In the last few years, companies have begun to transform their business into the online world to grow, enter new markets, and reach the target group. They became aware of the fact that they must do more to provide their services to users efficiently and quickly and improve their customers' experience. However, the last year and due to the Covid-19 pandemic played an important role in imposing and accelerating this transformation. From here, building a digital identity that supports companies' work, improves the experience of their customers, and brings them more profits appeared. But, what do we mean by digital Identity? How is it built? What is its role in improving customer experience?
What does digital identity mean?
The definitions of the term "digital identity" differed. But, generally, we can say that a digital identity is a collection of features and characteristics associated with a uniquely identifiable individual — stored and authenticated in the digital sphere — and used for transactions, interactions, and representations online.
Your digital identity his a collection of information about you that is collected and saved digitally - this can be everything from your date of birth to a page you follow on Facebook.
It can be said that digital identity is a mixture between what is observed and what is revealed, objective facts and subjective values of the individual.
How is a digital identity built?
The information that makes up your digital identity can be grouped into two main categories: your digital information and your digital activities.
1. Digital information
It is the basic information that defines people. This information can be found in government-issued documents such as driver's licenses, passports, birth certificates, or from official institutions such as banks or hospitals. Such as:
- Personal information (first name, last name, date of birth, place of birth, residential address)
- A government-issued ID card (passport, driver's license, birth certificate, etc.)
- Biometrics (fingerprint, eye scan, 3D face map)
- Bank statements
- E-mail address
- Personal accounts on social networking sites
- Login credentials (username and passwords)
2. Digital activities
It is information related to an individual's digital behaviour. It is usually collected by the parties with which the individual interacts or by third parties to which the individual has granted permission. It reveals the habits, interests, preferences, and priorities of an individual. Such as:
- Likes, comments and shares on social sites
- Site visits
- Downloaded and used applications
- Online purchases
- Search queries
- Newsletters opened via email
- Geographical locations
Digital identity role in optimizing the customer experience
One of the most important factors that enable companies to succeed and provide service to customers efficiently and quickly is improving the customer experience. A Walker study found that at the end of 2020, customer experience outperformed price and product as the primary defining factor for the brand. In fact, according to Gartner's 2018 customer experience survey, more than two-thirds of companies now compete primarily based on customer experience.
According to Statista, there are approximately 4.66 billion users on the Internet around the world. This huge number of users has made improving the customer experience and making sure of the authenticity of users a priority for companies.
The process of improving the customer experience includes the periodic review and continuous updating of customer information and facilitating the purchase processes' such as providing an easy way to verify and document logging in and signing up for new users. Most online applications or platforms have already begun verifying the registration by sending a confirmation message to the user's email. However, is this step sufficient to confirm the identity of the user? What if the email used does not belong to the correct person or the email is hacked! All of this can be summed up and solved by building a customer's digital identity.
More than 15 billion email hacks were detected in 2019.
LastPass says in a 2018 report that 59% of people use the same passwords for their work and personal accounts despite the risks of hacking and theft. As a result of this, most companies have begun to develop the user experience and build the digital identity necessary to protect users' data and authenticate their data in secure ways.
Among the improvements taken, multi-factor authentication has been made by relying on the mobile phone as a reliable source for logins and account verification. Google says:
We found that the SMS code sent to the personal phone number helped block 100% of automated bots, 96% of mass hacking attacks, and 76% of targeted attacks.
Multifactor authentication is categorized into three types:
- One Factor Authentication: Login is verified by sending a passcode consisting of several letters, symbols, and numbers.
- Two Factors Authentication: It is done through the access code linked to the phone number and through a one-time access code for a specified period that arrives by text message on the mobile phone.
- Three Factors Authentication: - Three Factors Authentication: It is through - in addition to the previous two factors - the use of one of the biometrics as an eye print or a fingerprint.
The facial recognition authentication market is estimated to be $ 3.2 billion in 2019. The market is expected to grow to $ 7 billion by 2024, according to Statista.
On the other hand, we see telecom operators exploiting this feature. It encourages companies to adopt the mobile phone as a way to secure and confirm a user's identity. Identification services were developed to include several cases and were provided to companies to use them as additional services to enhance the user experience and consider the mobile phone as a means of documenting a person's digital identity.
Examples of added services related to the use of customer data in telecommunications companies to document usage and registration processes:
- Mobile Identity: This service is provided for linking a person’s account to a phone number instead of an e-mail.
- Form Filling: By sharing personal information registered with telecommunications companies to verify the information that is entered into insurance companies and loan forms. For example, the national number, the place of residence, and the name identified by the telecommunications companies and linked to the mobile phone.
- Verification: This feature is characterized by matching the entered information without the need to share different data and reveal subscribers' data.
One of the most important sectors that have worked to benefit from the services of the digital identity is the credit bureau companies, as they collect various data from several reliable sectors such as financial institutions and banks to know the level of the balance of potential customers and study the extent of their eligibility to obtain loans or even determine a ceiling Loans due to them and the guarantees required for that.
Several other service companies have been involved in this system, such as telecommunications companies, electricity and water services companies. What we will see soon is the generalization of this experience to include various sectors such as retail stores, where customers will be able to obtain a specific product in comfortable instalments without the need for any guarantees except for the personal phone number used or the national number registered in the personal identity and linked to the personal bank account.
Final words
Although building a digital identity will improve the customer experience and make it easier and faster, the adoption and implementation of these new mechanisms by companies is few for several reasons, the most important of which are:
- Laws for maintaining the confidentiality of information.
- The difficulty and cost of developing special software to support the sharing of digital identity Between the companies providing services and the companies that provide information or data on subscribers.
- The existence of a general and restricted framework for data management and preservation with one of the parties.
But it is certain that there is an increase in reliance on the mobile phone as a means of payment and means of documenting accounts and even to obtain certain services that may only be available to users of mobile phones. Thus, we advise companies to start building a unique digital identity for each customer, linking his identity to his mobile phone, and using the multi-factor authentication feature as the first step towards development and excellence.
