Safety and security most important when buying online, say shoppers
Buying online — a necessity for most during this pandemic, a hobby for many. But what do customers truly value when it comes to shopping online?
Burgeoning e-Commerce and m-Commerce (mobile commerce) markets such as Singapore, Indonesia, and the Philippines, are seeing huge uptakes in online sales.
However, a survey by fraud prevention provider Vesta found that merchants and customers are increasingly vulnerable to false declines, fraud, and poor payment experiences.
“Our survey has revealed that safety and security remain a top concern among online shoppers and there is an unspoken expectation of merchants to put in place the right solutions”, said Shabab Muhaddes, Vesta, General Manager, Asia Pacific.
“Unsurprisingly, shoppers also see the hassle of multiple verification and authentication as a top payment problem. Overall, the results of this survey indicate an obvious and urgent need for sophisticated solutions that oﬀer better protection against fraud, drive higher approvals while enabling a seamless consumer payment experience,” added Muhaddes.
Buying online only a pleasure when the payment experience is frictionless
The Vesta Online Payment Sentiments survey found that almost half (47%) of respondents have encountered payment problems in the last 12 months.
Across all payment methods, multiple verification and authentication is a top payment problem faced by one in three (33%) of respondents; followed by declined payments without valid reasons, experienced by one in five (22%) online shoppers surveyed.
Payment friction can frustrate customers who already buy from multiple brands — and they will not hesitate to shop at another site that oﬀers a smoother online shopping experience.
Furthermore, when companies show that they can provide safety, privacy, security, reliability, and exercise data ethics with their online programs or devices, consumers will have high digital trust in that brand or company.
Digital trust is important as it separates the wheat from the chaff — that is to say, dependable services from corrupt or unreliable ones.
Almost six in 10 (57%) of online shoppers in the three countries would stop shopping at the e-Commerce site should they encounter a problem when making a purchase.
Over half (54%) of those who have faced a payment problem when making an online purchase would also warn their family or friends about the merchant or eCommerce site, resulting in further potential losses in revenue for the merchant.
With an increasingly tech-savvy population where people look for security in positive reviews, the survey also found that 69% of online shoppers rely on past reviews from previous buyers to determine if a site is secure to purchase from.
This underscores the impact that a negative payment experience can cause on the merchant’s business in a competitive eCommerce industry.
The urgent need for mobile-first protection needs to be addressed
Southeast Asia is the fastest-growing mobile wallet market globally, with Indonesia and the Philippines poised for continued hypergrowth in mobile payments over the next five years.
Six in 10 (60%) of those surveyed in these two countries indicated that they prefer to pay using e-wallets, attributed to a large unbanked population and low credit card penetration.
However, of those who have encountered payment problems with e-wallets in the last 12 months, one in 10 (11%) of respondents from the two countries faced declined payment without a valid reason, causing revenue loss for merchants.
Whilst the latest practices in security have pointed towards MFA (multi-factor authentication) to enhance security, paradoxically, this has been identified as a top pain point amongst online shoppers. One in five (20%) experienced payment friction through multiple verification and authentication.
Balancing identity verification and frictionless shopping experience is key
Notably, three in five (57%) online shoppers in Indonesia share retail accounts with their friends or family, putting them at higher risk of fraud methods, such as account takeover.
This is concerning given Indonesia is the largest eCommerce market in Southeast Asia, estimated to grow to US$83 billion in 2025.
In Southeast Asia alone, one in three have experienced online fraud last year, with 71 percent who experienced identity theft; 66% from phishing activities, and 63% from account fraud.
Fighting fraud is complex and expensive, which is why it’s crucial for e-Commerce merchants to employ sophisticated solutions backed by machine learning to oﬀer protection against fraudulent cases. As such, it would be important for merchants to adopt a payment platform that addresses these issues for a smoother customer payment experience.
- Digitally Enabled Real Estate Starts With Simplifying Your Networks
- Grab will not replicate Shopee’s mass layoff amidst a weaker economy
- Nvidia: China remains a significant opportunity despite US ban
- Data management and AI adoption is critical in achieving enterprise success
- Are Uber, Rockstar and Optus facing the same cybersecurity challenges?