Insecurity leads to a third of costumers leaving, plus legal and compliance costs.
A third of customers prefer to avoid companies that have suffered data breaches, according to a study by Javelin Strategy & Research.
Commissioned by security firm Identity Finder, the report revealed about 33% will shop elsewhere if a company suffers a breach, 30% will change healthcare provide and a quarter will switch their bank.
Al Pascua, senior analyst of Security, Risk and Fraud at Javelin, said: "That's real money lost in customer churn and reduced sales, and certainly demonstrates how the reputation of the organisation hits the bottom line.
"It's noteworthy that about a third of people will go as far as to find a new doctor, if their provider is breached, as we all know healthcare services can be a big hassle to change."
Data breach not only hits revenue it adds up the expenses including cost related to compliance, legal, and victim reparation costs.
Following data breach at US retailer Target, the company reported loss of revenue and a drop in stock prices. It spent $61m on investigations, credit-monitoring services, extra call centre staff and legal services, the report added.
Identity Finder chief executive Todd Feinman said businesses are experiencing pressure to protect sensitive data not only from industry and government regulators, but also customers and shareholders.
"Consumer behavior indicates that data breaches impact both expenses and revenue," Feinman said. "Organisations must be more proactive in preventing a breach by understanding where a data leak can originate.
"By discovering and managing sensitive information at its source and not at the perimeter or after the fact, businesses can identify risk, change employee behavior, and justify where to spend security dollars."
Identity Finder suggests companies secure unprotected files, remove at-risk data, monitor policies and behaviour centrally, and comply with regulations.