Increasing Online Sales by Increasing Trust: Part 2October 14th, 2009 | Uncategorized | 2 Comments »
This is the second part of a 2 part posting about increasing online sales by increasing trust.
As we discussed yesterday, the lack of trust is costing online retailers billions of dollars in lost revenue. Today we will talk about trust marks and the statistics that support the notion that online shoppers are more likely to purchase from a merchant that prominently displays a trust mark, and as a result, the display of a third party trust mark is one of the more effective solutions for building trust with a merchant’s prospective customer.
Market research has shown that third party trust marks alleviate the security concerns of online shoppers. A recent study investigated the security concerns of online shoppers and the value trust marks hold in the minds of consumers. The following statistics are from an August 2006 study conducted by TNS, an independent research firm:
The overwhelming majority of consumers feel it is important for sites to include a trust mark.
● 86% of U.S. online shoppers say it is important for an E-commerce site to include a trust mark of some kind on their site.
● 89% of online shoppers expect to see a trust mark displayed on a Web site’s home page. 85% also expect to see trust marks displayed on the page where personal information is entered and where the final transaction is completed.
● 65% of online consumers shop only at sites they know and trust, while 42% of online shoppers prefer to make purchases through sites that include a trust mark.
Shoppers not only recognize and value third party trust marks, but the presence of a trust mark can also persuade them to complete the purchase.
● 65% of online shoppers have terminated an online order because they did not “trust” the transaction. 53% of these shoppers indicate that the presence of a seal would have likely prevented the termination.
Finally, these concerns are translating into lost revenue for merchants. According to a survey of 10,000 households by the Conference Board in 2006, 41% of those households are purchasing less online than they did a year before. And with good reason, in 2005, identity theft cost consumers alone $680 million.
In a recent article published by eMarketer titled “Few Convert at Retail E-commerce Sites: Many Shop. Few Buy”, published on April 9, 2007, Jeffrey Grau, an eMarketer Senior Analyst, reported that online merchants convert an average of 2%-3% of their site visitors into buyers. However, he observed that retailers with industry-leading conversion rates are doing more than just looking at numbers. Mr. Grau adds that “online retailers who go beyond using traditional Web analytics data to truly understand their customers’ intentions, perceptions and concerns will be rewarded with higher conversion rates [i.e., increased sales].”
>It has been my experience, and as evidenced by some of the industry numbers provided above, that the lack of trust and the perception of insecurity are major inhibitors precluding online commerce from reaching its full potential. General concerns surrounding trust, security and performance affect all online merchants (large and small); however, smaller and lesser known merchants are plagued more so by these genuine consumer concerns. Accordingly, a merchant looking to increase their online sales should think long and hard about addressing the trust and security concerns of their customers by providing more of information that will help their prospective customers know that they [the merchant] can be trusted.
NOTE: If you are interested in reviewing the data sources for some of the numbers/statistics quoted in these postings, please send an email to firstname.lastname@example.org and we will be more than happy to provide the data sources.