Forter has released findings from its 2024 Consumer Trust Premium Report, which explores the evolving relationship between consumer shopping habits and brand trust, based on 2,000 survey respondents in the US and UK.
Coined the “Trust Premium,” the report reveals UK consumers surveyed are now willing to spend 48% more, on average, with retailers they trust – up from 44% in 2023.
Despite the impressive Trust Premium uplift, these consumers in the UK ranked their overall trust in online brands a 7/10 – down slightly from 8/10 in the 2023 Consumer Trust Premium Report.
“The digital experience impacts trust more than retailers may think, whether with complicated check-outs, unfriendly policies, or other Checkout friction,” says Michael Reitblat, CEO and co-founder, Forter.
“By treating their shoppers like people – instead of bots or bad actors – retailers can secure higher average order values and stronger customer lifetime value.”
Younger consumers struggle with easy online shopping
Despite their growing buying power, the report found younger UK consumers continue to face challenges shopping online.
54% of Gen Z[1] consumers surveyed in the UK have been wrongly declined in the last three months, compared to an average of 33% across all ages.
Gen Z shoppers are also more likely to suffer poor customer service, have their online loyalty points stolen and experience expensive or difficult returns policies.
Social Commerce Popularity Soars; Trust Isn’t Certain
Emerging shopping platforms, such as social commerce, are booming in popularity, especially among younger generations.
The report found that 89% of all UK respondents have made purchases through social media platforms such as Instagram and TikTok, compared to 99% of Gen Z.
However, 38% of respondents do not trust that their personal information is secure when making purchases on social commerce.
This poses an immediate challenge for retailers that must build consumer confidence to fully capitalise on the Trust Premium in social commerce.
The Hidden Cost of Friction
Many retailers use friction to validate good shoppers – and keep fraudsters at bay. But the report found that friction continues to cost retailers money at alarming rates.
More than three quarters (77%) of UK respondents say they are likely to abandon their purchase if the checkout process is too difficult or time-consuming, in line with last year’s findings.
In the last three months alone, almost one third (31%) have abandoned their shopping baskets due to a complicated checkout process, and more than one in five (22%) have done so because they were required to create an account.
In light of regulations such as PSD2, 60% of UK consumers surveyed say they have experienced additional verification methods such as one-time passcodes in the last three months, leading 18% to abandon their purchase.
Unfriendly Policies Cause Good Customers to Quit
Despite having a strong influence on where they shop, the report reveals that many returns and shipping policies do not meet customer expectations.
89% of UK respondents said a retailer’s returns policies are important when deciding where to shop, and 93% said shipping policies are a key factor.
However, 52% of consumers have abandoned a cart in the last three months due to high shipping fees and 22% have done so due to restrictive returns policies.
“Brands are future-proofing their businesses to thrive in an uncertain economic environment with unpredictable consumer behaviour,” concludes Reitblat.
“One of the biggest changes they can make is to invest in knowing who their good customers are so that they can deliver tailored experiences and build lifetime value through mutual trust.”
[1] Gen Z defined as respondents born between 1997-2005
The post Checkout friction and unfriendly policies are costing retailers appeared first on Payments Cards & Mobile.