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As consumers shop across multiple online and offline channels, their personal information passes through many different systems, expanding the risk of cyber attacks.
Hackers know stealing consumer data from retailers can be incredibly lucrative, and recent breaches demonstrate that they are increasingly targeting the retail industry specifically.
This article will clearly explain the path customer data takes within retail IT environments. You’ll also learn about the emerging threats that place this data at risk, such as POS malware, supply chain tampering, phishing, etc.
Finally, you’ll learn best practices for locking down point-of-sale systems, securing customer data throughout its journey from stores to central databases, and broadly improving cybersecurity foundations across retail IT.
The Path Customer Data Takes In Retail
When a customer purchases in your store, their sensitive personal and payment information flows through several systems:
POS terminal: This is where staff collect payment and customer data like credit cards, contact info, etc., either by swiping cards, through mobile devices, or integrating with customer-facing technology like self-checkout kiosks.
In-store server: The POS terminals connect with an on-premises server to process the transaction. This server stores duplicate transaction records.
Network connections: The in-store server then passes data to your central data infrastructure through wired or wireless internet connections.
Cloud-based retail apps: Many retailers now use SaaS solutions for POS, inventory, or order management, integrating customer data from stores with cloud platforms.
Data centers: Within a retailer’s centralized data center, customer data from online, mobile, and brick-and-mortar stores combine within databases. Integrating data from disparate channels in one place enables a 360-degree customer view.
Back-end business systems: Finally, ERPs, CRMs, and other back-end software also connect to this database to streamline business processes.
As you can see, customer data takes a convoluted path, passing through many environments outside the retailer’s firewall. This complexity widens the attack surface and allows more opportunities for data compromise.
Emerging Cyber Threats To Retail
If you’re in retail today, the unsettling reality is that you are sitting on a goldmine of data that cybercriminals would be itching to get their hands on. To make matters worse, the threat landscape isn’t exactly static either. It’s constantly shifting as attackers come up with new methods to get past your defenses.
So, what exactly are you up against? Let’s have a quick breakdown of the threats facing retail in 2025 and beyond.
POS Malware: Malicious code that lives in your payment terminals, silently stealing card data before it is encrypted. This runs completely under the radar, potentially stealing thousands of customers’ details while your systems appear normal.
Supply Chain Compromises: Your vendor delivered that new equipment, but who handled it before it reached you? These attacks target your trusted suppliers, tampering with hardware or software before it even arrives at your stores.
Web Application Vulnerabilities: Hackers exploit hacks in customer-facing apps in an attempt to get access to your backend database. This bypasses any security you have in place. All it takes is one coding mistake and you could open up a backdoor for bad actors.
Phishing: Why hack through your firewall when an employee will unwittingly open the door? Phishing attempts look to trick your staff into handing over sensitive data and installing malware.
Ransomware: Ransomware attacks encrypt all of your data and hold you to ransom until you pay criminals the fee. This can bring your business to a screeching halt (and cost you a fortune in ransom payments).
Insider Threats: Sometimes, the danger lurks within your own company – whether it’s a disgruntled employee, or a careless worker who mistakenly gives access to hackers. These threats can be particularly damaging as they sidestep your entire perimeter defenses.
Best Practices For Retail Cybersecurity
So, where should retailers start? By implementing a multi-layered strategy addressing the unique security needs at different points along the path shopper data takes – from initial collection via POS terminals all the way to storage in centralized databases as part of a single customer profile. Key priority areas include:
Hardening POS systems using a combination of access controls, system isolation measures, encryption, continuous patching, and advanced threat monitoring. POS malware remains one of the top attack vectors.
Strengthening data security via end-to-end encryption at rest and in transit between IT environments, tokenizing data so only useless tokens are stored, strictly limiting access to sensitive information, and masking data to remove visibility of confidential details.
Detecting attacks rapidly with security analytics tuned to spot unusual user activity and catch threats early before they cause major damage is crucial. Next-gen endpoint detection, network monitoring, and database activity monitoring are crucial.
Building organizational resilience through regular personalized cybersecurity training, implementing policies and change control processes that embed security into retail operations, conducting incident response simulation tests, and mandating controls for third-party vendor access. People and processes represent vulnerable threat surfaces, too.
Final Word
This “defense in depth” approach secures the modern, digital shopping realm across online, mobile, brick-and-mortar, and backend operations. By taking a layered approach to security—hardening vulnerabilities across point-of-sale devices, encrypting and controlling access to data everywhere, monitoring networks, and preparing staff and incident response plans—retailers can enable safe innovation in omnichannel retail while keeping customer data protected.
