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October 5, 2011

Consumers wary of new e-Commerce platforms: eMarketer

Over half of users who bought on something on social networking sites think social media storefronts aren't safe, finds study

By CBR Staff Writer

New security concerns over online buying and credit cards are growing among consumers, according to market research company eMarketer.

According to eMarketer 72% of all US internet users will have made at least one online purchase in 2011. The company said that in 2001, when consumers participating in USC Annenberg’s "Digital Future Project" were first asked about credit card safety when buying online, more than 70% were very or extremely concerned. Over the next nine years that figure dropped 37%, falling under the half-way mark for the first time in 2010.

Meanwhile, for most retailers online payment fraud rates have stayed the same or decreased from last year, said eMarketer. This was the case for over 75% of all retailers surveyed by Internet Retailer in August, with 67% — the largest group — having experienced a fraud rate of less than 1% in 2010.

However, new technologies have created new fears, said eMarketer. The company cited social networking sites as a place where people seem to be hesitant to make purchases.

eMarketer said, even though 20% of Internet users surveyed by the Ponemon Institute had bought something through Facebook, 51% did not think that social media storefronts were "committed to protecting them against fraudsters" and 23% were unsure.

The company said that consumers reported seemingly counterintuitive attitudes about the safety of tablets and smartphones vs. PCs and laptops, indicating a strong comfort level with mobile.

However, despite the relative newness of the mobile Web, close to one in three respondents believed fraud risk to be lower on mobile devices, and the 30% of total respondents who were very active online felt even safer; 39% of these so-called "elites" agreed with this notion.

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