Consumers are buying less online because of concerns about identity theft and security, according to a report released last week by The Conference Board in New York.
More than 13 percent of all Internet users say they or a member of their household has already been a victim of identity theft, according to The Consumer Internet Barometer published by The Conference Board.
"We found that people are becoming much more concerned both about identity theft and about security issues regarding their personal information and that they are altering their behavior because of that," says Lynn Franco, director of The Conference Board's Consumer Research Center.
"Misplaced or stolen data from major financial service institutions such as Citigroup, Bank of America, and Wachovia, and this week's admitted mishandling of data by the credit card processing company CardSystems Solutions, have increased consumers' concerns about online security," she says in the statement.
The survey found that nearly 70 percent of consumers have installed additional security software on their PCs, and 41 percent say they're purchasing less online--a fact that has some pretty negative ramifications for e-tailers, including slowing the growth of e-commerce, Franco says.
What we had seen was that companies were issuing privacy statements and they were being a little bit more upfront about what security measures they were using, she says. "But now they are also going to have to make sure that if they outsource part of the work that those firms are also abiding by procedures and agreements."
The majority of online consumers, 54 percent, say they are more concerned today about the security of their personal information on the Internet than a year ago, while 42 percent say their level of concern has not changed, according to the survey. Only 4 percent say they are less concerned today than in the past.
The survey also found an age gap: 63 percent of Internet users who are age 55 and over claim that they are more apprehensive, while only 40 percent of consumers under age 35 are more concerned today.
"Younger consumers tend to be among the early adopters of technology, and the Internet is no exception," says David Stark, North American privacy officer for TNS NFO, a division of London-based market research firm TNS. "This group is familiar and comfortable with the Web, and many feel that they know how to protect themselves online."
He notes that older online shoppers may have more at stake in case of identity theft. "Consumers who are 55 and older have accumulated more wealth than their younger counterparts," Stark says. "There is a lot more money at stake for this group if their personal information ever got into the hands of cybercriminals."
This story, "Consumers Growing Wary of Buying Online" was originally published by Computerworld.