Retail & ID Theft – III

Retail outfits in India are increasingly resorting to use of personal identification technologies to prevent fraudulent purchases by identity thieves. The idea behind such technologies is to ensure that consumers using credit/debit cards are genuine owners of these cards rather than thieves who may have somehow got hold of these cards. The experience of US retailers, however, show that consumers can put up resistance against the use of such technologies so that marketers in India should be aware of the concerns that customers have regarding the introduction and use of such technologies so that they can avoid any kind of consumer backlash due to the use of these technologies. This article focuses on latest research on consumer behavior with regard to use and introduction of such technologies.

Research on consumer behavior with regard to use of such technologies is still in its early stages and what follows is based on work that has been published very recently. Writing in the journal “Psychological Reports,”: Volume I, 2007, Thomas L. Ainscough, University of South Florida, St Petersburg, Richard G. Brody, University of New Mexico and Philip J. Trocchia, University of South Florida have reported results of a questionnaire survey conducted by students of marketing among some 303 respondents in the US. Five dimensions of consumers’ concern emerged from an analysis of the survey results done by the authors. These are: privacy, ethics, health, humanity and complexity.

The purpose behind the survey and analysis of the results was to identify consumer concerns regarding identification technologies calling for different degrees of invasiveness. To capture the full range of consumer reaction to various identification technologies, the survey tried to cover the broadest possible range of invasiveness. Technologies representing a variety of levels of invasiveness were selected, based on a review of the popular press and the authors’ judgment. The six technologies covered in general order of invasiveness (from least to most) were:
* Keychain tags
* Voice recognition technology
* Fingerprint scanning technology
* Facial scanning technology
* Retina (eye) Scanning technology
* Computer chip implant technology

The 26-item questionnaire was designed to elicit consumers’ concerns across all technologies. To minimize fatigue, however, each subject completed questionnaires pertaining to only two randomly assigned technologies out of the six examined. respondents read the descriptions for both identification methods and then completed a 64-item survey pertaining to those two technologies.

Statistical analysis of the responses showed that five dimensions of consumer concerns were significant. In plain English it means that consumer resistance to identification technologies, irrespective of the level of invasiveness of such technologies, could be explained by five significant factors. Other factors were found to be not statistically significant.

As mentioned earlier, these five factors are:
# *Privacy Concerns:* this factor addresses consumer fears about their personal information being intercepted by third parties and misused in some way.
# *Ethical concerns:* this factor reflects a belief that the technology in question violates personal, ethical or religious values.
# *Health concerns:* this factor reflected consumers’ fear that the technology has the potential to cause physical harm.
# *Humanity concerns:* this factor focused on consumers’ concerns that the technology dehumanizes them or improperly invades personal space.
# *Complexity concerns:* this factor reflects consumers’ concerns that the technology may be too difficult, complicated, or inconvenient to use.

These five factors explained nearly 75% of the total variance in the data. Retail marketers planning to introduce and use identification technologies to prevent credit/debit card fraud would do well to take heed of this concerns and address them in their communications with their consumers!