2020 was a tough year, but we’ve moved on. Within a matter of weeks in 2020, the world has changed dramatically. Many businesses died overnight. But again, we live in an extremely competitive world; when one dies, others fill its niche instantly.
Despite all disasters, the population is growing, but we still stick to our lovely blue globe. Situations like the one we’ve witnessed the previous year became a new normal. Further, we move in time, the harder it will be to compete and survive as a business without a digital ecosystem.
How to Mitigate Risks in the Post-COVID Era?
The key point is the speed; every business must be fast despite any slowing factors – think fast, predict fast, adapt fast. It is hard to do that without innovations. The more automated the business processes, the faster to perform operations.
In the current world, the speed of operations, systematic approach in your business is everything.
Make sure you are digital. Any business without the digital presence and digital operations are already dead or soon will be dead. Your clients must be able to interact with you online as much as possible. They must understand your services without salesmen; they must be able to order any service without a single phone call.
But make sure your intranet is ready for it. Not all businesses use CRMs, not all have shared file storages, not all have knowledge bases. If you are one of those, be ready for big troubles. Your competitors have a great chance to overcome you.
Example of Striving Business
A good example here is the furniture factory that produces and distributes its own products. Without a good website, without an online furniture configurator, or any other digital product, what can it do when reseller stores are closed? Nothing, this type of business can silently wait until lockdown will be lifted and customers will come back again.
Let us open a secret; they won’t. Because of a financial crisis, they will seek cheaper solutions, and more automated businesses can offer them such an opportunity. Those businesses don’t spend money for sales representatives. They spend money toward digital solutions and highly effective personnel who do not spend working hours but are result-oriented and connected to real key indicators.
Fire all the ballast, it may sound a bit aggressive, but it is not. If you want to be fast, you cannot do this with a stone chained to your leg. Cut it as soon as possible, increase the speed, introduce KPIs and OKRs, and everything that cannot fit into those will self-destruct.
It may be a sleepy employee; it may be a service provider that feels confident in your partnership just because you’ve worked for 10 years together and doesn’t bring the required value at all.
There are so many opportunities around, you just need to open your mind for it. The crisis is a great test for every business, and you should completely understand how your business can strive in a crisis. Any decision may lead to instant death; there is no time to support laziness and unproductive behaviors.
Check the supply chain. We don’t do everything in-house; even companies like Apple partner with Samsung to provide the best possible services and experiences for their own customers. Make sure the whole chain is stable enough to sustain lockdowns and economic challenges.
Try to prepare plans B and better C in advance, but if it is too complicated or impossible, support those in need.
If you have a great supplier, but it is a small business, make sure it can make it through. It can deliver great products and services for you, but if it dies, you can have a hole in your processes. Help it, support it, as much as you can. This will reinforce the partnership and will definitely solve near and far future problems.
What to Do?
In general, let’s highlight that speed is everything in our world. If something slows you down, it is a good time to say goodbye. Get rid of the unimportant things in your business operations. Instead, implement faster proceedings via digital solutions.
Eventually, you will see how your business not only survives but starts growing. It is relevant to any company, be it a startup, small business, medium-sized business, or huge enterprise corporation.
The more innovations each company implements, the better service we all will get, and the more productive we will be competing in each market.
After all, COVID-19 quarantine showed the necessity of digital solutions in any company. Whether it is huge enterprises or small businesses/start-ups, now every entity requires external and internal digital collaboration processes to be established.
What Is a Software Gap and How It Ruins Businesses?
Many companies already have pretty big infrastructures, others have very little software footprint, but they all unite one thing. It is the digital gap in many aspects of any business’s life.
Example of Software Gap
For example, a big car dealership may have many automation software, databases, accounting solutions, and so on. However, it is still not possible to make a full cycle totally remote or human-free operating.
The crisis showed that most automated companies dominate less automated and digitized companies.
So that very same car dealership business has a CRM and probably great salesmen ready to use any automation or remote software to sell even when we have distancing and stay-at-home orders.
But their website is quite old. It doesn’t have any configurators or any kind of interactivity (visartech dot com). So a user won’t even call them. Especially when there are competitors on the market with an online configurator, where clients can configure a car of their own dreams, buy it, and conduct the necessary proceedings through the website.
The well-known Volkswagen automaker company has created a People’s Car Project. It was meant to let any person design their “perfect car.” Guess how popular the website became? There were 33 million website hits and 119,000 ideas designed. Amazing, isn’t it?
What’s the Outcome?
When a website becomes one place for ordering, clarification, and paying, most definitely, the “old-style” dealership is gonna lose the battle. Their great salesmen will sit straight without phone calls and will never meet a plan.
This is what I call the software gap. They have a gap between clients and a car review process. Their potential clients are not able to simply see what they will get, and they will just swipe for the next dealership that has it.
As you can see, any company must avoid those gaps as much as they can. Even the smallest crack can ruin the business in matters of a month.
The Ecosystem Saves Business
It sounds terrifying, but only if you’re not doing anything. Many companies are already on their way to a digital transformation – they work on covering and re-thinking those gaps.
Logically, the only way to avoid any gaps is to build the Ecosystem.
It is natural because its main purpose is to glue all company’s processes and goods together.
Any ecosystem is consistent and self-sustainable. Even deadly wounded, it tries to find a way out by any available means.
Well-known Examples of Ecosystems
We all know that any well-implemented ecosystem sells. Usually, it includes more services and better integration between them than others. The most ostentatious examples are Apple and Google.
Both built amazing products, software, and hardware. Both of them have created amazing ecosystems that the rest of the world uses.
We all saw how Nokia lost its smartphone leader position when Apple presented its ecosystem. For users, it was amazing as all applications are in one place, no need to surf the web, download a calculator, etc.
What Are Your Next Steps?
The same rule applies to any other business. The already mentioned dealership desperately needs to build at least a simple digital ecosystem to sustain future problems and win the competition.
They should add a configurator, integrate it with the CRM, implement synchronization with the car manufacturer. It all helps to check the availability of the goods and order things automatically. As you can see, it looks like a small but lifesaving ecosystem.
Let’s go deeper into details. Usually, any business has a web page. Pretty rarely, there is a mobile app, and some kind of CRM to track sales and marketing activities.
At some point, business managers come to realize that all customer-business interactions must be automated and available online to prevent a possible gap. What do they do? Correct, they implement the digital ecosystem.
What Lies Behind the Digital Ecosystem?
The core of any digital ecosystem is a backend that holds the business logic. It is the brain of the whole infrastructure. Usually, the backend process allows us to input information and make some decisions.
For example, calculate your Credit Score based on the data received from third-party services like credit bureaus: Experian, TransUnion, and Equifax. Those organizations have their own servers and are able to respond with it.
Once you have a backend, you need some sort of a client, a web page, an application, or usually both. This is a kind of gateway for your customers and employees. It helps them to interact with your backend and other nodes of the digital ecosystem.
You may have numerous services or products with a bunch of backends and clients, but they must be connected to each other to avoid gaps.
Ecosystems for Small Businesses
Let’s try to model an ecosystem for a small business company.
For instance, the company sells ice cream. It has 2 shops and a delivery service.
Develop a Website for Your Ecosystem
In order to create an ecosystem for this business, we need to start with a website. It should have essential information about the product, contacts, and provide an ability to order takeaway or delivery directly on the web page. It is truly significant for your business.
But the website is just a client, so it cannot store any data persistently. All the information is available only during the session. In order to store all the data and process payments, a back-end solution is required. Besides that, we also need integration with delivery services. It helps to synchronize the data through web requests with a third-party service provider and return to the client with waiting time and a delivery price.
There are many third-party service providers that any business interacts with. Imagine how convenient it is to have a comprehensive connection with all of them. Just think about it; based on your sales data, a system can automatically order new ice cream from manufacturers. Or even build forecasts on which ice cream will be popular in the next few weeks according to weather conditions and tv-shows releases.
Build a Mobile App for Your Ecosystem
Even such a small ecosystem gives businesses some real advantages over their competitors. The system may be indefinitely upgraded with more services that meet the customers changing moods.
For example, mobile users prefer to use applications instead of mobile-friendly websites. It requires businesses to create mobile applications for iOS and Android and connect them to the backend. It leads to an increased presence and improved service for the customers.
Take Care Of Wearables
In certain cases, there is a need to create an application for smartwatches, so customers can see the delivery status and alerts right on their hands.
In collaboration, a new value is born. Having an idea to deliver ice cream together with flowers, and integration with a flower salon is essential. Here businesses can implement as many integrations as they need to fulfill the greatest demands of their customers.
All of these interactions are nearly impossible to achieve manually. Everything must be connected with each other and communicate clearly. This is the only way when customers can see the crucial information about their orders on their screens in a matter of seconds.
That’s exactly what lays the foundation for further growth. Such a business can scale up to satisfy the increasing demands of the highly competitive market.
Every business needs some sort of an ecosystem, simply to connect all business nodes together. The better ecosystem, the more effective the business itself.
With the right tools in your hands that you are easy to use, you’re stable and mistakes-free. This way, your business can stand out on the market and satisfy your most demanding customers’ needs.
Image Credit: ketut subiyanto; pexels; thank you!
The Future of Mobile Payments in a Post-COVID-19 World – ReadWrite
The payments sector has been remarkably dynamic for some years now: dizzying valuations, double-digit growth rates, and an ever-increasing speed of technology advancement on a scale barely experienced in any other industry. We have seen the coronavirus fully transform consumers’ shopping habits, drive retailers to the verge of bankruptcy, and shine a spotlight on the value of digital capabilities, all of which have served as an enormous catalyst in an already fast-moving payment industry.
The Future of Mobile Payments in a Post-COVID-19 World
Many people think that everything is now changed — but we have no reason to think that this new normal is here to stay. However, the changes will only advance further, with far-reaching implications on business strategy for players along the entire payments value chain.
Consumer payment methods are evolving at a rapid pace, reshaping payments all over the world.
This has been particularly evident during the COVID-19 pandemic, as transactions have gradually moved online as stores have been forced to close. Overall, the ways we pay are affected by our cultures, habits, innovations, and the technology available to us.
In the light of the COVID-19 pandemic, the digital payment industry is booming and fundamentally changing. The crisis has changed people’s views of payments and financial services, with cash use decreasing and contactless adoption promoted by several countries. This shift to a cashless society affects all aspects: retailers, merchants, consumers, governments, financial institutions, and service providers.
As per Market Research Future (MRFR), the global mobile payments market is anticipated to reach USD 3,300 billion at a CAGR of 32% from 2017 to 2023 (forecast period). In today’s market, the mobile payments market is predicted to have a high growth potential.
For day-to-day transactions, mobile payments are a cashless medium.
A technology that allows users to make instant cashless payments using their smartphones. According to the study, the significant driving factor for the mobile payments market is the technological advancements that are occurring in today’s world. The adoption of advanced technologies such as near field communications (NFC) is increasing its popularity.
NFC allows users to connect two electronic devices, such as smartphones, by simply bringing them close to each other. Furthermore, other driving factors include the ease of use, secure approach, speed, and offers associated with it.
According to the Worldpay Global Payments Study, the growth of mobile payments will continue to be the biggest factor in consumer payment in 2020, making shopping simpler than ever and already leading e-commerce payment preferences with 42% of spending in 2019—up from 36% in 2018.
Personalized Service for Customers
As we all know, in addition to innovation, the commerce and banking industries are working hard to have a plethora of payment methods that are customized based on the needs of the consumers, both online and in-store.
Will cash continue?
Although Deutsche Bank assumes that cash will continue, the next decade will see rapid growth in mobile payments, leading to a decrease in the use of plastic cards. Over the next five years, mobile payments are projected to account for two-fifths of in-store transactions in the United States, quadrupling the current amount.
Mobile payments, which range from retailer-specific applications to wallets provided by financial institutions, device manufacturers, and technology platforms, deliver convenience and protection to customers and businesses worldwide. In 2020 alone, over one billion shoppers used mobile payments.
Similar growth is anticipated in other developing countries; however, different countries will experience varying cash and plastic card shrinkage levels. In emerging markets, the impact can be felt much earlier. Many consumers in these countries are making the switch from cash to mobile payments without ever having used a plastic card.
Generation-Z – today’s children and young adults – would also have a huge effect on the future of payments.
This technology-savvy generation, born and brought up in a mobile-first world, accounts for nearly 26% of the global population. Learning how to navigate the world in the age of “fake news” and getting their digital lives bombarded with messages of dubious quality and authenticity, Gen-Z wants more personalization, better quality, and greater performance from businesses.
Brands that want to win over Gen-Z must also appeal to their digital, flexible, and mobile-focused payment preferences. The ubiquitous smartphone is quickly becoming the new wallet of choice for this generation. Many customers opt to store their favorite cards in their phones rather than carrying physical cards. This is causing major shifts in global point-of-sale payment acceptance, which has risen from 16% in 2018 to 22% in 2019.
China is the Market Leader in Digital Wallets
We can learn a lot about the future of payments (particularly during the pandemic) from developments in China, which is building a world-class mobile payment infrastructure. There, the value of online payments accounts for nearly three-quarters of GDP (71%), nearly double the proportion in 2012. Today, just under half of all in-store transactions in China are made using a mobile phone, far above levels seen in other developed markets (25% in Germany and 24% in the U.S.).
Mobile payments now account for 22% of global point-of-sale spend in 2019 and are predicted to account for nearly a third (30%) of customer payments over the next five years. The increasing share of mobile payments adoption will be driven primarily by the steady decline in the physical usage of credit cards, debit cards, and charge/deferred debit.
Impact of COVID-19 Pandemic
COVID-19 is projected to have a major impact on the mobile payments industry. Contactless payments are thought to be more hygienic and safer. This trend is being driven by players in the commerce ecosystem who claim that contactless transactions improve safety and health. Compared to pre-COVID-19 projections, global contactless adoption was expected to rise by 6% to 8%, with an additional 110 million contactless payment cards expected to be released in 2020.
Mastercard’s global transactional data
Furthermore, Mastercard’s global transaction data and market analysis show a substantial rise in the use of mobile payments. As per the poll results, the number of mobile payments at supermarkets, groceries, and pharmacies during the March 2020 lockdown as a proportion of all face-to-face card payments rose by 25% compared to the previous year.
It’s cleaner to use contactless — that’s evident
Mobile payments are now used by 79% of people worldwide and 91% in the Asia Pacific, citing protection and cleanliness. The data reinforces how people search for alternatives in stores, choosing a secure and fast tap to check out over dealing with cash, pens, and keypads.
Even now that the coronavirus pandemic is beginning to abate — contactless cards and mobile payments are increasing in the United States and Canada, according to the results of an April 2020 survey.
During the pandemic, almost one-third of US customers used mobile payments for the first time, and the majority intend to continue using mobile payments after COVID-19. Mobile payments in the United States are predicted to more than double between 2020 and 2024, and contactless card payments are also rising.
The COVID-19 pandemic has had a huge effect on our social and economic well-being. Nevertheless, it is also true that it has been one of the most powerful forces of global digitalization.
Digital payments, particularly mobile payments, have risen as a reliable way for businesses and enterprises to operate in the post-COVID-19 new normal.
After discussing the effect of COVID-19 on all payment industries, one thing is clear: if any company wants to survive the pandemic — and all of the other “things” that may come down on “human-existence-pipeline — it must use mobile payment methods.
All companies must provide their customers with easy, convenient, and socially distancing-friendly forms of payments.
Image Credit: tim doublas; pexels; thank you!
How Blockchain Is Being Used With Smart Buildings – ReadWrite
Whether you realize it or not, many of us live in buildings with some smart capacity. You probably have at least one smart device in your home.
With the smart device industry set to grow by $65 billion by 2024, the odds are, you’ll add more of these devices. The true potential of smart homes lies in the ability of smart devices to communicate together — and that’s where blockchain technology comes in.
How Blockchain is Being Used With Smart Buildings
On the surface, smart technologies make individual tasks easier, but the potential is much larger than that. A smart device is effectively a sensor able to collect significant amounts of data about everything, from your energy use to how well-stocked your fridge is.
Smart Technology Works Better in Swarms
On its own, this data is valuable; when combined with data from other devices, its usability becomes game-changing. A properly connected smart home would be able to automatically adjust the heating to your preferences while minimizing bills, ordering your favorite groceries, monitoring and adjusting energy usage, sending repair notifications if something breaks, and much more.
Internet of Things (IoT) technologies are already used extensively in supply chain management. They help efficiently manage products passed through multiple stakeholders and verify that products are what the label says they are.
Catching Slave Labor in Fishing Supply Chains
One example where smart technology has been useful is in tracking fishing supply chains. The World Wildlife Federation (WWF) has used IoT to track sustainable tuna fishing.
The Western and Central Pacific tuna trade is rife with illegal fisheries — and, in some cases, slave labor — because tracking is either done via an easily-forged paper trail or not at all. However, savvy consumers and brands are demanding more accountability from the tuna industry.
The WWF’s branches in New Zealand, Australia, and Fiji have combined forces with blockchain software studio ConsenSys to implement secure traceability and track to address the problem.
Radio-frequency identification (RFID) or QR codes capture information as a fish moves through the supply chain from the boat to grocers. Tracking information is automatically saved in blockchain, making it nearly impossible to forge.
Privacy and Compatibility Remain a Concern
Although smart technology has many uses in enterprise settings, it becomes a thornier prospect for individuals. IoT devices collect huge amounts of data which can reveal a lot about their owners. Additionally, they are often poorly secured, creating significant security challenges.
Most smart devices must run on centralized platforms controlled by major tech companies, notably Amazon and Google.
There have been significant privacy concerns about both companies due to their access to an extraordinary amount of personal data.
Amazon Alexa’s Vulnerabilities
Setting aside concerns about microphones, Amazon’s voice-activated assistant Alexa also presents other significant security concerns.
Although Amazon provides some privacy protections, with 100 – 200 million Alexa devices and over 100,000 skills already deployed, there is a significant concern about malicious developers taking advantage of security holes.
For example, developer names aren’t verified, allowing a malicious developer to stage a phishing attack posing as a different company. This risk is especially high with some skills that link to email, banking, or social media accounts.
After a skill has been approved and added to the marketplace, a malicious developer can change its coding without getting Amazon’s approval or notifying the customer. Many developers also have misleading privacy policies — or none at all, meaning that customers will have no idea how their personally identifiable information will be used.
Lack of Device Compatibility
The second challenge is compatibility. Early adopters are painfully familiar with the concept of device divorce, where two smart devices cannot speak with another. Part of the problem is that Amazon and Google are used as primary smart home controllers, and there isn’t a platform-agnostic solution widely available to most consumers.
Blockchain Technology is the Missing Piece of the Puzzle
Blockchain technologies are working to provide the solution to these challenges and others since they can enable P2P connections without the need for a centralized validator.
With blockchain, it would be possible to connect numerous smart devices without being forced to hand that data directly over to the device manufacturer, mitigating privacy and security concerns. It can also provide increased transparency over how data is used, helping users understand what data their smart home is collecting and what it’s used for.
Blockchain technology is also hardware agnostic. Thus, it would be possible for users to pair together devices from different manufacturers without worrying about compatibility.
IOTA’s Tangle vs. Traditional Blockchain
One of the best examples of this vision is the IoT-focused blockchain IOTA.
It is important to understand that we are not talking about financial blockchain technology like Bitcoin. Blockchains based on traditional Proof of Work (PoW), like Bitcoin, lack the speed and scalability necessary to process the millions of data points produced by smart devices.
Instead, we are looking at smart device-focused technologies, most notably IOTA. IOTA uses a Tangle specifically designed for data and value transfer.
Blockchains like Bitcoin are essentially long chains of blocks containing transactions. The Tangle, on the other hand, is constructed as a directed acyclic graph (DAG), which is a collection of vertices connected by edges.
IOTA’s implementation is designed in such a way that each new transaction (vertice) must approve two previous transactions when it enters the Tangle. This eliminates the need for Proof of Stake (PoS) or PoW consensus methods.
Because these transactions don’t require always-online validators, they are feeless and contain metadata that makes them suitable for micropayments and data transfer.
IOTA is interesting because the technology is more mature than many other IoT-focused blockchain solutions. The project has experienced past problems, but the roll-out of its improved Tangle has allowed it to secure some important partnerships, primarily in areas designed to improve transparency.
Properly Validating Smart Device Data Is The First Step
IOTA’s most important partnership for smart homes is undoubtedly Project Alvarium. The biggest challenge posed by IoT — and smart devices in general — is the sheer volume of data collected. The vastness of information makes assessing what data is trustworthy and useful difficult, especially in an automated environment.
To solve this problem, Dell and IOTA teamed up to create Project Alvarium, designed to provide a simple way to assess the trustworthiness of data gathered.
Project Alvarium’s system logs every datapoint as it travels across the system. Each interaction is given a trust rating, which is logged on the IOTA Tangle to prevent tampering. This provides a simple way to find problems or deliberate tampering within a network of data.
Blockchain Can Help Resolve Security Concerns About Smart Security
When smart home users are certain that they can trust the data being generated by their devices, it opens up a world of opportunities that could transform our daily lives.
The most immediate use of blockchain technology is in improving building security. The most high-profile problem is undoubtedly Amazon’s Ring. In late 2020, dozens of people sued Amazon over accusations that their Ring doorbells had been breached.
The breach enabled hackers to watch people inside their homes and talk to individuals in the house over the Ring speakers.
The Blockchain Difference
Blockchain has been shown to resolve both the problem of data breaches as well as hacking takeovers. Capturing a blockchain-powered device would require compromising the entire blockchain itself compromised.
But proper validation, such as that proposed by IOTA, allows malicious devices to be pruned from the network, significantly improving security.
Additionally, blockchain could enable consumers to understand how their data is being used, helping to make smart devices more privacy-focused.
Smart Building Management Solutions are Already Being Tested
The value of blockchain technology becomes even bigger at scale. One of the most impactful uses of IoT and blockchain technology is in building management. Whether for an apartment building or an office building, it’s often difficult to effectively manage a building’s heating, lighting, and security in a way that minimizes waste.
Example: How Blockchain Could Manage Heating Bills
In a traditional setting, most buildings are managed centrally. If there is a unified heating system, it is often controlled by the local administration. Although this system is more efficient than individually-heated buildings, there is significant room for human error. That’s because the system is not optimized to account for more efficient heating higher up in the building as heat rises.
A network of heating sensors could be used to automatically measure the temperature in each apartment or office in a building. If the different thermostats could communicate with each other, it should be possible to input all the data into a blockchain solution.
A scheme like this would allow the building operators to create a proper heat map of the building and understand the most efficient usage of energy. It would also enable residents to access the data and understand why the system works the way it does.
Theoretically, it could also enable a user to select a target temperature for their apartment by leveraging rising heat from lower apartments.
Solutions on the Horizon
This kind of project is already being tested. For example, Brickschain offers several products that minimize difficulties with building management and handover on sale. There are also an increasing number of studies looking at how blockchain can be positively implemented into the building management process.
The Future of IoT: Many-to-Many Marketplaces
When buildings are utilizing IoT devices and blockchains, a bigger opportunity opens up: decentralized marketplaces.
Currently, it can be difficult to get the best deal on energy or heating bills because it is a marketplace with many customers but only a few providers. Switching providers can be difficult and doesn’t guarantee a competitive rate.
However, with blockchain, it would be possible to change providers based on real-time pricing data. This setup would create a competitive many-to-many environment where many providers are looking to sell energy to many customers. The competition among providers would drive down energy prices and improve overall efficiency in energy markets.
Swedish District Heating Study
Sweden has conducted studies to investigate the utility of blockchain for a district heating market. The setup allows apartment blocks already utilizing blockchain to automatically select the most affordable provider at any given moment, minimizing bills without requiring micromanagement.
The same concept could be applied to many aspects of building management.
One interesting idea is the concept of decentralized governance. This type of network could empower tenants and apartment owners to vote on changes to their apartment block’s management proceedings.
For example, renters could vote in favor of using only green energy sources or for changes to living space regulations. Building administrators could then better understand their occupants’ needs and create a better living environment for all involved.
Blockchain Will be Needed to do IoT Correctly
Adoption of IoT and smart technologies will likely increase. Governments like the UK are already pushing hard on smart meters and many of us have already adopted some form of smart technology in our homes.
This rush to adopt new technology will undoubtedly come with significant scaling problems as well as security concerns and significant privacy issues.
Additionally, a market dominated by a handful of major tech companies like Amazon and Google could prove damaging to the consumer in the long term.
To counter these eventualities, we’ll need a platform-agnostic solution that allows a more diverse field of producers to create new IoT devices.
Blockchain technology still represents the best way to utilize IoT for everyone’s benefit. If solutions like IOTA are implemented into existing smart homes, then we could build a new decentralized marketplace that will give us better control of our data, while improving the efficiency of our homes.
Image Credit: pixabay; thank you!
Social Sign-on: Sure, it’s convenient. But is it really safe? – ReadWrite
Remembering passwords is always a hassle, especially when you have innumerable websites that require logging in to view or interact with their content. To make the process simpler (as little as a couple of clicks), webmasters worldwide have accepted and implemented social logins on their websites.
Social Sign-on: Sure, it’s convenient. But is it really safe?
So, what exactly is social login? How different is it compared to the traditional method of inputting your credentials such as username, email address and password manually? More importantly, is it safe enough for use on all kinds of browsing activities?
In this article, we answer all the above questions and more, helping you understand what social sign-on is, and what the disadvantages of this convenient method are.
The history of social logins
Social sign-on as a method of hassle-free authentication has been around for over a decade now. Back in the nascent days of the modern internet in 2008, Facebook launched Facebook Connect, a service aimed at simplifying registrations on websites.
Once webmasters enabled FB Connect on their websites, visitors to the site would no longer need to fill up lengthy registration forms to sign up for the website’s offerings.
All they needed to do was connect their existing Facebook account to the website, enabling direct access to the site with a click of a button.
In 2009 and 2010, Twitter and LinkedIn respectively enabled their users to socially login to other sites using their existing social network credentials.
Google+ followed suit in 2011, and although no longer active as Google+, it still supports social sign-on using a Google account.
While it all sounds very convenient, social sign-on has many drawbacks and challenges that impact both website visitors and website owners.
Social Sign-on: The challenges and disadvantages
The Trust Factor
Most internet users do not trust the websites they browse to store and utilize their personal information safely and responsibly. Often, website visitors are concerned about how the information they have shared will be used.
In a June 2020 survey conducted by Insider Intelligence, 32% of US Facebook users felt that they somewhat disagreed that the platform could keep their data and privacy secure.
People tend to be wary of the private information they share online; they often resort to uploading falsified or inaccurate information about themselves on social media.
Considering that these social media sites do not verify or vouch for the authenticity of their user’s information, this could be less than ideal for a website looking for accurate data while accepting new user registrations.
In 2019, Facebook released data that said that 16% of the accounts on its platform are fake/duplicate accounts created by individuals or companies. What’s more worrisome are the findings of the research team at NATO StratCom that suggest 95% of the reported fake accounts still continued to remain active, with no action taken by the social media website.
With no checks on the actual profile that’s being used to socially sign-on to your website, you could soon have an imposter, Donald Trump or Joe Biden signing up for your global warming newsletter or purchasing a bag of your freshly powdered Mexican coffee.
Not everyone’s social — nor on social
While we talk about social media, we need to understand that although it is a global phenomenon with an insanely large number (read 3.6 billion) of people using it, there is still a sizeable chunk (>50%) of the population that is not on social media.
Using a restrictive method, you risk alienating a section of society that could be your potential target audience.
Transfer of Power
Enabling social sign-on seems pretty enticing at first, considering it would cut down your authentication work significantly. But this very ‘benefit’ could end up costing you dearly, as you lose control over your visitors’ data to a third-party service provider, i.e., the social media network.
Should there be any downtime at the social media service’s end, your website visitors would be stranded, unable to login to your site or access their data?
Access Control Issues
Many internet access places tend to have controls in place when it comes to accessing social media. For example, corporate and educational networks generally block access to social websites. Certain countries like Iran, China, Syria, and North Korea have blanket bans on the most popular social websites.
Social sign-on still depends on an API call-back to the social networking site to authenticate the user. Thus, by having social sign-on set up on your website, visitors authenticating on your site through these networks would end up facing a website with broken functionality.
Social media accounts are often the target of several hacking and phishing attempts. Thus, if your user’s social media account is hacked, it could lead to their account on your site being compromised as a result.
A University of Maryland study revealed a hacking attempt every 39 seconds on average, affecting a third of Americans every year.
Hacked social accounts could have an adverse impact on your website as well, by performing activities that might eat up your server resources or corrupt your files, if your security is not up to the mark. Secure authentication is the need of the hour, and knowledge of the security practices will help solve these concerns.
Too much to choose
People use many social media websites, so keeping a single social login can be counterproductive. However, providing multiple methods to login could likely confuse or overwhelm your visitor, leading to lower conversion or sign-up rates.
Lesser data to work with
Using a social sign-on for your website would mean limited access to user data, especially email. Not every social media network allows websites to access the customer’s email address. For businesses that rely on customer information for lead generation, this would be a major deal-breaker.
Awareness of all the security practices and malpractices (sawolabs dotcom) will help educate users as well as the website owners.
If not social sign-on, then what?
All the above drawbacks would make webmasters question the efficacy of social sign-on. But then, is there a better alternative that does not include such shortcomings?
Say hello to passwordless authentication powered by SAWO Labs. A new-age solution designed to address all concerns of security, compatibility and functionality.
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