Today, every business is under pressure to meet customer expectations on products and services, but also to deliver a seamless digital experience. According to Pew Research Center, 50 million American consumers are mobile-only, representing a clear shift to mobile channels for conducting transactions. Not only is this changing consumer behaviors, it’s also advancing fraud. This creates a perfect storm of challenges and opportunities for businesses that want to capture market share, keep customers happy and deter fraud.
What do we know about this growing preference for mobile transactions and its impact on interactions between consumers and businesses? How can businesses deliver an amazing experience while also verifying the identity of the person on the other end? These questions and more are answered in the Second Annual Consumer Digital Identity Study recently published by IDology, a GBG company. We launched this annual study to give the business community visibility into shifting consumer behaviors and their impact on identity and fraud.
This year’s study revealed several key trends:
Consumers Are Opening More Accounts on Mobile Devices.
Mobile-first is not a new concept, but as a growing number of consumers move towards opening accounts on mobile devices instead of computers, businesses need to start thinking strategically about the mobile onboarding experience. For the first time, consumers opened more new accounts on mobile devices (61%) than on computers (56%) over the past 12 months and 20 percent of consumers registered for new accounts exclusively on mobile devices, a 10 percent increase over last year.
From a business perspective, mobile gives potential and existing customers the ability to onboard and transact wherever, whenever. However, driving customer engagement requires businesses to create superior mobile experiences, while also making mobile security and validation a priority.
Consumers Have High Expectations for the Mobile Experience that Aren’t Always Met.
Less than half of respondents reported their experience with mobile account opening processes was “extremely” or “very” easy. They’re also willing to walk away if a process is too difficult. Thirty-seven percent abandoned signing up for a new account due to the effort or time it took. This equates to nearly 83 million people who abandoned signup last year, and most importantly, translates to lost business and less revenue.
The increase in abandonment is a symptom of a bigger phenomenon. In many ways, mobile devices have conditioned consumers to expect immediate gratification. They want one-click interactions that are simple and fast. Each additional step a business puts between itself and a customer creates friction that can have a negative impact on customer acquisition, retention, and revenue.
Consumers are Open to Technology that Simplifies Mobile Interactions and Processes.
Consumers value security, but we’ve already established that they also hate friction. Given the rise in fraud, how can businesses deliver everything consumers want while also keeping fraud out?
While the majority of study respondents were most likely to manually enter their information when completing online forms, they showed an openness to using technologies that could prefill their information. Beyond prefill, 34% were open to mobile document capture. Using a picture of a driver’s license to pre-populate a form or verify an identity is a relatively new tool with a variety of potential applications. In the last 12 months, more than 50 million Americans submitted a picture of their license using a smartphone as part of an identity verification process, according to the research.
Building Trust is More Important Than Ever.
Seeing countless high-profile breaches unfold has made Americans more aware of data protection and fraud. Seventy-eight percent of respondents believe that businesses need to protect consumer information, a 16% increase over last year.
Knowing that a financial organization was using better, more advanced identity verification methods would positively affect the decision to use that organization for two-thirds of study respondents. This is a dramatic 27% increase in the last 12 months. In 2018, only 56% felt the same way.
These findings show that the status quo is no longer acceptable. Identity verification is important to consumers and should be defined and marketed as a competitive differentiator. Building trust has greater implications today and can have a significant impact on retention, growth and thus, revenue.
Armed with this information, what can businesses do in response? Understanding the shifting consumer experience related to security, convenience and speed is the first step toward providing great customer service and ensuring loyalty and engagement. With the mobile future among us, businesses must redefine mobile interactions with consumers who demand better security without added friction.
A multi-layered approach to identity proofing can streamlines processes, introduce the right amount of friction at the right time and fulfill the need for identity verification without driving away customers. The combination of understanding consumer behavior and technology can lead to elevated trust, easy onboarding, increased business identity assurance and far less fraud. As the majority moves farther away from physical and closer to digital interactions, adjusting course to balance delivering a seamless mobile experience with deterring fraud is critical for success.
Christina Luttrell is senior VP of operations for IDology, a GBG company and leader in multi-layered identity verification and fraud prevention. In her 10 years at IDology, Luttrell has significantly advanced the company’s technology, forged close relationships with customers and driven the development of technology innovations that help organizations stay ahead of constantly shifting fraud tactics without impacting the customer experience. Luttrell has been recognized as one of the Top 100 influencers in identity by One World Identity.