Security

Online shoppers are losing trust in e-commerce, study finds

According to a global survey from the Centre for International Governance Innovation, almost half of all respondents say they don't trust online shopping.

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Image: iStockphoto/grapestock

Users are losing trust in the internet, at least when it comes to online shopping and e-commerce. According to the results of a survey, released on Monday, 49% of people said they are increasingly concerned about their privacy online, and lack of trust is the main issue keeping them from shopping online.

The survey, conducted 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, could suggest that trust is keeping the digital economy from growing, a press release said.

"The lifeblood of the Internet is trust, and when that is damaged, the consequences for the digital economy are nearly irreparable," said Fen Osler Hampson, director of CIGI's Global Security and Politics program, in the release. "The results of this global survey offer a glimpse into why policymakers should be concerned, and why there is a strong link between user trust and the health of e-commerce."

SEE: Job description: Ecommerce tech analyst (Tech Pro Research)

The results of the survey coincided with UNCTAD E-Commerce Week in Geneva, Switzerland. According to the report, 82% of respondents were concerned about their privacy regarding cybercriminals, 74% were troubled by internet companies, and 65% were uneasy about potential governmental impact on their online privacy.

Organizations doing business online should take note of these insights and react accordingly. For starters, companies should be investing in cybersecurity solutions, and should be clearly explaining to customers how they are protecting their data from hackers. Because personal data is such a valuable commodity online, firms should also be transparent about how they are using (or not using) customer data, and whether or not they are making it available to government agencies.

The survey also noted that the lack of trust will impact organizations in certain regions more than others, the report said. E-commerce platforms in the Middle East, Africa, and Latin America will be more impacted by privacy concerns and trust issues, and companies operating there need to be aware of that.

"The survey confirms the importance of having adequate consumer protection and data protection in place, areas where many developing countries are lagging behind," Shamika N. Sirimanne, director of UNCTAD's Division on Technology and Logistics, said in the release. "More capacity-building is therefore urgently needed."

Expectations around payment processing also differ by region, the results noted. More than 86% of users in China, India, and Indonesia said they expect that they will make smartphone-based mobile payments within the next year. However, only 30% of users in France, Germany, and Japan said the same.

Additionally, even though they are shopping online, 55% of those surveyed said that they would prefer to buy items made in their own country, the report said.

The report surveyed 24,225 internet users across 24 countries. As online shopping and e-commerce continue to grow, customer privacy will need to be a top concern for businesses all over the world.

The 3 big takeaways for TechRepublic readers

  1. According to a new survey, 49% of internet users said they are concerned about online privacy, and that their lack of trust is keeping them from shopping online.
  2. People listed concerns over cybercriminals, internet companies themselves, and governments collecting customer data, meaning businesses should address these issues.
  3. Lack of trust in online organizations changes depending on the region, and user still prefer to buy goods and services from their own country.

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About Conner Forrest

Conner Forrest is a Senior Editor for TechRepublic. He covers enterprise technology and is interested in the convergence of tech and culture.

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