Data loss prevention: What is it?

For business owners, losing sensitive business data can have serious consequences. Whether it's an email attachment sent to the wrong person or a cyber hacker stealing customer details, data loss can damage your reputation and your finances.

In this guide, we’ll take a look at what data loss prevention (DLP) is, the different types of data loss and how to protect your business from this situation.

What is data loss prevention?

Think of data loss prevention as a cybersecurity strategy designed to stop sensitive information, like financial records, customer data or internal documents from being shared, leaked or stolen.

Threats can come externally (like cybercriminals), or even from within your business when staff make mistakes. DLP helps avoid data loss by monitoring, identifying and blocking actions before they cause a problem.

What are the different types of data loss?

It’s essential to understand these risks to help you create a DLP plan. Here are some ways your data could disappear or get into the wrong hands:

• External threats: Cyberattacks, phishing scams and malware can steal your data.

• Internal threats: Staff errors or carelessness, like emailing the wrong attachment or storing sensitive information in an unsecured folder.

• Hardware failure: Technology can break and if you don’t back up your data, it could get lost.

• Natural disasters: Acts of nature like fires and floods can wipe out servers and systems.

Why does DLP matter for SMEs?

SMEs can be prime targets for data theft, as they often have fewer defences which makes them easier to attack and exploit.

Here’s why DLP is important:

• Customer trust: Your customers expect their data to be safe as standard. A breach could break their trust.

• Compliance: If the data you hold isn’t protected, it means you're not complying with regulations such as GDPR. This can result in large fines.

• Reputation: A data leak can damage your brand image.

• Cost savings: The average cost of a data breach for SMEs is tens of thousands, so prevention is a lot cheaper.

• Visibility: DLP tools give an insight into where your data is and who’s using it.

The average cost of a data breach globally was over £3.6 million in 2024. For SMEs, even a small percentage of that could be catastrophic.

What are the three types of DLP?

The three main types of DLP are:

• Network DLP: This monitors and protects data in motion across your business, like emails and file transfers.

• Cloud DLP: This looks at data stored and shared in cloud services such as Google Drive.

• Endpoint DLP: This protects data on individual devices like laptops and phones.

Depending on the set up of your business, you might need one, two or all three of these working together.

Implementing DLP for your business

Here’s how to begin building your DLP strategy:

• Assess the risks: What sort of data do you deal with? Where do you keep it? Who has access?

• Research cost-effective tools: There are many low-cost DLP solutions tailored to small businesses. Check out G2 Software to find more.

• Have clear policies: Communicate how data should be handled, shared and stored.

• Train your team: Staff need to understand what is confidential and how to prevent mistakes.

• Regular audits: Your policies and tools should be reviewed often as your business grows and technology evolves.

Keep your business secure

By implementing a DLP strategy and setting up the right systems, you’re helping to protect your business.

If you have questions about data security, our V-Hub Digital Advisers are here to help.