Survey: Consumers Trust Online Merchants and Payment Providers More Than Real-Life Ones

Today Cisco has published results of a survey that the company conducted to see customers’ attitude towards different shopping and payment trends - both online and offline. Cisco surveyed more than 1,500 people to see their opinions on various factors in the changing commerce landscape and the results are definitely worth noting - both for real-life financial institutions like banks and for e-commerce companies.

The main result of the survey is that people in all age groups tend to increasingly trust various online purchase and payment processing solutions with baby boomers even trusting alternative payment providers more than traditional banks.

The reason for this behavior is unexpected yet simple - people spend increasingly more time online doing all type of things, including purchases and payments. Thus they are growing accustomed to ease of use and flexibility of online services and expect the same from retailers and banks but frequently such expectations are not realistic. So we see a rather paradoxical situation where trust becomes an equivalent of convenience where a thing that is comfortable and easy to use becomes trustworthy at the same time.

First of all, this attitude is true for online shopping experience so when a comparison is made between online and offline shopping, many consumers are not happy with their offline experience. For example, 50% think checkout takes too long, 48% are disappointed to find out the items they want are not on stock and 46% simply can not find the products they are looking for.

To summarize this trend, I think it will be quite true to say that internet seems to be spoiling consumers and we tend to grow more picky when it comes to offline life as well since we expect the same level of service everywhere we get this service - be it on or offline. And this is true for both merchants and financial institutions so people expect to get the same level of service they can get from totally online service provider even when it comes to a real-life bank.

I have to admit that I myself still tend to banks more than any web-based services I use - simply because I remember perfectly well PayPal limiting access to my account for no apparent reason (I later found out that it was because I registered as a Russian citizen and resolution took a whole week) and also because I constantly receive notifications of failed login attempts to my MoneyBookers account - and both factors don’t make me feel 100 comfortable about online solutions, no matter how much I may want to trust everything web-based and hopefully reaching the state one day when I can do everything online completely. But when I make a decision on a new bank for myself or for a corporate account, the first thing I check is the quality of their online banking system and this will be a factor important enough to influence my decision along with other offline factors.

So I think there’s no denying to the fact that our online activities and our high expectations should influence the way traditional services develop by adding a level of control and convenience that will make them competitive against the online arrivals to the playing field.

It is obvious that Cisco is very much biased in this particular situation as it is well known as a provider of services and software to financial institutions. But the survey itself is very interesting and hopefully the results are still very indicative of the change that is taking place now. Ideally this survey (along with surveys banks can carry out with their own customers as well) is supposed to push banks and merchants to adopt more of the new technologies to please their customers better and offer them a level of service that will be similar to what they can get online.

Honestly, for me as a purchaser it is easier to place an order with an online store belonging to a well-known local retailer than with some e-store launched a week ago so probably this shows that I trust those same names I already know when I meet them online. But if such discoveries push them to adopt more advanced technologies to ensure online experience that is similar to what the best-known e-shops provide, I think it will only be beneficial to consumers.

You will find the full text of the executive summary of the survey here (PDF).

Photo by ralphbijker used under Creative Commons.