Social media "incidents," including security breaches and negative publicity, have real financial costs associated with them, according to Symantec, which recently reported the results of its 2011 Social Media Protection Flash Poll, surveying 1,225 executives in 33 countries around the world.
Among businesses which reported experiencing social media "incidents," fully 94% said there were serious ramifications including revenue loss, data loss, reduced stock price, loss of customer trust, and litigation costs, not to mention general damage to their brand reputation. What's more, companies are liable to become victims of social media incidents (or victimize themselves through social media) more than once: the typical business reported experiencing nine social media incidents over the last year.
The single most common type of social media incident was employees over-sharing on public forums, with 46% of survey respondents citing at least one example in the last year. This was followed closely by loss or exposure of confidential information, at 41%, and exposure to litigation at 37%.
Like all good engineers, the Symantec folks had some quantitative (and alarming) data for the actual costs associated with social media incidents: the average loss in stock price came to $1,038,40, average litigation costs were $650,361, direct financial costs were $641,993, and lost revenue was $619,360. While I'm not sure quite how they calculate the costs of damage to brand reputation and loss of customer trust, the tally here came to $638,496.
All these findings should help stoke executive paranoia about social media and in turn scare up some new business for Symantec, as they surely intended (what, you thought they survey out of the goodness of their hearts?). And some other survey results will serve to further stoke the paranoia: the Cisco 2010 Midyear Security Report, which surveyed employees from around the world, found 50% said they ignored corporate policies which ban social media in the workplace, and over one quarter of the employees surveyed said they had changed the security settings on their work computers so they can carry on their social media activities unhindered.
Still, it would be a mistake to think bosses are unequivocally opposed to social media. Earlier this month I wrote about a survey by Robert Half Technology of 1,400 chief information officers from companies with 100+ employees, which found 51% said they permit employees to use social media sites for business purposes -- up from 19% in 2009. Meanwhile proportion of CIOs who said social media use at work is "prohibited completely" decreased from 54% to 31% over the same period.