With Asia now accounting for more than 60% of global online retail sales and e-commerce volume in Asia Pacific looking to hit US$2 trillion by 2025, the rise of digital native businesses in e-commerce and other sectors in this region is inexorable.
The rapid ascent of such businesses is evident across the region. These businesses are typically established after 2000 and rely on technology as the foundation for their business model. Concurrently, there is a shift towards hybrid work models. This combination of factors makes a strong case for businesses to consider their customer, employee, and extended workforce (referred to as “whole-of-business”) digital identities as a new asset. This digital asset holds the same significance as cash, working capital, reserves, and property.
Whole-of-business identity as an asset
As communication between consumers and workforces increasingly occurs through digital channels, organisations have gained two valuable assets: customer identity and workforce identity.
- Customer identity: Every customer identity that an organisation possesses, whether it resides in customer relationship management systems, marketing platforms, or third-party platforms, serves as an asset. This asset can be leveraged for monetisation and growth, enabling activities such as new customer acquisition, upselling, cross-selling, diversification, and brand unification.
- Workforce identity: This aspect focuses on enhancing productivity. A robust workforce identity allows employees and the extended workforce (including partners, suppliers, contractors, and vendors) to work from anywhere, ensuring they have a seamless and secure experience in this hybrid world.
As businesses strive to integrate their technology investments and thrive in today’s digital landscape, the identities of customers and the workforce, collectively referred to as “whole-of-business” identity, can serve as a significant leverage point.
On the other hand, digital identities also pose a substantial risk, being the prime target for cyberattacks such as phishing and credential theft. Therefore, it is essential to manage this liability effectively.
Harnessing digital identity to drive growth
Okta’s recently launched report, titled “Customer Identity for Digital Natives,” provides insights into how a well-executed digital identity solution can facilitate business growth and foster long-term customer loyalty.
According to a survey conducted with over 200 participants from the APAC region, 73% of respondents consider customer identity and access management (CIAM) to be a crucial component of their overall digital strategy.
Moreover, the respondents unanimously agreed that minimising friction in the authentication process, achieved through the implementation of a more seamless and secure solution, would likely result in significant improvements:
- Approximately 8 out of 10 respondents (79%) anticipate a minimum 50% improvement in sign-up and registration rates.
- Similarly, a comparable proportion of respondents (75%) estimate a minimum 50% improvement in conversion and check-out rates.
- Likewise, 76% of respondents estimate a minimum 50% improvement in customer retention rates.
These findings indicate that in the fiercely competitive digital economy, customers prioritise security while also desiring convenience and ease of use. If businesses can deliver a frictionless customer experience across various digital touchpoints, achieved through a seamless and secure authentication process, they can greatly enhance their ability to create seamless customer experiences, foster loyalty, and ultimately drive business growth.
Easy deployment of digital identity solutions
The survey also identified the primary concerns faced by businesses when deciding whether to develop and maintain in-house digital identity solutions or opt for a pre-built best-of-breed SaaS solution.
While two-thirds (66%) of respondents currently utilise an in-house customer identity solution, 28% encounter challenges in striking the right balance between a streamlined digital experience and the need for robust security, prompting them to seek alternative solutions.
Creating a CIAM solution from scratch also demands significant resources. The majority (54%) of survey participants estimated that developing a customer identity solution would require at least six full-time equivalents (FTEs) in engineering and development efforts.
Among the respondents who currently utilise a SaaS-based identity solution, several benefits were highlighted. These include the ability to achieve high scalability and reliability (73%), reduce the risk of security breaches and compromises (71%), and enhance the overall user experience (63%).
Considering the imperative for organisations to concentrate on their core business and allocate resources strategically, they often find it more advantageous to adopt a proven best-of-breed SaaS solution for identity management.
Identity management, with its implications for business growth and risk mitigation, is a crucial topic that deserves attention in the boardroom. It is vital for executives to acknowledge the significance of whole-of-business identity as an asset and take proactive steps to formulate strategies and transform their business accordingly.