The digital shift that occurred during the early days of the pandemic due to many consumers employing digital channels to complete routine shopping tasks brought a new focus on consumers’ perception of retailers and their trustworthiness. Retailers were not only judged by consumers on the usability of their websites and the availability of features such as inventory checks that saved shoppers time but also on their ability to protect and secure user data. The perception of data security — once an obscure component of consumer’s assessment of customer experience — is now a significant element in consumers’ view of their retail experiences.
Recent research shows that consumers’ perceptions of merchant trustworthiness determine the arc of their shopping behaviors, from sharing personal data to their choice of retailer. The Trust Quotient: How Merchant Trust Drives Shopping Behaviors, a collaboration with Sift, is based on a survey of 2,563 consumers and reveals that although more than 95 percent of today’s customers shop consistently with at least one merchant, they hold deep concerns over the handling of their data, even with merchants familiar to them.
Our study aimed to uncover the key drivers of consumer choice: what mattered most at checkout for consumers when they evaluated their customer experiences and why shoppers selected specific types of merchants to shop with and remain loyal to. The insights gained from the study showed that data security and merchant trust were elemental to the consumer’s choice of merchant and their sense of safety when shopping.
PYMNTS research revealed that the majority of consumers agreed with the statement, “merchants should do whatever it takes to protect my data,” even if it added friction to the checkout process. Consumer concern over data security varied by merchant size, with first-time shoppers at small merchants showing significantly more concern (84 percent) than first-time shoppers at larger merchants (75 percent) and repeat customers patronizing a familiar merchant (79 percent).
The si
gnificance of data security to consumers is undeniable. Concern over data security cuts across all income levels, with those earning over $100,000, between $50,000 and $100,000 and under $50,000 sharing nearly identical levels of interest in the safety of their data (80 percent, 79 percent and 79 percent, respectively) with merchants that they have shopped with before. Rates of interest in strong data security measures are highest for affluent customers shopping with small merchants for the first time (86 percent) and baby boomers (90 percent). Customers of all ages and incomes reported concern over data security at rates of more than 60 percent. An almost universal interest in strong data security is present throughout all demographic groups, yet among those who are not concerned with the security of their data, a sense of trust in the merchant or a past positive experience mitigates fears around data vulnerability.
Consumers who reported that they were not interested in extra security measures with merchants cited retailer trustworthiness as among the top reasons for their sense of safety when shopping. This was true for first-time shoppers with large merchants (43 percent) and small merchants (33 percent) as well as with familiar merchants (45 percent). Customers of familiar merchants (20 percent), new large merchants (15 percent) and smaller merchants (9 percent) also cited having “good experience with the merchant” as a top reason why they did not require additional security measures.
Our study also found that most consumers patronized had at least one
mer
chant whom they repeatedly patronized (95 percent). The levels of engagement, however, varied by retail brand with respect to leading brands. Customers making purchases online at least once per week were more likely to be patrons of Walmart (43 percent) or Target (42 percent) shoppers than Amazon customers (33 percent). New Walmart customers were the most likely of all new customers to shop weekly (40 percent).
Most consumers are loyal customers of at least one merchant, highly concerned with data security and open to shopping with new merchants. Emergent, smaller merchants seeking to attract and engage new consumers may be able to improve their prospects of doing so by signaling trustworthiness through the provision of new data security features.
Download the study to learn more.