The rising concerns over app security, which means consumers are deterred from using them, could potentially cost the UK billions over the next couple of years.
More than one in three consumers have security concerns when using mobile apps, but these worries could potentially cost the UK £2.5 billion 2016, according to research by Rackspace® (NYSE: RAX).
The research suggested this figure could increase to nearly £3.2 billion in 2017.
Highlighting the fears of consumers, the research also showed that a third of those surveyed are concerned about the privacy of their data when using apps. This is a particular concern among the older generation of respondents where this figure rises (37%).
The research also revealed more than a quarter (26%) said that the failure of an app had prevented them doing something important.
The UK app economy is estimated to be worth £7.1 billion in 2016, rising to £8.8 billion next year.
Darren Norfolk, UK managing director of Rackspace, said: “Our research shows that security and reliability are the biggest concerns for consumers when using online services. Both these issues often boil down to having a robust and scalable infrastructure in place.
“Having access to expertise on how to run the infrastructure and plan for traffic peaks is something that can sometimes be forgotten, look at Pokemon Go which went down shortly after the app was launched. The technology itself wasn’t the problem, it was the fact that the IT team planned for fifty times less traffic than what they eventually received.”
With a growing number of purchases made on phones and tablets, apps have become an essential tool for brands looking to engage with consumers. Therefore, the technology that underpins these services has become crucial as it has a direct impact on the experience that users receive.
Rackspace said having an effective infrastructure in place is particularly important for enterprise businesses that have built a reputation which can be severely damaged by an online service going down or having a security breach.
It’s not just consumers who should be concerned about data security. BEA systems recently warned UK businesses about the potential costs of cyber-attacks and internet security, which stands at an average of £330,000. For one in ten companies, this figure could increase up to £1 million.
The wider benefits of apps
Despite the hesitancy of some consumers, research shows that the UK population is still saving 2.2 hours per month by using apps and online services.
Over half of research respondents reported that convenience (51%) and time saving (45%) are more important than spending less money (25%) as benefits of using apps and online services.
Mr. Norfolk added: “The advantages that applications and other online services give to consumers and businesses are vast, particularly because they are helping people to perform everyday tasks quicker and more conveniently.
“To be successful, businesses need to include these modern services as part of the overall business strategy. This will ensure that they are supported by sufficient resources and planning.”