Merchants who sell through eCommerce business platforms have a responsibility to protect their customers’ data, but a recent report found just how important it is to customers that their private information is protected. According to PYMNTS’ May 2021 Securing eCommerce study, 65 percent of eCommerce shoppers are likely to stop doing business with a company that undergoes “even a single instance of data theft or payment fraud.” Protecting customer data is essential to retaining shoppers’ trust and maintaining a stable customer base.
How Customers Feel About Data Safety
People are driven to share personal information on many of the websites, apps, and services they use daily, with no way to avoid it if they want to use the service. This leads to reluctance to use new services and creates an invisible cost of adoption that users need to consider. Data breaches occur regularly, leading to consequences for consumers ranging from account takeovers to serious financial fraud that costs them money and creates stress. Especially in cases where payments are involved, consumers will be extremely cautious about giving out their information.
Online and mobile commerce platforms allow many payment methods, but many customers approach payment in a traditional way, entering their full credit card information at guest checkout. They may be unwilling to save this information for repeat use because they are worried about their account getting stolen, even if it would let them make purchases more quickly and avoid re-entering the same information. 71 percent of eCommerce business users reported paying by entering their credit or debit card information at guest checkout at least some of the time.
The older generations expressed the most likely to react negatively to data breaches or fraud, at 80%, while younger people were somewhat less likely to terminate their relationship with merchants over fraud or data theft, only around 50 percent.
The pandemic caused many customers to increase their usage of eCommerce business over physical store purchases, but it also increased their level of concern about data security. 48% of those surveyed said that they are more worried now about data security than they were before the pandemic. In times like these, they may stick with familiar sites that they trust and avoid using new ones.
How merchants can respond for eCommerce business
To prevent losing customers, merchants need to protect their eCommerce business platforms from data breaches, hacks, and fraud that harm their customers. The challenge is to do so without limiting customer access; tools like CAPTCHAs, verification codes, and complex passwords can discourage signups. However, better security also assures customers that their data is being protected, which may counter this issue and make them more willing to join. Screening for bots and fake logins also reduces the burden on eCommerce sites, helping them run faster and preventing purchases from fraudulent accounts.
Offering secure third-party payment options is another solution; paying through a trustworthy go-between like PayPal or Apple Pay means that the customer never has to give away their payment information to a source they don’t trust, and the fees paid by merchants are not significantly different from credit card processing fees.
Vendors that do accept credit card payments can benefit from saving the information to use for repeat purchases, but they should secure it with encryption so it can’t be stolen by hackers. The PYMNTS study found that 36% of eCommerce customers use their preferred online payment method because they feel there is less risk of data theft.
Other visible security measures such as SSL certificates are essential because the customer can see them in action. In addition, having a clear data policy that avoids collecting unnecessary data will also reassure them in case their account is compromised.
Merchants need to always consider how cyberattacks can affect both their business and their customers. 34% of businesses say that their biggest challenge moving into the digital world is cybersecurity, and they cite cyberattacks and privacy breaches as their #1 threat. Customers need to be able to trust companies when they go online. Using the same standards and practices as leading companies, integrating secure payment and data protection systems, and reassuring customers of their dedication to guarding their data are the key steps toward avoiding lost customers over fears of data theft.