Wavering Consumer Confidence in Retailers Illustrates Need for Safer Payments

Retailers have come under the gun in recent months for lackluster data safeguards and primitive security measures at the point of sale. This has led to breaches at several big-name brick-and-mortar merchants, most notably Target. In the Target incident, cybercriminals stole more than 40 million credit and debit card numbers, which resulted in a massive 46 percent drop in profits for the retailer as customers lost their confidence in the merchant’s ability to secure their information.

As more breaches hit the news, consumers are losing more confidence in retailers. Other major retailers such as Neiman Marcus have also reported significant breaches affecting millions of shoppers. Even if the breaches don’t result in any fraudulent activity, as Neiman Marcus claimed, the numerous reports still affect purchase decisions.

Weak POS security may scare away customers
In fact, one recent study conducted by Software Advice found that some people are starting to avoid shopping at brick-and-mortar stores because of their security fears. Many customers are convinced that shopping online is safer than shopping at a physical store simply because of all the reported security breaches.

“Many consumers are more hesitant to swipe a card in person than online,” Craig Borowski, the managing editor at Software Advice, explained to Internet Retailer. “It seems now that the brick-and-mortar stores and traditional point-of-sale software need to catch up to the level of security seen on most online retail sites.”

According to the survey, three-quarters of respondents would be less likely or completely unwilling to shop with a company that allowed their data to be compromised. Conversely, a secure point-of-sale system has even become a selling point for some customers. More than half of respondents said they would likely (or even much more likely) shop at a store if they felt confident the retailer could keep their data safe.

Deploying the right tools to keep customers safe
Merchants need to consider their point-of-sale solutions and make the right upgrades to ensure the safety of their customers’ information. There are numerous tools and technologies that can bolster the encryption of credit and debit card data and make for a safer shopping experience overall. Whether retailers utilize mobile tablets, smartphones, electronic cash registers or PC-based point-of-sale solutions, it’s pivotal they keep their customers’ data secured.