This week, The Institute published research showing one in three UK consumers (31%) have abandoned an online purchase because they were concerned a website wasn’t genuine.
While that’s a sign that scams are no longer just an inconvenience or a reputational risk, it’s also much more than that. It’s clear that fraudsters are now hitting the bottom line in a very real way.
Our findings reveal that scams shape whether people feel safe buying from a company, sharing information with it, or responding to its communications. As fraudsters grow more sophisticated, businesses must rethink how they maintain customer trust and loyalty, and be clear about where their responsibility begins and ends.
What the data says
Our research provides direct insight into how scams are affecting customers, and what they now expect from businesses in return.
First is the scale of the issue: more than half of UK consumers (58%) say they have been contacted by a scammer impersonating a real company in the past year. Fake texts are the most common route, cited by 53%, followed by calls from someone pretending to represent a company they use (49%). It’s little wonder, then, that nearly a third (32%) say scams have become harder to spot.
In this context, customer trust in a brand can be a source of strength, provided it is backed by proactive, practical support. More than four in five consumers (84%) feel safer using brands they trust, with two-factor authentication (66%) and security questions (51%) giving them the most confidence.
That trust is finely balanced, however – when a brand is used in a scam, customers also expect help: 58% want guidance on how to report it as a crime, and 45% want advice on dealing safely with the company in future. Poor handling of a scam can break even a previously well-regarded brand’s reputation.
One finding in particular stood out: nearly a third (30%) of customers believe companies should compensate those scammed by third parties impersonating them. In my view, this isn’t a realistic expectation – and as consumers, we also have a clear responsibility to do our part.
Nonetheless, it reflects a difficult landscape for businesses to navigate. What’s more, our research found that while 35% of consumers say they would be willing to sacrifice ease of dealing with companies for increased security, 32% would rather accept some reduction in security to keep a frictionless customer experience. Meanwhile, a further 32% are not prepared to sacrifice any security, while still expecting companies to be easy to deal with.
The real test for businesses
Getting this right is a genuine dilemma for organisations. For me, however, the challenge is whether businesses recognise that safety and service are now one and the same.
We all want simple and convenient interactions, but customers also need to know that a company’s website, message or call is genuine. That means making security visible at every step of the customer journey. Checks should be more proactive and as clear as possible.
Banks and building societies already offer a useful model, prompting customers to consider whether a payment could be a scam and to act quickly if something feels wrong. It is telling that our latest UK Customer Satisfaction Index ranked them the highest-performing sector.
No business can control every third-party scam, but they can reduce confusion, communicate clearly, and make it easier for customers to pause before acting. Businesses should also be upfront about the limits of their responsibility, especially when a third party impersonates them.
Customers must play their role by remaining vigilant, but they shouldn’t be left alone to work out what is genuine and what’s not. That is why businesses must take the lead: by educating and informing customers, and making security part of the service itself. Those that lean into this will be the ones customers continue to trust – and continue to use.
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