Promoting Confidence

The online-payment security icon at upper right increased conversion rates at .

As the media reveals more reports of credit-card and identity-theft incidents, retailers are hard-pressed to protect consumers’ personal information both in-store and online. By partnering with third parties, PETCO Animal Supplies Inc., San Diego, is rebuilding consumer confidence and converting more online visitors into shoppers.

“Why should retailers promote security online? Because consumers don’t trust retailers,” John Lazarchic, VP, e-commerce, said at the ERI eXchange, the Conference and Expo for the Extended Retail Industry. The event, sponsored by the Retail Systems Alert Group, Upper Newton Falls, Mass., was held in June.

“Consumers are more nervous today than they were in 2005,” he noted. “In fact, 70% of shoppers will cancel an online transaction if they do not trust a retailer.”

Like many multichannel retailers, PETCO is committed to ensuring that its store-level, corporate and online systems are secure.

“We regularly test the security of our [online and offline] systems and we are compliant with the PCI [payment card industry] standard,” Lazarchic explained during the session, “Boosting Online Sales Conversion Rates.”

That didn’t stop a third-party company, called ScanAlert, from approaching PETCO about how its solution could further boost online shopper confidence levels. while’s internal team considered the test “a waste of time and money,” they agreed to test the solution.

For its clients, ScanAlert’s security team conducts a network-wide, base-line vulnerability audit. Connected via Web interface, the solution, called HACKER SAFE, automatically checks the Web site against its library of vulnerabilities to identify potential issues.

The team then provides remediation advice and immediate patch validation. Tests are conducted daily, and detailed security audits and compliance documentation, such as PCI-compliance reports, are delivered to PETCO on a quarterly basis.

Another component of the test required PETCO to display the HACKER SAFE security icon on its Web site (

“First, we tested the logo in the bottom right-hand corner of the homepage, and on all site pages,” he explained. “This test produced a 1.76% conversion rate.”

Next, the company moved the logo to the lower left-hand side of the site’s navigation bar. This move produced a conversion rate of 6.31%. By moving the logo to the top left corner between the search box and the navigation bar, the conversion rate hit 8.83%.

“We also added the logo to our checkout page,” he said. “The logo is a great way to remind shoppers that our site is secure, and it reminds us that shoppers want that added sense of validation while shopping online.”

PETCO is further securing its online experience by offering new payment options. “Stories about credit-card and identity theft are making some shoppers leery about using their credit cards when shopping online,” Lazarchic said.

That’s why added new payment options that do not require a credit card.

“Studies reveal that shoppers are five times more likely to opt for alternate payment options, and they account for 20% higher spend rates than traditional credit cards online. Our usage rates reflect this,” Lazarchic noted, adding that these options make up approximately 10% of the Web site’s typical transactions. They accounted for 40% of the company’s transactions during the 2006 holiday season. uses education campaigns to spur alternate-payment usage. “If you are going to offer new services, they need to be promoted,” he said.

“We educate shoppers about the services, and have logos and information throughout our site,” he noted. “The more security options you provide consumers, the more likely they are to become loyal shoppers.”

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