Identity verification adds important, and often compulsory, steps to your conversion funnel. Here’s how to set it up to stay compliant without losing conversions.
October 11th, 2019
The online business world is conversion-crazy. Almost synonymous with sales, conversions can mean many different things depending on the context of the metric and what you want to measure.
If you are a software as a service (SaaS) provider, you may use the term conversion rate to track sign-ups on your website. If your service comes with a free trial, you may instead track conversion rates from trial to paid. In the end, what matters is knowing how leads become customers, and using that knowledge to make it easier for people to purchase your solution.
As a general rule, the shorter the funnel, the higher the conversion rate. In theory, you limit the steps as much as possible for the best results. In some industries, however, regulatory environments demand extra steps like KYC compliance laws or the European Union PSD2 directive, which can have a devastating blow on your conversion rates.
Looking for a service that will optimize your verification process? Start a free Veriff Station trial.
If you are a fintech business, marketplace, or blockchain service provider, then skipping out on identity verification for new customers is not an option. This guide is to help you understand:
Whether it’s for KYC compliance or to ensure that your users are who they are, identity verification adds a step to your conversion funnel. But not all steps are created equal.
There are a lot of factors that affect how well an identity verification service converts users. Of the ones that are tougher to control, the degree of familiarity with an identity verification service is one of the most challenging to address.
The trends are often industry-specific, with new industries where familiarity is low scoring the worst. The following numbers are gathered from tens of millions of verifications conducted by Veriff across multiple industries, our primary ones included below.
Different industries come with different complications. Cryptocurrency and blockchain clients tend to have lower conversion rates, partially because of the broader range markets they operate in. Cryptocurrency products and services offer financial solutions in markets with limited digital banking services and low internet penetration rates, which presents both a huge opportunity and challenge.
Users with limited familiarity with online products may require more support before they start verifying their identity than a user that regularly signs up for online services that require some form of user verification. The absence of additional support is one possible reason why these markets tend to have lower verification conversion rates than those where the digital economy is more developed.
*Source: Internet Live Stats 2016
In addition to a user’s general familiarity with web or mobile interfaces, there are other controllable factors that play a huge role in the dropoff rate. Some of these are your responsibility, while others should be carefully considered when selecting an identity verification service provider.
A simplified user interface with concise, informative copy goes a long way, but there will always be users who need an extra push through the funnel. Live user feedback based on standard errors make a huge impact on conversions, giving users the information they need in real-time.
The more steps in your conversion funnel, the more opportunities your customer has to drop off. This applies to identity verification as well, but then comes the issue of which steps to leave out, especially when compliance laws come into play.
Veriff solves this with live background video, which handles liveness checks and gets multiple angles of the photographed ID without adding steps for our users. Watch a video of our verification flow here.
Verifying identities demands a lot of trust from your customers.
Clients with the lowest conversion rates often have one thing in common: they drop customers into our verification flow without giving them an idea of what to expect. Moreover, they don’t make use of Veriff’s software customization options, resulting in a jarring visual change from your onboarding UI to ours.
Think from the perspective of your prospective customer. You sign up for a service and are asked to verify your identity you are given little to no reason why. Not to mention the fact that there's no reassurance that your data will be kept safe by this mysterious third-party service.
If you’re not sure where to start, the next chapter will help you navigate through the different measures that will help you optimize your identity verification process.
This chapter will cover some practical tips on how to minimize drop-offs during identity verification, including live examples from our highest converting clients. But before diving into the actions, it’s important to be prepared for the inevitable first result of adding identity verification to your onboarding flow.
No process is perfect from the get-go. When introducing identity verification, be prepared for a drop in your conversion rate but don’t dwell on it.
As you monitor performance you will, with the help of a cooperative identity verification provider, be able to make adjustments that will have a positive impact. The first of which being how well you prepare users for the verification process.
Giving your users as much information as possible before verification will boost their chances of moving through your conversion funnel. This can come in many forms from adding a short intro to giving a full demo video before the process even begins.
Mintos, a peer-to-peer lending marketplace and one of our highest converting clients on the verification front, use a combination of materials to educate their users before they start verification.
Specific FAQs give their users plenty of details before dropping into our verification flows. If you don’t have too much feedback to go on yet, you use our 10 tips for breezing through identity verification as a resource.
Another great idea from Mintos is a reminder to verify your identity later. Your customers might be signing up from a bus on the way home from work or at dinner with an awful date. In either case, it may not be the most convenient time for them to start verifying identity documents.
That is where a reminder can come in handy, both for your interested customers and your conversion rates. A less dynamic way of reminding your users are push notifications or emails when they drop off during the process.
This is especially relevant to drop-offs in stages where users have to take photos of their IDs, suggesting that they may simply not have them handy.
Depending on the decision, your customer’s verification session might be approved, declined, or require a resubmission. Approval notifications are easy, simply send an email or SMS letting them know that they can start using your services.
It’s the declines and resubmissions that are tricky.
The more steps in the conversion funnel, the less likely a user will make it to the end, and roadblocks like resubmission requests don’t help. That is why they need to be as informative and specific as possible in your notifications.
If your customer did not succeed the first time, explain why. Veriff gives a list of reasons for resubmissions and declines, and you can even use webhooks to automate email messages with the right information. This is particularly helpful if checking individually adds too much manual work for the responsible team.
There are several ways to establish trust during identity verification beyond informing users that their data is safe and secure. Some visual cues can include GDPR badges or a visual guide of one of your employees going through the process.
Other, more subtle ways to establish trust is to maintain your visual brand throughout the process as much as possible. Users do not want to feel like they are being redirected, and third-party verification services like Veriff offer SDK customization options to make the journey from your onboarding to our flow and back as smooth as possible.
Continuously update your FAQs, on-site information, and support resources based on the feedback you receive from customers.
Whether it’s verbal or numeric feedback, confused client emails or massive drop-offs when they’re asked to take a selfie, adapt the information you provide based on the results you see. If you handle identity verification in-house, making changes is easy. If you’re looking for a provider, then make sure they are willing you grow and adapt to your needs.
If you use a third-party service to handle identity verification, then you know from experience that an in-house solution doesn’t always work. That is why Veriff sees client relationships as an equal partnership, and we work together with your team to get you the best possible verification conversion rate.
In addition to doing the best we can to optimize our software for your customers, our team will help you seamlessly integrate Veriff in your onboarding flow. Learn more about partnering up with Veriff by getting in touch with our sales team.