Voice of the Industry

Mobile ecommerce, mobile wallets, and payment safety

Monday 23 September 2019 08:11 CET | Editor: Melisande Mual | Voice of the industry

Shaun Packiarajah, Former Researcher and Editor at Ecommerce Foundation, presents the importance of a trustmark for mobile commerce 

The idea of making a purchase from your phone is often second nature nowadays. That’s no surprise, with Visa estimating that 20 billion connected devices will be in action by 2020. Let’s dig a little deeper into how mobile commerce is looking currently.

The current mobile commerce landscape

One of the most significant shifts in the ecommerce world is mobile ecommerce. As mentioned before, the capabilities of mobile phones have improved as their importance in people’s everyday lives has increased. Mobile commerce accounted for 48% of ecommerce sales worldwide in 2017, with a forecast of 70% by 2022. Digital growth in retail is dominated by mobile, in terms of both raw growth in traffic (+24%) and orders (+37%).

When it comes to mobile ecommerce, merchants are also standing up and taking notice. In 2018, 17% of merchants saw half of their sales coming from the mobile channel. By 2020, this is expected to rise to one-third. An overwhelming 92% of merchants are currently or are planning to support the mobile channel in the near future – demonstrating the commitment to mobile payments.

However, when it comes to buying on a mobile device, it can still often be a headache. Multiple pages are put in front of the consumer before the order process is complete, many of them requiring time-consuming form-filling. All the convenience of a mobile device is lost at this crucial moment. That is where options such as mobile wallets have come into play. By enabling a payment experience that can be spread across multiple online stores, it can make things both simple and quick for consumers on-the-go.

The popularity of mobile wallets in particular can be demonstrated below by research from Fung Global Retail & Technology, with its global snapshot from 2017:

vspace=2

What security issues are holding consumers back?

The perception of security (and privacy)

New technologies are often difficult to grasp for consumers. But when new technology involves customers’ payment options, the hurdle is much higher. Fears around identity theft and hacking can have a chilling effect when it comes to adopting mobile ecommerce where the convenience of mobile payment can be most felt. This is where consumer education is crucial. Methods such as digital wallets utilise technology like encryption and tokenization to make payments safer than a traditional physical card. By communicating this effectively on their online store (or through alternative channels), consumers will both understand this point and be more used to it during their customer journey. Merchants are also wary about the security of new payment technology, according to research from Forrester.

Consumers often do not (and should not) understand the underlying security system at play when shopping online. They just want it to work and be secure. But there needs to be some perceptible ‘symbol’ or indication of this security for consumers to feel comfortable shopping online. With the exponential growth of ecommerce (especially new online stores), the consumer can’t base this on guess work.

The way forward: best practices

Tackle the remaining adoption barriers by looking past brand

Apart from trust and security, there are many issues that are holding consumers back from adopting mobile payments such as mobile wallets.

Convenience comes top of that list, with 45% of US users from a 2018 report finding it is simply easier to pay with a card. This is amplified by the fact that almost a quarter of individuals do not know where they could use a mobile wallet. Many of the most popular payment platforms are being tied to a physical device (Apple, Samsung) or have other restrictions. This can create a competing web of payment services, confusing consumers. Through innovation and possible cooperation, these leading brands can work to unify the experience from the consumer’s perspective – making the process of mobile ecommerce payments quick, easy, and hassle-free.

Keep devices secure

Many mobile methods are tied to a device. This can be both a blessing and a curse depending on the level of ‘cybersecurity hygiene’ a user is using. One perfect example is the digital wallets where many have the restriction that a mobile device needs a lock screen for it to function. Ideally, such a security feature should only be known by the account holder, but just as with a Netflix password, this is often shared with friends or can be obtained via unscrupulous means. Smart authentication methods such as biometrics and two-factor security can keep these issues to a minimum.

Gain consumer trust through a third-party trustmark

Mobile ecommerce is growing rapidly in many directions and consumer behaviour is changing just as rapidly. Cross-border trade means that consumers are exposed to websites from across the globe. In order to feel comfortable, consumers require a visible and simple indication of security. Ideally, this would be one that is familiar to them, no matter the country they are buying from. Trustmarks can provide this independent form of trust.

Making mobile ecommerce payments convenient and safe is the way forward

Buying online is increasingly a mobile activity. We want to shop on the train, waiting in line, or even in a store itself. By utilising easy and convenient payment options, ecommerce can not only grow faster but be safer as well.

This editorial was first published in our Payment Methods Report 2019 – Innovations in the Way We Pay, which provides a comprehensive overview of the up-to-the-minute trends, updates, and innovations in the payments space worldwide, depicting the key developments in the way people pay.

About Shaun Packiarajah

vspace=2Shaun, Former Researcher and Editor at Ecommerce Foundation, graduated with a Master’s degree in Victimology and Criminal Justice from the University of Tilburg. As part of the Research Team at the Ecommerce Foundation, he was involved in creating content and reports. His background is in public administration, policy creation, and statistical analysis. You can connect with him on LinkedIn.

About Ecommerce Foundation

vspace=2Ecommerce Foundation is an independent organisation with the mission to facilitate ecommerce through the development of practical knowledge, market insights, and services.

About Safe.Shop

vspace=2Safe.Shop is the Global Ecommerce Trustmark initiated by Ecommerce Foundation, helping online shops selling nationally and cross-border by creating consumer trust. Safe.Shop services include an ecommerce Global Code of Conduct certification, a Consumer Review System, and an automated Trust Score.

About Scamadviser

vspace=2Scamadviser.com helps over 2.5 million consumers every month to discover if a website is legitimate or a scam.

 


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Keywords: Ecommerce Foundation, Shaun Packiarajah, trustmark, cybersecurity, cross-border trade, mobile ecommerce, mobile wallets, payment safety, Visa, mobile payments
Categories: Payments & Commerce | Mobile Payments
Securing Transactions | Mobile Payments
Countries: World
This article is part of category

Payments & Commerce

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Securing Transactions