Digital by Default: How are we Facing Up to Building Trust with Today’s Customers?

The last year has been a crash course in digital engagement for both customers and businesses.

Join Onfido CEO Mike Tuchen and Okta Regional Chief Security Officer Ben King as they present exclusive joint research on how customer attitudes have changed over the past year. Five thousand respondents from the U.K., U.S., France, Germany and the Netherlands told us how they feel about digital access across a range of industries.

Join to learn:
  • How has COVID-19 changed consumers' relationship with digital identity?
  • What is the role of the branch versus online services in a post-COVID world?
  • What are users’ expectations of digital and omnichannel access?
  • How do users want to authenticate themselves?
  • What should businesses do to meet their customers' expectations online?
Transcription:

00:00:10:16 - 00:00:33:11
Mike Tuchen

Hello and welcome. Thank you all for joining us today. We'd like to talk about some of the implications of our accelerating move to the digital world, something that was mandated by COVID in the last 18 months. But it's a trend that's been going on for years. And so we asked a number of questions about how customers/consumers were dealing with that.

00:00:33:16 - 00:00:59:12
Mike Tuchen

I'm the CEO of Onfido, the digital identity company. And I'm here with Ben King from Okta.

00:01:01:03 - 00:01:25:05
Ben King

Thanks Mike. To introduce myself, my name is Ben King. I'm the regional chief security officer for the EMEA region at Okta. We’re the world's leading independent cloud identity provider. We are platform- and technology-agnostic. As such, we connect the right people to the right tech at the right time in the right context without trying to limit what people or organizations can achieve using the technology of their choice.

00:01:25:20 - 00:01:38:09
Ben King

As you can imagine, it’s been a busy time for the U.S. post-pandemic in a remote-first world. But it's now more important than ever to secure people, organizations and communities in the world we find ourselves in. So plenty to do and a real pleasure to be here today.

00:01:40:15 - 00:02:02:06
Mike Tuchen

The pandemic was a crash course for businesses in moving to digital. And for customers, we had to get used to living our lives as the physical world came to a screeching halt. … We just simply had to start doing things digitally that we'd never done before.

00:02:02:14 - 00:02:32:28
Mike Tuchen

And the same thing for businesses. If they didn't already have a digital program, they had to accelerate that or really start from scratch. And so to understand how that transition has worked and what customers are looking for now and going forward, we interviewed 5,000 customers in the U.S., in the U.K., in France, Germany, in the Netherlands, and asked a number of questions about how they can move to digital.

00:02:33:03 - 00:02:43:16
Mike Tuchen

Is it meeting their expectations? And what were areas that they were able to trust vendors? And what we're hearing is they're concerned. …

00:02:49:00 - 00:03:09:02
Ben King

This is exciting research. And here's the overarching finding we're going to drill into today: Customers increasingly trust online channels, brands and transactions. And this sounds quite simple, but has really big implications and makes sense intuitively as well from a macro level. We've had employees pushed into a remote world where they need to be trusted by their employers.

00:03:09:14 - 00:03:34:05
Ben King

We've had consumers pushed into remote consumption of goods and services needing to trust the brands they're interacting with. And with this shift has come a sustained change in behavior from consumers, and trust has followed. In fact, one in two customers feel more comfortable using online services than they did prepandemic. And I suspect there's plenty who are always comfortable and some who will never be.

00:03:34:20 - 00:04:12:29
Ben King

But for the majority, extended exposure to online consumption has led to familiarity and now increased trust. … We find 90% of consumers are comfortable accessing services online. The survey tells us this figure is roughly half: very comfortable and comfortable at 48% and 41% respectively, with 7% uncomfortable and 3% very uncomfortable. Now drilling into what makes this 10% uncomfortable with online experiences is what's of most interest to me.

00:04:13:11 - 00:04:37:16
Ben King

We've got two key takeaways here. Firstly, 61% have trust issues with their data and 38% are concerned with convenience. The time finding a physical interaction easier, less confusing or quicker as the case may be. Now as a security professional myself, I find the data concerns really interesting. It's often been said that trust arrives on a bicycle and leaves in a Ferrari.

00:04:38:09 - 00:05:00:28
Ben King

That's to say trust is very hard and slow to gain, but incredibly easy and fast to lose. Now, regarding data concerns from consumers, this also breaks down into two subsets. Firstly … can a company be trusted to not sell or misuse the consumer's data in a way that the consumer doesn't consent or agree to? And secondly, can a company be trusted to secure that and not

00:05:00:28 - 00:05:26:04
Ben King

lose it accidentally or inadvertently to the criminals as a result of a data breach or a security incident? These are the two fastest ways to lose trust … but they're also the two best ways to build and maintain trust if they're done right. Customers are demanding fast, frictionless interactions and experiences, but at the same time they want businesses to manage these experiences in an ethical and secure manner.

00:05:26:17 - 00:05:45:09
Ben King

So establishing digital trust is a balance of enough friction to create reassurance but not frustration by making identity the core of every interaction. Businesses can ensure smooth, secure privacy, preserving online experiences, and this in turn will drive customer trust and loyalty. Mike, any thoughts on this one beforehand?

00:05:46:24 - 00:06:19:25
Mike Tuchen

You know, it's interesting. That really mirrors some research that we did last year. That was for … the onboarding moment. And what we saw then was very similar: that 50% said that their trust in data was their most important concern. And so it's true really all across the digital life cycle that you really need to establish trust with the consumer, that you're going to keep their data secure and they're going to keep their data private.

00:06:19:25 - 00:06:44:17
Mike Tuchen

And treat it ethically. So I think that is a resounding finding. … But one of the next questions that we asked was, you know, although this move to online was born of necessity because [of] COVID, the big question is, is it here to stay? Did it accelerate this long-term trend?

00:06:44:17 - 00:07:05:07
Mike Tuchen

… What we found was that trust used to be associated with size and physical presence.

00:07:05:22 - 00:07:30:04
Mike Tuchen

And I think about going into the back, of course, there's the brand of the bank, but there are a lot of other physical cues that you would read to say, Would I trust this as a place to put my money? You look at the facade. You look at you when you walk in and you look at the size of the space. …

00:07:30:04 - 00:07:50:27
Mike Tuchen

And for all these things, you start to get a sense of, is this place safe? And of course, there are all the other queues established in … branches across … our country. So all of those things are things we look for, but most of them actually are meaningless in the digital world.

00:07:53:26 - 00:08:20:08
Ben King

Now take me back there, Mike. I spent 11 years in banking, and the branch experience is what it was all about. But trust and branch experience has been replaced by trust in brand experience, along with trust in security. A frictionless digital experience means more than an established bricks-and-mortar presence established in 1901 as you say. … Digitally native businesses and a competitive economy have squeezed profit margins, resulting in many organizations ditching physical spaces.

00:08:20:08 - 00:08:43:25
Ben King

As trust online grows this is the death of the High Street, as much publicized in the media, and as I'm sure most of us have unfortunately seen as we walk around, customers increasingly want fast or near-real-time access, which they don't get with a branch by service. So these branches are becoming increasingly redundant for so many transactions. …

00:08:43:25 - 00:08:52:25
Ben King

Trust, digital experience, is enough now to want to perform a range of account actions online. The digital experience really is the key differentiator now for most businesses.

00:08:54:02 - 00:09:24:24
Mike Tuchen

That really is a critical point, that the physical presence and any of the other attributes that have been critical over the last hundred years many of them don't translate. And there are some new capabilities. This trust and security and privacy and ethics and convenience and speed are the new keys to the realm going forward. So these are new capabilities that companies need to make sure they get and attributes that their brands need. …

00:09:25:21 - 00:09:50:15
Mike Tuchen

So we ask customers do they want to sign up for a new account online, or would they prefer to go back and do it in person? And not too surprisingly, across really every industry, they want to do it online. 50% in banking, 60% in health care, telemedicine, and 70% in the telco world. I will drill some more of this in just a second.

00:09:53:05 - 00:10:19:18
Mike Tuchen

But their expectations weren't just about starting the conversation, starting the relationship online. They want to be able to do ongoing transactions. So seven in 10 want to improve banking transactions online. 80% want to be able to exchange account details online, which if you think about it, not too surprisingly, you can now do it on your smartphone. Wherever you are, whenever you are.

00:10:19:18 - 00:10:42:25
Mike Tuchen

You don't need to go anywhere. You don't need to travel. You don't need to wait for opening hours. And so that convenience factor, it really is dramatic. And so the question then is if that's this overwhelming preference to do it online and take advantage of this convenience, then what does a good experience look like? What is when we talk about convenience, what does that mean?

00:10:47:04 - 00:11:19:22
Mike Tuchen

Not surprisingly, we talked about not traveling, not being limited by opening hours. Instant access is another one … being able to access your power online wherever you are and get it instantly. That's a critical new benefit. …

00:11:19:23 - 00:11:46:08
Mike Tuchen

We just talked about security and privacy and being in control of your data. And so now customers are saying they feel safer doing it online. They feel like they're better in control of their data online. So all of these new attributes, new capabilities that customers need to bring are starting to show up in the research as well.

00:11:49:15 - 00:12:19:16
Mike Tuchen

The question is, with that overwhelming support for doing things online, do they want to go back and start doing more in person? And the answer is, by and large, no. There's very little desire across most actors to go back and do things in the physical branches anymore. So in banking, 77% said no, they're very satisfied or satisfied to do it online.

00:12:20:00 - 00:12:52:11
Mike Tuchen

And that helps you with car rentals and telecommunications as well. To me, the one that was surprising here is health care at 69%. I mean, what's absolutely remarkable to me about that is, think about all the things that you need to do with health care. That you really need to do in person … all the things that are hard to do virtually.

00:12:53:04 - 00:13:27:03
Mike Tuchen

And yet customers really have this very strong preference to doing it online. So that to me was really eye-opening. But there's a caveat. The question really is how fast do they want it? The answer is pretty fast. For an initial opening, an onboarding or account-opening experience, the tipping point was 10 minutes: Two-thirds to 70% … want to do everything in less than 10 minutes.

00:13:27:24 - 00:13:49:07
Mike Tuchen

… The alternative that customers have been used to for many years has been if they have to go do it physically, in-person, almost immediately, they won't even get there in 10 minutes. …

00:13:49:15 - 00:14:09:23
Mike Tuchen

Now, I wouldn't be at all surprised if this starts to compress in the coming year because 10 minutes is OK now. … But to me, the bottom line is this timeliness is a real important benefit. The customers are really placing a lot of value [on it].

00:14:11:08 - 00:14:32:03
Ben King

Yes, this really resonates with me as well. Obviously, we're all consumers at the same time, and we're all patients from time to time. Personally, I'm surprised at 10 minutes. I would put this well below 10 minutes myself for a positive customer experience, but it might just be me being inherently impatient from the consumer's perspective.

00:14:32:14 - 00:14:55:16
Ben King

Trust with time is as important, if not more so, than trust in the data. That's what this survey data is telling us. That's something I disagree with personally as a security leader, but I really do understand the sentiment as the effects of a customer experience, whether they're seamless and superior or whether they have an atrocious experience or something that a customer is going to interact with regularly, frequently, all the time, it's going to impact them.

00:14:56:06 - 00:15:17:01
Ben King

Whereas the pain caused by a data breach or a security incident at a company is probably going to be a bigger impact to them, but happen much less frequently, hopefully every couple of years at the most. So as I'd say, in a risk world, it's a trade-off of impact versus likelihood. And it's not surprising when you think about it, that what impacts the customer the most is what they're doing every day.

00:15:18:22 - 00:15:45:23
Mike Tuchen

Right. I think that's right on. And I agree that for those of us techies, we were more patient than average and our expectations are far faster than this. But even for the broader consumer world when it came to doing ongoing things, so not just the initial experience, but doing ongoing transactions like approving a banking transaction, they want to do it in less than three minutes.

00:15:46:04 - 00:15:57:17
Mike Tuchen

So they're willing to put up with more time upfront to establish that relationship. But they really start to value that convenience and speed on an ongoing basis.

00:16:04:13 - 00:16:22:09
Ben King

Right. So this is really interesting stuff. So I want to delve into the next part of the research here. And the section is trust. Omnichannel experiences are now table stakes for organizations wanting to compete in the post-pandemic world. So let me explain. Next slide, please.

00:16:25:00 - 00:16:50:26
Ben King

What we're showing here is a chart of device usage by age group to enable customer experiences. Obviously, a range of devices for a range of people. Perhaps unsurprisingly, smartphone leads the way for use, and for many customers it's replaced with computer, whatever that is. In today's age, as age increases we've got some tablet preference as well. And no doubt we'll see a change in device categorizations in future as devices themselves evolve.

00:16:52:03 - 00:17:12:10
Ben King

This is useful if a target market for an organization is age defined or age aligned. But if not, and if customers are from multiple brackets here, what we need to know is that customers expect online businesses to provide access to services via their preferred channel. And this is an expectation they've become used to from many established brands in the online space

00:17:12:10 - 00:17:34:12
Ben King

today, Now, in fact, there's a survey question here to confirm that expectation. The research shows that nine out of 10 customers agree businesses should allow access by whatever channel suits their needs. And personally, I'm not sure what the remaining one out of 10 is thinking here. I guess that they've grown up in a world where they're used to not getting their way.

00:17:35:11 - 00:18:08:12
Ben King

The chart here again gives us a breakdown by age grouping for additional insight. … Businesses want to provide access across channels on multiple devices. It's a great ambition. Businesses are falling short of this, and that's for a few reasons. Either they're not enabling this access as demanded by customers in their preferred channel, or they're failing to deliver the experience consistently or seamlessly across channels.

00:18:12:23 - 00:18:44:05
Ben King

And here we've got a really interesting finding, possibly the most interesting for me. Seven out of 10 customers surveyed were blocked from accessing services during their digital experience in the last 12 months, and 23% reported they were being blocked with high frequency … whether it's in terms of processes on the digital channel or processes on the back end.

00:18:44:19 - 00:19:07:11
Ben King

Likewise, many consumers have individual identities often for multiple services or every service they use online. And this identity sprawl, either in the consumer space or on the organizational side, isn't optimal. [It] is the enemy of good experience. This approach doesn't scale, and as we transact more and more online, what we need is a robust digital identity.

00:19:07:11 - 00:19:23:06
Ben King

Ideally, a single digital identity, which is what we use as we process through the online experience. And this is to both secure our digital sales, but also to enable that seamless experience customers are demanding. Thoughts on this one, Mark?

00:19:24:11 - 00:19:44:22
Mike Tuchen

Yeah, clearly that dichotomy where you have 90% of customers saying they're happy would prefer to access services online, but 23% saying it's locked up. That's really the opportunity. That's what we need to fix to allow customers to have that seamless experience … that they also strongly value.

00:19:46:23 - 00:20:07:18
Ben King

Yeah, I totally agree. I would love to see that step personally by industry as well, because I think some industries do this well and some industries just are atrocious. You know, every time I need to call a telecommunications provider, I just have a terrible time. Here's the next terrific stat: 35% of customers feel they would find it difficult to access their bank if their device was missing.

00:20:08:00 - 00:20:32:09
Ben King

Let me break that down. One-third of customers feel tied to their device. The reasons being 54% are storing all their passwords on that device. 42% wouldn't know how else to access their account. And 24% are reliant on the device for facial recognition. This is not a good state of affairs. And it's destined to end badly sooner or later as that device is lost, misplaced or accidentally destroyed.

00:20:34:13 - 00:20:57:16
Ben King

The way around this is for organizations to adopt a zero-trust security approach where customers have to establish their identity regardless of device or password. Or any single factor. Zero-trust security dictates we use a variety of factors to strongly authenticate a user before they can access resources required. We can authenticate using something they know, the username and password, something they have, the device, the security key or token.

00:20:57:26 - 00:21:15:23
Ben King

That's something they are. This is the biometric answer, the facial recognition fingerprint. This means we can increase security, reduce friction, and we can do that using a combination of single-sign-on technology and MFA, multifactor. This removes the dependence on a single factor like a device when it's no longer convenient.

00:21:20:06 - 00:21:55:09
Ben King

Now, while I'm on the topic of zero trust, I wanted to quickly show this chart, which … details the rise of zero-trust security since the pandemic began. We've been doing this research for the last three years. As you can see, despite zero trust being debated as a prioritization concept … only 16% of organizations we surveyed had implemented or were planning to implement zero- trust initiatives in the next 12 months. Now in 2020 as the pandemic hit, obviously there was a change here. Our survey response rose to 40% of organizations implementing zero-trust strategies and in 2021 this has risen to 90%. That's to say 90% of organizations have landed on zero-trust security as their consensus solution to solve the security problems we face today.

00:22:25:22 - 00:22:45:11
Ben King

There's no doubt that identity is key to establishing both convenience and security of digital services. But how do consumers want to prove their identity? This comes back to the mix of factors I've been discussing and absolutely can be done in a password loss way, especially as we ramp up more secure, more modern factors like biometrics. Any thoughts on that one, Mark?

00:22:47:04 - 00:23:13:02
Mike Tuchen

We went and asked exactly those questions. When digital prices fall short, they're blocked from apps, services, how do they want to prove their identity? How do they want to know what message they want to use and what are they most comfortable with? And here's what they told us: Many customers experienced visual identity verification for the first time in the pandemic.

00:23:13:13 - 00:23:36:17
Mike Tuchen

90% said they would use a photo of their identities document again. And the way that works is very similar to what your companies are, what people have been doing for decades in the real world. Right. If you want to open up a bank account or rent a car or check into a hotel room, you pull out your wallet, pull out your identity

00:23:36:17 - 00:23:59:24
Mike Tuchen

card, and someone checks it for you. And now all of this stuff you can do online with a smartphone. And now it turns out the checking process is being done through AI and machine learning automatically. So a lot faster and a lot more accurately. But it's a process that everyone's familiar with from the real world. So it's not that surprising that they were comfortable with a simpler and more streamlined version of doing it online.

00:24:02:12 - 00:24:31:24
Mike Tuchen

But we also asked them how comfortable they were using biometrics. And it turns out that 57% have used more biometrics over the last year. And it's not too surprising, because for anyone that's used a modern smartphone, certainly one from Apple, that the way you unlock it these days is by using your face as a biometric. And now more and more apps in the App Store are looking into that.

00:24:31:25 - 00:25:03:21
Mike Tuchen

So logging into my bank account online, on my investing account, logging into my hotel reservation, now all of that stuff is now hooked into Apple's face ID. And so for all customers that are in that ecosystem, it's becoming a normal part of their everyday life. And they're increasingly comfortable with it so we asked them how they felt and they found biometrics convenient.

00:25:04:19 - 00:25:28:19
Mike Tuchen

Eight in 10 also found it secure. So when Ben was talking earlier about the importance of both security and convenience, it looks like biometrics are really scoring well on both of those. People find it convenient, simple. You don't have to remember anything for passwords. It’s fast and easy. And it's seen as very secure as well.

00:25:32:03 - 00:26:05:06
Mike Tuchen

And so we then asked them to compare it to other forms of authentication. And by and large, they preferred biometrics versus pretty much everything else, you know. 70% versus a password, for example, 60% versus using an ID credential. The ones that were most amazing to me, only 64% would prefer biometrics as opposed to taking documents to a branch.

00:26:05:24 - 00:26:32:24
Mike Tuchen

I mean, wow, why isn't that 100%? That one blew me away. … The other one … is 59% versus take your call from a call center. Remember those, where people ask you which of these addresses sound familiar? Which of these cards have you owned? All those questions which for me start getting more, lik, you say, how on earth would this company know this? About 59% said they preferred using biometrics.

00:26:32:24 - 00:26:53:01
Mike Tuchen

So I think to me the acceptance is impressive, about two-thirds across all different factors. But I'm actually surprised that it’s … not close to 100%. …

00:26:54:24 - 00:27:14:17
Ben King

Let me let me jump into these. I'll start on No. 1. The first one for me is if the last 18 months have taught us anything at all, it's that an organization's key differentiator is their digital offering now, not their online presence. Not bricks-and-mortar branches we were talking about earlier. Customers are increasingly trusting digital interactions to purchase goods and services.

00:27:14:17 - 00:27:27:02
Ben King

We've seen that from our research data today. The world is digital. And the takeaway for me is that organizations need to understand this shift, take advantage of this shift in an omnichannel, customer-centric way to ensure their

00:27:27:02 - 00:27:54:24
Mike Tuchen

success. And as we talked about, customers care about both convenience and security. And so we talked about the 10-minute break-point for the first experience and three minutes or less for ongoing experiences. So the key for everyone is to deliver secure, seamless, frictionless experiences. …

00:27:54:24 - 00:28:19:08
Ben King

The third one for me, there's a misconception. This is personal for me as a security leader. There's a misconception that security is the enemy of user experience. In fact, modern security frameworks can enhance security and also the user experience at the same time, like 90% of global organizations currently. I recommend considering tackling this approach with an identity- centric, zero-trust security strategy, investing where needed to pursue these outcomes.

00:28:19:10 - 00:28:28:18
Ben King

Absolutely. This can be password loss if that's the way you want to go. And password loss for me personally is a great goal to have. We should kill the password; it is all about convenience for the consumer.

00:28:31:07 - 00:29:00:05
Mike Tuchen

And finally, the last big takeaway we have is that biometrics are an increasingly trusted factor in establishing your visual identity and as part of an ongoing multifactor authentication. So I think the key takeaway for all of us is to use biometric authentication … as a convenient, secure factor. And it’s one of the pieces underpinning your zero-trust strategy And so with that, we'd like to thank all of you for joining us today.

00:29:01:01 - 00:29:10:22
Mike Tuchen

And thank you, Ben, for a great conversation. We look forward to doing a lot more together with you and the team in the coming months, years.

00:29:11:20 - 00:29:15:09
Ben King

Thank you, Mark. It's been a blast to share the stage with you.