Frustration with cumbersome and repetitive authentication processes are overwhelmingly causing consumers to search for brands and digital experiences that securely unify and simplify identity verification, according to a new report by the Business Performance Innovation Network and CMO Council, entitled “Authentication Frustration. How Companies Lose Customers in The Digital Age.”
Based on a survey of 2,000 consumers across the United States, Canada, the United Kingdom and Ireland, the study finds that a huge majority of 81% prefer to do business with companies that do a better job of recognizing and verifying their identity “simply, quickly and safely.” More than 60% of respondents say they have abandoned business transactions due to authentication frustration.
Problems with passwords remain a major grievance of consumers, who say they strongly prefer physical biometric authentication methods, such as facial and fingerprint recognition. Almost 7 in 10 consumers (68%) say they have problems remembering and using passwords. Forty percent of respondents report using at least 11 passwords, including 23% who have 16 or more.
The report is part of a new initiative by the BPI Network and CMO Council, called “Unify How You Verify,” being conducted in partnership with Daon, a global leader in identity assurance technology. The thought leadership program explores the critical business need to simplify and unify the way companies recognize and authenticate their customers and partners across channels of engagement.
In addition to research into consumer attitudes toward current authentication processes, the initiative will include a further report based on interviews and interactions with senior executives and experts in identity management, security, customer support and ecommerce, on what can be done to improve customer experiences and drive greater revenue, satisfaction and compliance.
Password pain is hardly a new phenomenon. Yet it continues to be a persistent problem for consumers. Businesses and brands need to listen to what consumers are so clearly telling them. Simplifying and improving authentication will help gain customer loyalty and grow business. Businesses that fail to do so can expect greater customer churn and revenue losses.
“Data protection, privacy and identity theft are massive challenges for today’s digital business world,” says George Skaff, senior vice president of marketing at Daon. “The issue has become significantly more severe in recent months as consumers relied heavily on digital transactions throughout the COVID pandemic.” Daon enables companies to adopt an “Identity Continuity” model of authentication, in which biometric and non-biometric factors come together on a single platform to create a unified identity experience across the entire customer relationship lifecycle — from identity proofing and onboarding to authentication and recovery.
Market data shows that consumers have dramatically accelerated their use of digital channels and interactions during the pandemic. A recent study by McKinsey found that global business executives estimate their digital interactions with customers and partners have accelerated by some three to four years due to the pandemic.
Customer Attitudes to Authentication Process
Difficult authentication process:
| Reflects negatively on a company and its brand | 85% |
| Has a “major” or “significant” negative impact | 53% |
Financial services companies are a frequent source of authentication frustration. Consumers say the top areas where the encounter difficult identity experiences are:
| Digital devices | 43% |
| Banks | 37% |
| Credit & debit cards | 29% |
| Mobile payment services | 27% |
Most vexing problems with passwords:
| Keeping track of numerous passwords | 55% |
| Needing to re-create passwords | 43% |
| Being asked to strengthen passwords | 34% |
| Coming up with new passwords | 25% |
Consumers overwhelmingly prefer biometric authentication, including the use of voice, fingerprint, face, eyes, and behaviors.
| Believe authentication is “absolutely” an easier and better form of verification | 44% |
| Prefer to use biometrics as long as it is secure | 34% |
| Prefer passwords and other forms of authentication over biometrics | 10% |
Source: cmocouncil.org/thought-leadership/reports/authentication-frustration
Donovan Neale-May is the executive director of the CMO Council and BPI Network.
The Business Performance Innovation Network is a peer-driven thought leadership and professional networking organization reaching some 50,000 heads of IT transformation, change management, business re-engineering, process improvement, and strategic planning.
The Chief Marketing Officer Council is dedicated to high-level knowledge exchange, thought leadership and personal relationship building among senior corporate marketing leaders and brand decision-makers across a wide-range of global industries. The CMO Council’s 16,000+ members control more than $1 trillion in aggregated annual marketing expenditures and run complex, distributed marketing and sales operations worldwide.
Daon is an innovator in developing and deploying biometric authentication and identity assurance solutions worldwide. Daon has pioneered methods for securely and conveniently combining biometric and identity capabilities across multiple channels with large-scale deployments that span payments verification, digital banking, wealth, insurance, telcos, and securing borders and seamless travel.
Did You Know: More than 60% of respondents to the survey “Authentication Frustration. How Companies Lose Customers in The Digital Age,” by the Business Performance Innovation Network and CMO Council, say they have abandoned business transactions due to authentication frustration.
