The widespread adoption of mobile has changed the way consumers interact with and perceive the world. It’s also impacted consumer expectations, raising the bar on customer experience and holding businesses accountable to deliver. For businesses, this presents both challenges and opportunities, particularly around identity verification.
A new report examines just how far into the era of digital and mobile identity we have advanced. In May 2019, IDology’s Second Annual Consumer Digital Identity Study was published, finding that for first time, consumers opened more new accounts on mobile phones than on computers. The study also uncovered a 19% increase in abandonment during account openings compared to last year, due to high consumer expectations for convenience and low tolerances for friction. It also confirmed that consumers desire higher levels of security without additional burden.
At-a-Glance: Top Findings from the 2019 Consumer Digital Identity Study
• The way Americans think about and prioritize their identities has shifted dramatically; they consider digital attributes such as their phone number and email address to be a greater part of their identities than family information or where they work. Fifty-one percent of consumers identified their mobile phone number as a key part of their identities, a 21% increase over last year.
• The one-click simplicity of mobile has conditioned consumers for instant gratification. Businesses need to make changes if they want to exceed customer expectations and reduce abandonment. Friction, which includes the number of steps or effort required to execute a command, remains one of the biggest barriers between consumers and businesses. In the past year, 83 million Americans abandoned account signup due to friction.
• 50 million American consumers (20% of all online adults) registered for new accounts exclusively on a mobile phone, up from 10% last year. Conversely, 18% of online adults registered for new accounts exclusively on a desktop computer, a significant decrease from 26% last year.
• Consumer preference for using mobile devices exclusively creates new obstacles for account opening. Less than half of consumers (43%) reported that the account signup processes they experienced on their smartphones were “extremely” or “very” easy.
Study Reports: The Identity Verification Status Quo is No Longer Acceptable
Consumers who spent the last few years watching numerous data breaches unfold on the news are continuing to lose trust in the ability of businesses to protect their identities. Over the past year, the number of Americans who feel it’s their responsibility to protect their own personal information increased by 15%, a dramatic year-over-year shift.
Many consumers are taking action to protect themselves. Of those who were notified their data had been breached, 60% changed their account passwords, 38% had their card reissued and 32% turned on two-factor authentication. Despite declining trust, or perhaps because of it, consumers expect companies to do more. Seventy-eight percent (78%) of Americans strongly believe that organizations need to protect their information, a 16% increase over last year.
The importance of trust has real implications for organizations. This year, more than two-thirds of Americans (71%) stated knowing that a financial institution was using better, more advanced identity verification methods would positively affect their decision to do business with that institution. This is a dramatic 27% increase over last year when only 56% of Americans felt the same way.
This clearly demonstrates that the status quo is no longer acceptable. Identity verification is important to consumers, but it can’t just be marketed. Instead, identity verification and fraud prevention should to be defined as a differentiator. Companies that do so are best positioned to capture additional customers and revenue.
The Mobile Future
The mobile future is now. Across industries, companies increasingly interact with mobile-first and mobile-only consumers who demand better security without added friction. Streamlining processes as much as possible, while introducing the right amount of friction at the right time, can fulfill the need for identity verification without driving away customers.
Preventing friction during mobile account signup requires dynamic escalation methods that can be used only when needed. Employing a multi-layered approach to identity proofing and offering the right amount of friction at the right time can elevate customer trust, facilitate onboarding, increase business identity assurance and shut down fraud.