Thursday , March 28, 2024

Checkout Proves To Be the Achilles Heel of Mobile Commerce

 

Mobile devices may be making it easier for consumers to shop anywhere online, any time, but high shopping-cart abandonment rates are preventing them from cashing in big on this new sales channel. A recent survey by payments-and-authentication- services provider Jumio Inc. reveals that two-thirds of respondents attempting to make a purchase using a mobile device failed to complete it due to difficulty with checkout.

Among the reasons cited for the cart abandonment is difficulty entering personal and credit card data and uncertainty about the Web site’s data security. Of the consumers who failed to complete an attempted purchase on their smart phone or tablet computer, 41% said the checkout was too difficult on their device and 23% said their purchase would not go through.

Additionally, many mobile shoppers are actually browsers who will put an item in a shopping cart to see shipping charges or test an online coupon to make sure it works and then leave the Web site, according to Mark Barach, chief marketing officer for Palo Alto, Calif.-based Jumio.

“Checkout on a mobile device can be clunky and difficult to complete for many mobile users and there are still a lot of mobile users that put an item in the shopping cart, go to checkout, and then leave because they are not ready to buy,” Barach tells Digital Transactions News. “Shopping-cart abandonment at checkout, however, is not a death blow for m-commerce, because mobile users are hooked on the ability to shop anywhere, any time with their device.”

To support his point, Barach says 68% of respondents have attempted to make a purchase using their mobile device. The survey, conducted by Harris Interactive in March, interviewed 2,130 consumers online, 1,261 of whom own a smart phone or tablet. Further, the majority of mobile users surveyed have attempted what he calls high-level transactions, such as checking a bank balance, transferring money between accounts, opening an account, and even applying for a loan.

“These are more complex transactions than a simple purchase, and that people are attempting them is an indication mobile users will continue to attempt future purchases after a negative experience,” he says. “The more success consumers have making any mobile transaction, the more likely they are to attempt other types of transactions.”

One of the key hurdles to clear in making mobile checkout more consumer-friendly is addressing concerns about data security. Fifty-one percent of respondents said they abandoned the purchase process because they did not feel comfortable entering their credit card data. Of this demographic, women were the most concerned about data security, with 56% saying they did not feel secure entering card information compared to 47% for men.

“Consumers’ concerns about data security are a weakness in the checkout process,” says Barach. “The goal is to get the checkout process to the point where repeat customers can be authenticated by entering a PIN and having their mobile device validated, and then their stored card and personal information is pulled from the cloud and securely downloaded to the merchant. This is the direction we see mobile checkout moving.”

Jumio's Netswipe application could be a step in that direction. The code for the app, which merchants integrate into their own mobile-shopping apps, allows shoppers to scan both sides of their credit card using the camera in their mobile device. The scanned image, which is encrypted, captures all the pertinent account information, the card’s hologram and other distinguishing features and then validates the authenticity of those features. Once approved, the consumer’s card data are automatically populated in the appropriate data fields on the checkout page. The technology, which can complete checkout in about five seconds compared to 60 seconds for manual data entry, can increase conversion rates by as much as 20%, Jumio claims.

Scanning a card also reduces the risk of fraud, as cybercrooks typically have possession of account numbers and cardholders’ names and addresses, as opposed to the actual cards.

“If the only option for payment is to present a physical card to be scanned, most criminals won’t be able to do it because they do not have possession of the card,” says Barach. “Checkout is the weak link in m-commerce and the less friction there is in the process and the more secure the process, the higher the conversion rate.”

 

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