Stored payment credentials are a driving force in eCommerce, and while most consumers are using stored credentials in some way, research shows that there’s an opportunity to further increase adoption of stored credentials if security is kept at the forefront.
Discussing the study “How We Pay Digitally: Stored Credentials Edition,” a PYMNTS and Amazon Web Services (AWS) collaboration, AWS Head of Payments Business and Market Development Mark Smith and Stripe Product Lead Josh Ackerman looked at the importance of stored payment credentials and how their proper use can improve sales and customer experience.
The survey of over 2,100 consumers found that 80% use stored credentials for some online transactions, with the most widely used options being storing credentials on merchants’ sites.
“Consumers care about and are going to optimize for what’s the fastest, most secure way to pay,” Ackerman said. “What we’ve seen is stored credentials and mobile wallets make those things incredibly easy and satisfy consumer needs.”
He called that a major missed opportunity.
“The net result is that there’s money being left on the table, and if you are a business who is not yet supporting a payment method like Apple Pay, Google Pay and these other express checkout options, it’s revenue that you could be earning and conversion points that you could be gaining,” he said.
This dovetails with the finding that good checkout experiences have been shown to affect 90% of decisions to return to a business.
“At Amazon, good checkout experience is in our DNA,” Smith said. “And at AWS, we are helping companies like Stripe ensure that they have the right data to make sure they’re creating a good customer experience, so that their customers, the merchants, are creating a good experience, and the end customers come back to them.”
Ackerman added that consumers care about a frictionless checkout experience, and once they’ve decided to make a purchase, a poor checkout experience may lead to a lost sale.
“You shouldn’t be losing consumers at that very last step,” he said. “What this means is that consumers shouldn’t have to hunt for what they need to make a successful purchase.”
He said it’s the businesses’ responsibility — and by extension, Stripe’s — to establish the right payment methods by having saved payment credentials, leveraging mobile wallets, “and using best practices when it comes to purchasing one-time goods or subscription goods. The nice thing is that a lot of those best practices and standards are becoming industry norms.”
“How We Pay Digitally: Stored Credentials Edition” found that security is the main reason that many shoppers continue to use manual entry of payment information.
“At Stripe, we’ve been partnering closely with AWS to make sure that there are high visibility ways that businesses can communicate to their consumers that their checkout flow is secure and trustworthy,” Ackerman said. “But the reality today is that there are so many missed opportunities.”
He supported that observation with three Stripe stats: 74% of businesses whose websites Stripe audited did not display security logos on their checkout page; 87% of businesses didn’t follow up with customers who had abandoned a cart; and 60% of businesses didn’t allow customers to save their payment methods for future use.
He added that stored credentials are a security feature “that would enable you as a business owner to see higher conversion if you offered that functionality.”
“I completely agree with Josh’s statement,” Smith said. “We always say security is job zero here at AWS. We all know that payment fraud is a bad experience for a customer. And AWS is providing the infrastructure and industry expertise for the payment and banking industry to develop solutions to deal with things like account takeover, credential stuffing and card testing.”
AWS encourages the use of scalable machine learning (ML) models, which Smith said are evaluated, deployed, trained and retrained in an ongoing way to create new rules and updated decision engines that combat fraud.
“From an AWS service lens, we are providing services to companies like Stripe that have the ability to protect sensitive data,” he said. “Services like AWS Nitro Enclaves to protect and process secure data; Amazon Macie, which uses [ML] to protect sensitive data; and AWS CloudHSM and AWS KMS for encryption and protecting the resources using encryption keys.”
Among the most interesting findings from “How We Pay Digitally: Stored Credentials Edition” is that a discount of as little as 5% to 10% will convert many stored credential “holdouts.”
That adds up for Ackerman and Smith, who said they have seen the impact of these incentives on stored credentials, as well as the positive consumer sentiment these incentives generate.
“All consumers want to make sure that they’re getting the best deal,” Ackerman said. “This metric isn’t surprising, but what is surprising is the number of sites that don’t offer this functionality at all. Even having as little as a 5% or 10% discount could make a big difference and could dramatically bump up your conversion rates at that final checkout moment.”
He added that consumers are far more likely to check out if they have a gift card that they can use.
“Even so, 35% of sites still don’t leverage gift cards at all,” he said. “Whether it’s a free trial, a gift card, a coupon or a promotion code for as little as 5% or 10%, these are key opportunities that you could use to boost that conversion.”
“From an industry perspective, I do think it’s money well spent,” Smith added. “If you think of how much it costs to acquire new customers for most merchants, a 5% or 10% discount seems reasonable.”
He said top-performing merchants “are the ones that recognize their customers, remember them, and provide them relevant offers and recommendations at the right time. Our experience is the merchants that are doing this well know how to leverage data combined with artificial intelligence and ML to better engage with customers.”