June 20, 2016
Online shopping trends indicate consumer security concerns
Music, movies, cars, clothing, prescription medications, groceries, even fresh-baked cookies delivered to your door with a glass of milk at midnight – these days, you can buy almost anything online. It’s quick, it’s easy, and the options are almost endless. Still, according to the Census Bureau of the Department of Commerce, only 7.8 percent of sales in the first quarter of 2016 were e-commerce sales. Why?
A 2015 survey of more than 41,000 American households conducted by the National Telecommunications & Information Administration for the United States Department of Commerce found one contributing factor: lack of trust in internet privacy and security. When asked to identify what they were most concerned with regarding online privacy and security risks, unprompted by suggestions, 84 percent of online households provided at least one concern, and 40 percent named at least two. The concerns given were led by identity theft at 63 percent, and followed by credit card or banking fraud, data collection or tracking, loss of control over personal data, government data collection or tracking, and threats to personal safety.
Where does this concern come from, and how much does it actually affect consumer activity?
The survey found that “privacy and security concerns were even more prevalent among online households that had been affected by a security breach during the year prior to the survey.” Approximately 10 percent more households that had experienced a security breach named identity theft and, separately, data collection or tracking by online services as concerns than those who had not experienced a breach.
The fear actually does drastically affect the way the concerned consumers operate online as well. Forty-five percent of households with at least one internet user said that their concerns had stopped them from conducting activities online, including buying goods or services. Thirty-three percent specifically concerned with credit card or banking fraud didn’t buy goods or services online (compared to 21 percent of those who did not share that specific concern).
Considering the anxiety many shoppers have over conducting transactions online, brick-and-mortar retailers have an opportunity to offer an in-person interaction and potentially ease their fears. The chance to choose their payment type and interact with a friendly associate will help create an excellent customer experience that keeps them coming back time and time again.