Is the Hospitality Industry in Danger?

Long back in 2005, Meyers and Mills had said that using biometric technologies could improve hotel security and enhance the ability to recognize criminal activities. Fast forward to 2016 and we are seeing that the hospitality sector has become an easy prey for cyber criminals.

The leap in technology has made it easy for the hospitality industry to gather a lot of personal
data about customers that has helped them increase sales and profit margins. A recent report by Sabre Hospitality Solutions confirms that the proper use of Big Data generated can give a ‘definitive market edge’ to hoteliers.

It’s Green for the Hackers!

This has also made it easy for hackers to commit financial crimes at a larger scale. While hackers attack smaller enterprises as they usually have systems that can be easily breached, they hack into bigger franchises for gaining access to a global database. Especially for the hospitality sector, this is due to day-to-day operations of the industry involving online reservations, card-based transactions, and rewards programs. This generates a humongous database of user data that, if exposed to the wrong hands, will create havoc in personal and financial lives.

Criminals across the globe try to hack into hotel networks to rob credit card details of guests. In essence, they are trying to target thousands of cardholders together. Not only do hotels may have vulnerable systems, they may be able to detect a breach long after it has occurred. An average time as per Trustwave Spider Labs is 173.5 days.

Cybercrime is a huge risk that hotels must deal with on a regular basis. Social engineering attacks such as phishing and Advanced Persistent Threats (APT’s) are the most dangerous types of cyber-attacks as they can bypass the current security setup. Hotel Wi-Fi networks therefore need to be secure, with built-in wireless intrusion prevention and detection for enhanced security.

Sample this: As per the 2015 Trustwave Global Security Report, the global hospitality industry now sits on top of the three industries most frequently targeted by hackers.

The Challenge

This challenge of data security and safety also increases the liability of the hospitality industry as any security breach may lead to heavy financial losses (legal), loss of brand and reputation, and also loss of customer loyalty. This will lead to financial instability and failure in the long run.

Repercussions of a Security Breach

Hotels have to spend through their nose if there’s a breach of private data. The areas where the cash will flow usually cover legal processing, fines, penalties, forensic investigation expenses, credit monitoring, business interruption losses, and hiring PR professionals to help control damage and save reputation. Additional costs are required towards recovering lost data and fixing the actual cause of breach.

Several organizations that analyse security and data breach trends cite hospitality as the ‘single most vulnerable industry’. Thus, IT leaders in hospitality are making data security their number one priority.

There are Ways to Stop This Loss

Most states today have privacy laws for issuing notifications if anyone’s personal or financial information is compromised, lost, or stolen. To add on, there are multiple practices that support data loss prevention (DLP), such as the Payment Card Industry Data Security Standard (PCIDSS) that ensures ‘that all companies that process, store, or transmit credit card information maintain a secure environment’. Practices such as PCIDSS if implemented properly, can help control a lot of such incidents.

Hotels of any size must secure their network to protect hotel operations and guests’ data. They must also annually review their information technology to proactively respond to threats. To save themselves from the fate that even the likes of Hilton, Marriott, Mandarin Oriental etc. could not avoid, hotels need to employ the best security experts that can suggest digital encryption strategies about point of sale (POS) terminals, data servers and internal networks.

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