A new survey reveals the financial benefit of customer trust for retailers, and what issues prevent it from being earned.
According to the “2023 Trust Premium Report” from digital commerce security platform provider Forter, 5,000 surveyed consumers in the U.S., U.K., Germany, Singapore and China are willing to spend 46% more on average with retailers they trust.
However, three-quarters (76%) of respondents reported having a negative online shopping experience in the past three months, and 77% said that they would abandon a purchase if the checkout experience is too difficult or time-consuming.
False declines were overall the most common negative online shopping experience. The U.S. had the highest percentage (56%) of false declines in the last 90 days, followed by Singapore at 48%. Millennial and Gen Z (49%)respondents are overall up to four times more likely to be falsely declined at checkout compared to Gen X (27%) and baby boomer (8%)respondents.
First-party data from Forster indicates that false declines are typically five to 10 times higher than actual fraud. Forter estimates based on this first-party data that for every $1 retailers lose to fraud, they forfeit $30 by declining legitimate consumers.
Forter first-party data also found that mandating account creation can cause, on average, 3 to 5% of consumers to drop off; while requiring consumers to validate their email addresses and phone numbers can cause an average 4 to 7% drop-off rate.
"Our report reveals the brands that win the next generation of shoppers will provide fast, frictionless and fraud-free shopping experiences — and establish a mutual trust with their consumers," said Michael Reitblat, CEO and co-founder, Forter. "Friction in the purchase process no doubt persists, but it doesn't have to go unabated. Balancing the importance of fraud prevention without impacting customer experience will be the next major test for retailers during the upcoming holiday shopping season."
The research was conducted by Opinion Matters in May 2023. The survey gathered responses from 5,000 adults aged 18 and older who have at least two active e-commerce accounts and shopped online at least once in the last three months in the U.K., U.S., Germany, Singapore and China. There were 1,000 respondents from each territory.