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Risks and Benefits of Offering Free Store Wi-Fi

Today’s smartphone-addicted culture is full of consumers who are quick at on-the-spot information gathering, and those customers are eager to use free Wi-Fi to connect to the Internet where they can.

At any moment, shoppers can check product availability, look at competitor pricing, read reviews and search for digital coupons.

Offering free in-store Wi-Fi may be a way to accommodate what customers are already doing, show your confidence in your ability to match competitor pricing, improve in-store experiences and keep shoppers inside your store longer.

In a 2015 EarthLink and IHL Group study, nearly one-third of retailer respondents (28 percent) say they have experienced a positive impact on customer loyalty, an increase in the amount of time customers spend in their stores and a 2 percent increase in sales as a result of offering in-store Wi-Fi.

Offering Wi-Fi in your store may provide strong benefits to both you and your customers, but also comes with risks.

A recent report from the National Retail Federation considers several expert opinions to identify four main areas of concern for retailers when it comes to offering in-store Wi-Fi.

Prevent Wi-Fi From Becoming a Gateway for Cyberattacks

Improperly designed and implemented free Wi-Fi systems open opportunities for hackers to get retailer information, including from point-of-sale systems.

“Data breaches related to Wi-Fi are usually the result of an organization’s failure to sufficiently secure the wireless systems used to transmit sensitive data,” says Zach Capers, research specialist with the Association of Certified Fraud Examiners. Capers goes on to explain that breaches that expose consumer information are typical of cyberattacks.

Deena Coffman, CEO of IDT911 Consulting, recommends conducting regular security audits with a third party to identify potential risks.

Comply With All Legal Requirements

 Requiring a password to use the network and the configuration of the Wi-Fi networking are important, according to the experts.

“Free Wi-Fi systems should be hosted on a stand-alone network that is not connected to systems that hold sensitive data,” Capers says. “If the Wi-Fi is not on a stand-alone networking, businesses should ensure that any potentially sensitive data is secured and protected by a firewall.”

When launching a free Wi-Fi service, be sure to remain compliant with relevant laws and regulations such as the Communications Assistance for Law Enforcement Act. Data security standards must be met if credit card transactions are processed through the Wi-Fi portal.

Create a Business Case

When considering whether or not to implement free Wi-Fi in your store, be sure to weigh the costs and benefits. Determining the impact or profitability of Wi-Fi may be done through a pilot project, where you track usage and searches.

In a smaller operation, conducting a customer service survey focused on your customers’ opinions on in-store Wi-Fi may be helpful. If you choose to offer free Wi-Fi, then it’s crucial that the benefits outweigh the risks.

Risks of Wi-Fi hacking don’t end when all your customers leave your store.

Free Wi-Fi “opens a huge window of opportunity for hackers who can mimic a network in order to get a device to reconnect. It’s a playground for attackers that nobody realizes,” says Mark Wuergler, a senior security researcher with Immunity.

Wuergler explains that there is no way to protect yourself 100 percent when it comes to Wi-Fi, and the convenience such systems provide to customers are equally convenient to hackers.

Consider Insurance

 Wi-Fi connectivity is something the insurance industry “has not addressed specifically, to my knowledge,” says Richard C. Keating, president of Trinity Brokerage.

“Cyber insurance has gained in popularity over the last five years and may provide a solution for business owners, as long as the business’s Wi-Fi information, including security measures, is disclosed when securing or renewing a policy,” he says.

Keating says that the questions retailers should be asking when looking to install a wireless network include: Is it public facing? Are point-of-sale devices connected to the same network? Is the entire Wi-Fi network setup for patrons and customers who cannot also gain access to the insured’s network through the connection?

Contact your insurance broker to learn more.

 

About Hilary Welter

Hilary Welter
As marketing and research coordinator, it’s Hilary’s duty to keep retailers informed about NRHA products and services and to help coordinate industry research projects. Additionally, Hilary is the voice behind NRHA’s and Hardware Retailing’s social media accounts. She appreciates a good book, spicy food, well-made horror films, craft beer and exploring new places near and far.

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