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E-Commerce turns 21

Twenty-one years since Netscape launched the first SSL encryption software to help make electronic payments secure, we asked Phil Thomas, Senior Manager, Core Acquiring, e-Commerce and Emerging Payments at Lloyds Bank how the landscape has changed and how merchants can stay one step ahead.

“People would have been very surprised if you’d told them in the mid 1990s that they would be shopping or banking online. But consumer behaviour has changed enormously in that time, with technology transforming the way we work, live and transact. In particular, the past decade has seen rapid change. E-Commerce has moved beyond the preserve of the early adopters and today, for example, 72% of all UK adults purchase goods or services online whilst, according to a recent Ofcom study1, the average Briton spends over £2,000 a year online, 50% more than any other developed economy.

Digital is now becoming the channel of choice for a whole range of purchases, with more and more high street stores adopting an online presence and many businesses starting up purely as online entities.

Making online hassle free

Despite the evolution of technology 42% of businesses with an online presence don’t transact through their site2. Many businesses cite a lack of technical know-how or fear of hassle as a barrier. However, our research shows that 69% of businesses that are launching a website, want to enable a card offering3. That is why Lloyds Bank Cardnet is developing Lloyds Bank Cardnet Online Payments that integrates with a company’s own website, making it easy for a business to sell their goods or services online.

As well as providing a secure payment route, businesses wishing to make the most of e-Payment and e-Commerce technology must also ensure that their websites are in good overall shape. For example, terms and conditions should be clearly displayed and the website should be treated just as you would a physical store, ensuring products are shown and described in as much detail as possible. These improvements in website design have continued to evolve during the past decade.

Channel crossover

An increasing number of businesses no longer see their physical stores, websites and mobile apps as distinct. The development of technology that recognises when customers enter a store and pushes through discounts or other incentives via their mobile apps is just around the corner and will further narrow the gap between channels.

This is reflected in the amount of e-Commerce activity across the country, which is growing by about 12% every year4. With over half of the UK population owning a smartphone, it’s no surprise that sales via mobiles and tablets are increasing by over 100% annually.

Speed, convenience and security

For consumers, speed and convenience remain priorities in transacting online5. Merchants also seek convenience, but with more of a focus on offering seamless transactions backed by robust security.

Lloyds Bank Cardnet Online Payments, for example, will offer highly sophisticated anti-fraud measures that small businesses can utilise without subjecting their customers to numerous checks. In response to the rise in mobile commerce, we’re also ensuring our solution is optimised for mobiles, tablets and traditional channels.

Supporting new developments

Changes in regulation have also had to keep pace with technology to ensure customer and data security. The first credit cards simply weren’t designed for online use and regulation in the early years was playing catch up. Today, the storage of card data is regulated by the Payment Card Industry Data Security Standard (PCI DSS) to help maintain customer security, whilst initiatives are underway to standardise e-Commerce security across Europe. This will bring benefits to consumers, businesses and merchants and help support the continued growth in online trade.

We have learnt a lot since e-Commerce launched back in 1994. Lloyds Bank Cardnet and the industry as a whole understand the risks associated with transactions and continue to provide and update merchants with the support they need to keep them and their customers safe. We constantly monitor trends and offer a full service partnership to businesses selling online, developing and evolving our products and services in line with customer need, ensuring we can seize new opportunities in the next two decades and beyond”.

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4 Source: Interactive Media in Retail Group study 2013
5 Source: Interactive Media in Retail Group study 2013

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