vehicles and the increasingly digitalized car-buying process, fraudsters naturally target auto dealers and lenders.” he added.
Forty-five percent of respondents in the report indicated cybercrime was the top-ranking operational challenge putting the most stress on businesses. Generative Artificial Intelligence, or GenAI, ranked second at 41%.
But businesses are not prioritizing investing in technology to combat GenAI fraud and deep fakes – in fact, it ranked only 12th in the list of most important potential investment areas for businesses in 2024.
Businesses are aware of the potential of GenAI but they seem to be focused on its ability to improve the customer experience rather than its potential to harm both a dealership’s business and its reputation.
Experian found the top-ranked investment area for 2024 was “implementing new analytics methods and new Artificial Intelligence models to improve customer decisions” chosen by 17% of respondents. In second place, chosen by 14%, was “improving how we detect and prevent cybercrime.”
Meanwhile, Experian warns that fraudsters have seen the benefit of leveraging GenAI and that it is already “supercharging” criminal efforts to “defraud businesses and consumers alike.”
Maguire recommends dealers “combat technology with technology.” That means investing in advanced data and analytic solutions to identity potential fraud. That doesn’t seem to be happening on a large scale with businesses in general.
The survey found that among the fraud prevention methods used most frequently, physical biometrics (71%), PINs sent to a mobile device (70%) and behavioral analytics (66%) evoke the highest sense of security for consumers.
But fewer than 30% of businesses use physical biometrics and behavioral analytics for fraud prevention.
Yet, investing in such advanced fraud prevention technologies will both mitigate risk for dealerships and build customer trust. Maguire says.
“Some would argue that trust is a critical form of currency in a highly competitive market,” he says. And the retail automotive industry is certainly highly competitive.
Of course, cybersecurity hardening in the dealership space is complicated by the vast array of electronics used to store, transmit, and analyze customers and other sensitive data. Dealers who harden their own networks should hold all IT vendors and marketing partners to the same hardened standards.
This article was written for Getting to Go, a buy/sell newsletter from Scali Rasmussen.