The Cost of Network Outages
It’s no surprise that network downtime can cost businesses money, but just how expensive it can be is often underestimated. In 2018, Amazon suffered an outage on one of its biggest sales days of the year, Prime Day. It was down for a mere 13 minutes. That small amount of time was enough for the world’s biggest online retailer to lose nearly $100 million dollars.
Even for small and medium-sized businesses, crashing offline for even minutes can end up costing thousands to tens of thousands of dollars. Gartner puts the average cost at $5,600 a minute for businesses across industries. Without its network, a business can lose the ability to attend to customers with in-store digital signage, scan credit/debit cards, track inventory, and other essential tasks. Operations can come grinding to a halt.
For restaurants and retailers, the lost revenue is immediate. When these businesses cannot process debit and credit cards, customers who don’t happen to have cash on hand are turned away. The sale that was once firmly in hand is lost, perhaps to a nearby business that has a failover solution in place.
This is not an uncommon occurrence. Eighty-one percent of retailers experience downtime at least once a year. A study by Accelerated Concepts indicates that the disruption in business operations loses customers for 72% of retailers. But losing sales is just one consequence of network outages. Downtime can cost your business in other, often far-reaching, ways:
- Damaged brand reputation: Around one in three report that their brand reputation gets damaged when their networks go down. Outages can severely and negatively impact customer experience, pushing valuable customers away. It’s often said that acquiring a new customer can cost five times more than keeping an existing customer.
- Security risks: When your business’ network is down, it provides an avenue for cyberattacks from criminals. Between the expenses of forensics, investigations, hotline support, potential settlements, resulting in lower customer retention, and more, the aftermath of a data breach can cost millions. The global average cost of a data breach is valued at 3.86 million by IBM.
- Lower employee productivity: More than half of retailers experience a drop in employee productivity due to network outages. Furthermore, a UC study indicated that it can take 23 minutes on average for employees to get back on track after an interruption.
Nearly a fifth of businesses feel unprepared for an outage. If your business is in that number, don’t wait until a disaster strikes to ensure your network’s uptime. You can protect your business from the costly consequences of network downtime with CyberReef’s MobileWall solution for unlimited wireless failover, UptimePlus.