The new Experian Global Insights Report concludes that online spending will continue to gain strength even as consumers emerge from lockdown and return to in-person transactions. Consumers are also engaging with digital payments as much as they engage with email.
What were the findings of Experian’s study?
The growth curve of online spending has increased the use of mobile wallets that now rival traditional payment methods. The latest report shows that 62% of respondents say they are currently using mobile wallets, while 63% use traditional forms of payment.
Consumers stated that they want fast, frictionless, and secure transactions, with 81% saying that a positive digital experience makes them think more highly of the brand versus a traditional brick and mortar experience. This trend is also favorable for businesses.
Spending culture and security
It shows that 53% of consumers have increased their spending and transactions on digital channels in the past three months, with 50% of respondents saying it will likely increase over the next three months. David Bernard, Experian’s EVP of Strategy and Operations for Global Decision Analytics, speaks on the trends shown in the report relating to the pandemic.
“Results show that many consumers are more concerned about the security of their online activities than they were a year ago, with regional differences in the nature of their primary concerns. The past two years have given way to a digitally savvy consumer, who have an awareness and understanding of advanced, frictionless security methods,” said Bernard.
“Consumers seek to make their work and lives easier and safer.”
Preference and BNPL
The report also clarifies that consumers have a preference when establishing new accounts, with banking websites, retail, and credit card company mobile apps leading the way.
Digital savvy consumers place the most trust with payment service providers, credit card companies, technology, and streaming media companies. One additional business benefit with the rise and reach of new payment methods like mobile wallets, P2P, and Buy Now Pay Later (BNPL) is that businesses are also able to find options for better financial inclusion.
In the U.S. and U.K., 60% say they are doing just that with programs like BNPL. In the U.S., 4 in 5 consumers use BNPL to avoid credit card debt, whereas 7 in 10 U.K. consumers said the same. 57% of respondents say that BNPL could replace their traditional payment method.
Are consumers satisfied with digital payments?
Companies still have room to improve meeting customers’ expectations of the digital experience. 23% of consumers surveyed say their expectations for the digital experience have only somewhat or not at all been met. This percentage is down from 30% in Q4 2021.
23% of consumers feel very confident that the businesses will address their online security concerns. The tide has also changed as 73% of consumers put the onus on companies to protect them online. Consumers surveyed are also more aware of the value of their data.
90% of customers want complete or some control of how their data is used, with 57% being willing to share data if it ensures greater security or prevents fraud. There are regional differences for security concern. For instance, identity theft and stolen credit card information far outpace other worries in the U.S, while data privacy is a top concern in China.
More than 50% of respondents are worried about deep fake fraud in Malaysia and Peru.
Additional findings from the report include:
- 52% are concerned about their online transaction security.
- 42% are more concerned about their online security in the past 12 months
- 63% say they’ll share their personal data for value, up from 51% from 2021
Experian surveyed 6,000 consumers and 2,000 businesses across 20 countries, including Australia, Brazil, Chile, China, Columbia, Denmark, Germany, India, Indonesia, Ireland, Italy, Malaysia, Netherlands, Norway, Peru, Singapore, South Africa, Spain, UK and US, on insights related to consumer and economic outlooks, financial well-being, online behavior and more.
This report is the latest study in a series exploring the significant shifts in consumer digital preferences and business strategy over the past seven years. Download the latest Global Insights Report to learn about more findings from Experian Decision Analytics.