How an identity-first approach will secure the future of m-commerce

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The shift towards online shopping accelerated during the pandemic. And within that trend, shopping with smartphones, known as m-commerce, has been growing too. According to figures from eMarketer, in 2021, 38.5% of retail ecommerce sales were via mobile devices, and this is predicted to rise to 44.2% by 2025. But m-commerce has a problem. Smartphone shoppers are less confident about checkout than desktop internet users, so conversion rates are lower, making a more seamless and secure retail experience essential.

A 2019 Monetate study found that conversion rates for mobile shoppers stood at just 2.25%, which was less than half of the 4.81% recorded for desktop shoppers. What this implies is that shoppers may be willing to browse online shops on their smartphones but are much more comfortable making purchases on their desktop systems. Interestingly, a 2020 study by SaleCycle argued that the figures were reversed when it comes to adding products to a shopping cart, with 8.96% on mobile performing this action, whereas 4.35% on desktop did so.

In other words, customers are happy to browse online shops and select items on a mobile device but are clearly much more reluctant to complete the purchase. This is in stark contrast to the shift towards smartphones in other areas. Around two thirds of video viewing is on mobile, and a similar percentage of the population use smartphones for news consumption. In fact, more than half of all web traffic is now serving mobile devices, so their unpopularity for completing shopping transactions is a clear outlier, and ripe for improvement.

Some of this will be due to pure physical characteristics. While it might be attractive to browse online shops on your smartphone and select possibilities, a device with a larger screen will make it easier to make the final decision. But the most likely reason for the poor conversion rate of m-commerce is lack of confidence in the checkout process. A key factor in this is providing a trust-based, secure management of identity, which protects the user and makes them feel that their mobile transaction is perfectly safe, as well as seamless to perform. This can also make it even easier for customers to begin a transaction on one device that they then complete on another.

The benefits of CIAM

The central technology in making the m-commerce checkout process as seamless as possible is customer identity access management (CIAM). This important system enables organisations to securely capture and manage customer identity and profile data. It delivers control over customer access to applications and services. In the m-commerce context, this includes shopping carts, secure payment systems and subscription-based content. A strong CIAM infrastructure helps organisations avoid cyber breaches and enables customers to be confident that they can trust the systems they are accessing, as well as accelerating the building of new m-commerce experiences such as apps.

As our reliance on digital services has increased over the years – and accelerated during the pandemic – so has the focus on online activity as an area of concern for security. In 2020, identity theft in the US had doubled over the previous year according to the Federal Trade Commission, hitting 1,387,615 cases compared to 650,523 cases in 2019. The increased volume of transactions being performed in this way is seen as ripe for exploitation by fraudsters. The dangers involved are also becoming increasingly well publicised, leading to greater distrust from customers.

This means that there is no better time to ensure your organisation has a robust CIAM system in place. Okta provides a cloud-first identity platform to deliver the trust that organisations and customers need. The Okta Identity Network delivers a variety of different applications via the cloud to enhance customer experience. This enables features such as a Universal Directory to store identities and either two-factor or adaptive multi-factor authentication. Central to the platform is a single sign on that allows one login to provide trusted access to a range of applications. The last thing an online shopper wants is to have to remember a different set of credentials for every site they go to and every service they use. This tends to drive them to using one favourite shop all the time, creating a monopoly. Having one sign-on for multiple shops enables customers to spread their purchases around and enjoy a greater variety of options.

Okta can deliver its services either as an out-of-the-box add-on or via an API for companies that are looking to customise integration in a more bespoke fashion. Over 10,000 companies have already put their trust in Okta, and the Okta Integration Network has already provided over 7,000 integrations with third-party platforms, illustrating the wealth of domain experience available. Businesses will also benefit from the Okta Integration Network’s comprehensive consolidation of insights and reports. Companies can monitor logins and service access, as well as keeping an eye on failures, so that illicit attempts to use functions can be identified.

Security and data compliance are paramount to Okta’s suite of capabilities. The company’s services conform to ISO 27001, 27017 and 27018, as well as SOC2 Type 2, CSAR Star Level 2, Fed Ramp – Authority to Operate, APEC PRP and the all-important FIPS 140-2 and GDRP regulations. Having a CIAM partner that already comes with all these accreditations means an organisation won’t need to gain these itself, saving huge amounts of time, energy – and money.

The potential from m-commerce is clear. The smartphone in its current form is barely more than a decade old, yet it has become the de facto device for the majority of our personal digital interactions. It is ripe to become the de facto device for most online shopping transactions as well. By ensuring your business has a solid customer identity basis upon which to build its shopping experiences, you can secure the future of m-commerce for your company.

Learn more about Okta’s customer identity access management services


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