When the recent string of credit card breaches at major retailers like Target and Home Depot, consumers have become more hesitant to shop online. If these retail giants are being hacked, what is preventing more information from being stolen from smaller online companies?
With 1 in every 5 small businesses falling victim to fraud each year, it is more important than ever to implement more security measures to ensure your customers are safe.
Let’s Look at the Numbers
Last September, the Nielsen Company released their Global eCommerce Report, which broke down the habits of online shoppers. They found that 37% of US consumers do not trust retailers with their credit card information and that globally, 29% of consumers do not trust retailers to protect them from fraud.
ACI Worldwide conducted a survey finding that over 55% of shoppers feel companies do not adequately protect their financial information.
These numbers may not seem very significant, but once a retailer has been breached, their chance of recovering is slim. Of the 1 in 5 businesses who are victims of fraud, 60 of them will close within six months. Why? It’s because news travels fast.
85% of affected consumers will tell their friends, social media followers, and other consumers through the company’s page about the event, in which 88% of those informed will use that as a determining factor when shopping.
Without a trusted reputation, you’ll struggle to make the sale.
Security Makes Your Site More Appealing
An eCommerce site needs stable traffic to entice potential shoppers and improve conversion rates. With the multitude of eCommerce sites consumers can choose, retailers must find a way to stand out.
Site design is the most popular appeal factor used to attract shoppers, but if you have crummy security, the design is worthless. The majority of reluctance with online shopping dwells from the security level of the site.
Consumers are nervous about the security risk of the internet, so your site needs to be able to reduce their anxiety.
So how do you lessen the consumers’ hesitancy with a secured design?
You provide a robust website with safer and stronger security measures that they can see. There are multiple ways to do that. You can add an SSL (secured socket layer) to your site, which protect information using encryption or a trust badge, which will display on your site for consumers to see. Not only will that provide reassurance to consumers, but it will also stand out among sites without them as shoppers tend to notice when a site has none.
You can also require passwords to have particular characteristic and expiration dates. More than 60% of eCommerce sites do not have adequate password restrictions in place as well as do not provide guidance in developing a strong password.
Security Helps Your Bottom Line Shine
As mentioned before, a secured eCommerce site increases the trust consumers have with your brand. Increased trust leads to an improved conversion rate and a better ROI. ConversionIQ found that displaying a trust badge increased conversation rates by 11% as well as found that traffic generated by paid search channels saw a 52% increase in sales.
Ecommerce security also helps to decrease a site’s shopping cart abandonment rate. Shopping cart abandonment is when a potential buyer adds items to their cart, but doesn’t complete the order. The average site abandonment rate is between 50% and 75%, but without proper security measures in place, a site can experience a 95% rate.
In addition to cart abandonment, shoppers who trust your site to secure their information are more likely to make larger than average purchases. Secured site also have a higher likelihood of developing return buyers.
In the end, to be a successful online retailer, you must have a secured eCommerce solution in place. As hackers become more sophisticated, so should the security on your site.
For a more in depth look at how today’s security and other technologies affect retail businesses, check out our Technology Issues Facing Retail Businesses blog.