Online Privacy Worry Erodes Trust in E-Commerce

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Traditional retailers may have a defense against complete decimation of their businesses. There is an increasing fear that use of e-commerce exposes people’s online security and privacy. In a new global survey, nearly half of those questioned say their anxiety about privacy keeps them from the use of e-commerce.

According to a study put together by Ipsos and the Centre for International Governance Innovation (CIGI), in collaboration with the United Nations Conference on Trade and Development (UNCTAD) and the Internet Society, 49% “say lack of trust is their main reason for not shopping online.”

In a comment about the results, Sally Wentworth, Vice President of Global Policy for the Internet Society, said:

Nearly 50 percent of Internet users surveyed do not trust the Internet and this lack of trust is affecting the way they use it. The findings of this year’s CIGI-Ipsos survey underscore the importance of taking action now to build stronger online trust by addressing users’ concerns and using technologies such as encryption to secure communications.

The survey of 24,225 internet users in 24 countries was taken between December 23, 2016, and March 21, 2017. The countries included were Australia, Brazil, Canada, China, Egypt, France, Germany, Hong Kong (China), India, Indonesia, Italy, Japan, Kenya, Mexico, Nigeria, Pakistan, Poland, Republic of Korea, South Africa, Sweden, Tunisia, Turkey, United Kingdom and the United States.

User anxiety came primarily from three sources: “cybercriminals (82%), Internet companies (74%) and governments (65%).”

Another hurdle e-commerce companies face, according to the research, is that many people will not use online payment systems. As internet shopping moves rapidly to smartphones and away from laptops and PCs, this could become a difficult hurdle. For e-commerce companies that do business in major developed countries, the problem is particularly acute. Among all the people surveyed across the 24 countries, 57% of people said they were likely to use mobile payment systems. This dropped to 44% in the United States, 35% in the United Kingdom, 29% in Japan and 27% in Germany. The only very large nation by GDP where the use of mobile payments was high was China, at 86%.

The erosion of brick-and-mortar retail may not be stopped by anything the companies in the sector can do. However, they may find mistrust in the internet is what comes to their rescue.