Dor Shany
January 24, 2023

Eliminating Passwords: The Impact on User Experience and Conversion Rates

Passwordless login is becoming a trend as it eliminates the need for users to remember their credentials or create a new account, making it a more convenient option. Adopting passwordless login can improve user experience and conversion rates.

Website login walls come with a significant interaction cost; users must remember their credentials (if they have an account) or take the time to create a new account. Usability tests have shown that many users are annoyed when they encounter a login wall. According to Ping Identity, 56 percent of US consumers have abandoned an online purchase because they found the registration and login process tedious.

Fortunately, passwordless login is becoming a trend today, with big name brands taking the lead and giving users the option to register and log in without a password. You might have heard the term “passkeys,” as Apple, Microsoft, and Google have partnered with the FIDO Alliance to create a new standard for security and user experience based on FIDO’s passwordless sign-in standard. A few brands that have already enabled passwordless login with passkeys are PayPal, Carnival, Kayak, BestBuy, eBay, and GoDaddy, and there is even a WooCommerce/WordPress plugin.

How can eliminating passwords impact the user experience and conversion rates of your website?

  1. Increase your identified user count

    Getting your users to log in and identify themselves is the hardest in the conversion process. Brands can attest that identified users, or logged in users, tend to convert at higher rates, engage more with content and products, and are less likely to drop off. The higher conversion is due to the fact that the users took steps to log in to their account and fill in their information, showing they trust the brand. By eliminating the need to use passwords, we can increase the likelihood of more users identifying themselves and staying logged in during their engagement with the website. More logins translates to higher conversions.
  2. Improve checkout conversion rate by reducing user steps

    As marketers and product owners, we always strive to reduce the number of steps users take to complete a checkout process. This is true for both online stores and online application flows. With both, users are required to log in/create an account during the process. Over the years, brands implemented many different solutions to try and eliminate this requirement, but none have eliminated passwords completely. Passkeys allow us to completely eliminate passwords. By implementing passwordless login/registration, we can allow users to simply enter their email address and authenticate using their mobile phone’s Face ID or Biometrics. You can implement this authentication, for example, as part of the user information request step when you collect the user name and address information, thus seamlessly converting the user to an identified one, without the need for an additional step for email confirmation.
  3. Improve your users’ mobile experience

    As of August 2022
    , over 53 percent of the total US web visits are mobile. This data means that the mobile experience is crucial for a business to succeed. Many brands take an approach based on “mobile-first design,” but when it comes to the user experience and the hurdles they must overcome to complete a checkout process, not enough has been done to simplify the process. One company that stands out is Shopify; their Shop Pay feature, which identifies the user's email address and allows them to automatically fill in their information, including payment details, by authenticating an OTP SMS code.

    This system requires the users to first create an account with a store, fill in all the information, and then choose to save it. It also requires the mobile user to get a text message and go back and forth between screens in order to authenticate. With passwordless login and passkeys, the situation is different. They allow us to provide a much more seamless experience to our users. By authenticating with passkeys, the user never leaves the checkout screen—they get the Face ID or Biometrics authentication flow pop-up in front of them, as part of their device’s OS. Once authenticated, they are still in the same step of the process as they were before, only now they are logged in and authenticated. The value of this process is clear, both on the user experience side and in terms of security.
  4. It can significantly reduce the amount of support tickets you get

    Implementing passwordless login removes passwords from the equation altogether, thus eliminating the source of friction. It also provides much better security than passwords and MFA (multi factor authentication) combined. It has been reported that 78% of people have had to reset their password in the last three months. Thinking of how many of those users dropped out of the password reset flow and how much revenue businesses lost just for the sake of users taking on the challenge to manage their passwords, it makes sense to try something else.

    Users don’t want to remember passwords or worry about password leaks to dark web databases all the time or methods to make them safer like MFA. The new passkeys technology strives to solve this problem. When a user creates an account or login using passwordless authentication, they never need to remember their password again. Their password is their fingerprint or their face. Simple as that. For example, we have seen that many brands that implemented passwordless authentication saw a massive improvement when users went to “reset password” and ended up choosing to set up passwordless authentication instead.

In conclusion, the above four impacts of passwordless login are the main contributor to the increase in conversion rate as well as reduced user drop rate. By improving the mobile experience, reducing the steps users need to take, reducing friction points like “reset password,” and having more identified users browse your website, the conversion rate trend will show a rise. This is true regarding passwordless authentication and any other solution that tackles pain points. It is clear that passkeys passwordless authentication is here to stay, with giants like Apple, Microsoft, and Google backing it and pushing both their platforms and the brands that work with them to implement it. When it comes to assessing the value for marketing flows, user experience, and revenue growth, it’s low hanging fruit.