Why Are So Many Of Your Customers Choosing Guest Checkout?
The rise of mobile e-commerce means too many customers are choosing guest checkout — and you miss out on key revenue and marketing opportunities. What’s to be done?
A few weeks ago, I was speaking to the Product Owner of a large online platform business, and his experience shows just how the world of online retail has changed. His business is an industry leader in a multi-billion-dollar sector, and over the last two years they have seen a dramatic transition in the way that customers choose to check out.
Originally, the business’s traffic was entirely desktop-based, but now 95% of their transactions take place on a mobile device. As a result, over 80% of their customers no longer register for an account; they simply check out as a guest.
The impact of rising guest checkouts for businesses and consumers
The overwhelming preference for guest checkout is a big problem for both retailers and their customers. Without the certainty of a signed-up customer, you miss out on valuable data and marketing opportunities, and your customers miss out on the streamlined purchasing and loyalty benefits that come from having an account.
Here’s a summary of the typical pros and cons of each option (from the viewpoint of a mobile customer):
Why mobile users prefer guest checkout
It’s not hard to understand why mobile users don’t want to sign up. Even though retailers have tried to adjust to mobile — by making websites responsive, or offering native apps — most platforms still default to email + password for account signup.
For a mobile user, it’s no fun to type a long email address into a small mobile screen. It takes too long, and it’s too easy to make mistakes. The real killer, though, is the password and authentication step.
Customers know by now that for security reasons, they should be using long, strong passwords that are different each time. But by now, most have ‘account fatigue’ — they already have too many passwords to remember, and they don’t want to create yet another.
Having to wait for an SMS or email and retype the PIN code to confirm their identity is even worse — it just takes too long and creates too much inconvenience. Inevitably, given the choice, most mobile customers don’t bother to go through that password step, choosing to simply check out as a guest — I know I usually do.
This leads to a result that satisfies nobody: the retailer misses out on the marketing and customer loyalty benefits, and the customers miss the ease of repeat purchases and the loyalty benefits of an account. But as long as the mobile signup process takes this much work, this pattern won’t change.
A game-changing passwordless alternative on mobile
The solution is simple: take advantage of the identity that customers are already holding in their hands — the mobile phone. You can now use the mobile number instead of an email address to identify customers in tandem with the SIM card in the mobile phone as the security check (a much stronger ‘possession factor’ than a vulnerable password).
The result is a frictionless, near-magical experience for your customers, combined with far greater security than the traditional password + SMS combination. It’s a new, game-changing approach, and it’s made possible using SIM-based authentication, a new technology which verifies the mobile phone silently, without the need for an SMS.
It makes for a very easy, one-step process for the customer, who will no longer need to resort to guest checkout because they can immediately create an account without having to type or memorise details, or wait for codes to arrive. Marketing communication can take place by SMS (which is actually more effective than email) and at a later point the customer can also add an email address if they choose.
And for your business, it’s a serious competitive advantage — when other services are still asking users to retype endless personal information, frictionless signup is an attractive selling point to your target mobile customers.
