What is Customer Identity and Access Management (CIAM)?

Customer identity and access management (CIAM) enables organizations to securely capture and manage customer identity and profile data,and control customer access to applications and services. CIAM solutions usually provide a combination of features which may include customer registration, self-service account management, consent and preference management, a single sign-on solution (SSO), a multi-factor authentication (MFA) solution, access management, authorization, directory services, data access governance, identity proofing, identity orchestration, and even threat detection and fraud mitigation. Decentralized identity is also rapidly becoming part of CIAM solutions.

The best CIAM solutions ensure all customers have seamless and secure experiences to instill trust, no matter which channels (web, mobile, etc.) they use to engage with a brand.

These solutions can be delivered via software that can be deployed on premises, in private clouds, or via identity-as-a-service (IDaaS) platforms. Some platforms expose their capabilities—including admin capabilities—via APIs and are geared toward development teams who want to embed CIAM services into their applications. Regardless of delivery method, the goal is to make the experience of accessing digital applications seamless and secure.

Customers want two simple things when they interact with brands.

• A great user experience

• Protection from fraud, breaches and privacy violations

Seamless Customer Experience

Delighting your customers means ensuring their journey from prospect to loyal brand advocate is as smooth as possible. That includes personalizing their experience without being overly intrusive. A CIAM solution allows you to collect data from their interactions with your website, apps, and partner apps, giving you a well-developed customer profile without putting unnecessary friction in the customer’s way. It also helps to ensure that critical services are up and available when customers need them, which is critically important for customer retention. If you fall short of providing an exceptional experience, your customers may go elsewhere.

Given what’s at stake, a great customer experience is no longer just nice to have; it's a critical differentiator. Users have little patience for bad or clunky digital interactions: according to a customer survey by the CX platform Emplifi, about half of customers have left a brand they were previously loyal to in the past year as a result of a bad customer experience. 

Given the fact that it costs more to acquire a new customer than to retain an existing one, organizations need to get customer experience right.

Check out this short video that explains why customer identity is so important, and the impact it can have on your business.

Try out our business value assessment to learn just how much value a customer identity solution could bring to your business.

Data Protection

Customers also care deeply about security. According to McKinsey, 53% of consumers make online purchases or use digital services only after making sure that the company has a reputation for protecting its customers’ data. This makes sense, given 43% of consumers have experienced fraud from having personal information stolen online. Once a customer has experienced identity fraud, they become far more cautious. According to Ping’s 2022 customer survey, over half of these customers become less willing to give out data online, and many take actions such as prioritizing online accounts that offer multi-factor authentication (MFA) and deleting accounts that they feel are not adequately secure.

Even putting aside the risk of customer abandonment, fraud and breaches carry a variety of costs for businesses as well. The global average cost of a data breach in 2022 was $4.35M, and stolen or compromised credentials were the most common cause of breaches, with this attack vector costing businesses $150,000 more than the average cost of a breach.

As customers have distinct requirements in contrast to employees, Customer Identity and Access Management (CIAM) is built to cater to their demands, providing both the security and convenience that customers expect while traditional identity and access management (IAM) focuses on providing secure access to internal systems and applications for employees, without necessarily prioritizing the ease of use and convenience that customers demand. While use cases have converged or overlapped, there are still some differences between the two disciplines.

Customer IAM includes:

Unified profiles

Customer access has grown beyond web apps to include mobile partner applications. CIAM enables unified customer profiles so that you can provide consistent multi-channel experiences and personalized interactions with your customers and business partners.

Security requirements

The increased scale and frequency of data breaches has left many organizations unsure of their ability to protect their most valuable customer data. CIAM solutions provide powerful security features for organizations and users alike. Users can protect their accounts with multi-factor or passwordless authentication, while organizations can prevent breaches and account takeovers using risk signals, as well as stop fraudulent account opening using identity verification.

Performance and scalability

If you’re like many enterprises, the amount of data you’re collecting about each customer is increasing exponentially. You may also experience fluctuating customer demand due to seasonality or other reasons. Operational resiliency becomes extremely important at these times – you must ensure that customers can access critical services when they want them, even at times of peak demand. A CIAM solution allows you to deliver instant and frictionless access to customer-facing apps and services during peak usage times and as your customer base grows.

Privacy and regulatory compliance

Customers are sharing more and more information with organizations and their partners to make interactions easier and more personalized. But your customers’ concerns about data privacy haven’t lessened, and they expect you to be good stewards of their data.

CIAM solutions help you demonstrate your security commitment by giving customers the ability to control how and with whom their data is shared. It also gives you the capabilities to enforce customer consent and comply with privacy regulations like the General Data Protection Regulation (GDPR), the California Consumer Privacy Act of 2018 (CCPA), the Health Insurance Portability and Accountability Act (HIPAA), the Brazilian General Data Protection Law (LGPD) of 2018, the New York Privacy Act of 2019, the Consumer Data Right (CDR) of Australia, the Washington Privacy Act of 2020, and the Virginia Consumer Data Protection Act of 2021. Additionally, the European Union's ePrivacy Regulation, which will replace the ePrivacy Directive, is currently under development and expected to be implemented in the near future. 

As new regulations are introduced and come into effect, organizations must ensure they can answer questions about how PII is collected, stored, and used – and give customers control of their data.

Customer identity and access management plays a foundational role in enhancing both security and experience across your customer’s journey. A 2022 Ping Consumer Survey: Earning Trust Through Convenience and Security found that 59% of online consumers have abandoned an online service when logging in was too frustrating.

While your specific journey may look slightly different, the core stages are typically consistent, beginning with acquisition and retention. Here are the ways customer identity and access management helps you deliver a smooth and secure journey, beginning with acquisition and customer retention first.

Acquire and Retain Customers

A lot of money is spent getting new customers to interact with your brand for the first time. The registration process is your chance to leave a lasting impression, making it a critical aspect to get right.

Registration

Registration is the pivotal point when you’re able to capture a new prospect. CIAM helps you ensure they complete the process by:

• Enabling convenient registration capabilities like social registration
• Providing customized registration forms that are pixel-perfect representations of your brand
• Ensuring registration is consistent for all apps
• Incorporating identity verification or data affirmation into the registration experience when necessary

A streamlined registration process helps you minimize abandonment and maximize conversion rates. It can also help you gain better confidence in your users and decrease fraudulent new accounts created with stolen or synthetic identities.

Authentication

After registration, customers must authenticate their digital identities again to interact with your digital properties. If they have to use a different set of credentials for each application and can’t easily access desired services, content or products, , they may walk away from your brand and straight into the arms of your competitors.

CIAM lets you provide single sign-on so customers gain easy access to all applications—even partner apps that you don't own or apps in the cloud—with a single login screen and set of credentials. SSO with social login gives your customers the additional convenience of using their credentials from providers such as Google, Apple, and Meta to authenticate. At the same time, customer-friendly MFA using SMS, email or push notifications from branded  mobile apps to complete authentication ensures the sign-on process is both simple and secure

Drive Loyalty & Revenue

Companies must focus on delivering convenient and consistent customer experiences across online channels to new and existing customers. CIAM provides brands with a holistic view of their customers, while providing customers with a better experience.

Self-Service

Your customers need the ability to access their data consistently across all channels. Even with SSO and a consistent sign-on experience for all apps, if you don’t have a centralized customer profile that syncs across all channels, customers will be frustrated. For example, imagine a customer updating their address in your web app, but ordering a product through your mobile app and having the product delivered to their old address.

Support

To ensure a small problem doesn’t balloon into a major issue and a lost customer, you need the ability to quickly and effectively address support requests.

Support calls are typically frustrating and made worse by forcing customers to authenticate multiple times, especially if they have been on hold for a long time. Using CIAM capabilities, your support reps can identify a customer who is already logged in on the web or mobile application, allowing the rep to address their issues more quickly.

Personalization

As customers progress in their journey with your brand, they may be interacting with multiple applications and channels that want to store different details about customers. Some examples include:

• An ecommerce app wants to store information about the styles of clothing a customer prefers
• A pharmacy app wants to store whether a customer wants reminder notifications about prescription refills
• A loyalty app wants to store the types of rewards a customer is interested in

Customer Identity solutions provide the ability to store various types of customer data, including custom attributes and unstructured JSON objects. This data can be stored in a single unified customer profile, so any app can use data or preferences set in any other app to personalize a customer’s experience. With the benefit of CIAM capabilities, your various digital properties can offer meaningful upsell opportunities and deliver personalized, omni-channel customer experiences.

Build Customer Trust

Like loyalty, trust is something that’s built with your customers over time. You do this by giving them control over and visibility into their data and how it’s being used.

Privacy

Privacy regulations like GDPR and CCPA impose steep fines on companies that fail to comply. But at their core, they exist to encourage companies to be good stewards of customer data. Customer identity plays a critical role in helping you protect the privacy of your customers’ data and build a foundation of trust with your customers.

Collecting customer consent and enforcing it are two different things. CIAM helps you do both. Giving your customer the ability to accept your privacy policy or decide who you share their email address with are examples of collecting consent. To enforce it, you need to make sure apps are able to access only the data that the customer agrees to share.

CIAM tools allow you to inspect customer consent and make sure it’s enforced. In the case of sharing emails, if the customer has specified that their email shouldn’t be shared with a partner app, the email address will be excluded when the app requests customer data. This type of enforcement ensures compliance with privacy regulations and also facilitates responsible open business. By giving you assurance that data is being shared based on consent, you can leverage open business to provide even better customer experiences and gain a leg up on your competition.

At every stage of the user journey, CIAM ensures customer data is protected and secure. The unique capabilities of customer identity help you strengthen security, while minimizing the likelihood of data breach and fraud.

Data Breaches

Data breaches typically involve a bad actor gaining access to many customer records—often many millions of records. Those records may contain passwords, usernames, phone numbers, credit card numbers or other personally identifiable information (PII). Simply posing as a customer will usually not help a hacker successfully breach large amounts of data, because customers don’t have access to the data of other customers. Instead, these attacks are often performed by insiders or are due to inadvertent mistakes made by IT or development teams.

Customer identity helps you thwart breaches across several fronts:

• It encrypts or tokenizes data so that even if a hacker gains access to it, the data is very difficult or impossible for them to use
• It alerts administrators of suspicious activity, such as an admin account gaining escalated privileges to customer data
• It makes log tampering evident, so an insider cannot cover their tracks when attempting to breach data
• It limits the amount of records an administrator can download so they’re unable to act quickly, giving you more time to detect the suspicious activity

Fraud

In contrast to a breach, fraud attempts are more targeted towards individual customers. In a typical scenario, fraudsters may obtain customer credentials through a phishing attack or from a breached site and then use those credentials to target high-value sites such as banking websites. Unfortunately, since customers often share credentials across multiple sites, fraudsters often succeed in their attempts.

So how can you prevent fraudulent activity?

MFA

One solid defense against fraud is MFA. Multi-factor authentication goes beyond usernames and passwords, requiring an additional form of authentication to verify a user’s identity. Often this involves sending a push notification to a device that is linked to a customer’s account.

Sending push notifications from your mobile app through a customer identity mobile SDK is the most secure and convenient method of MFA. However, since you can’t force customers to download your mobile app, you must offer additional methods of MFA to ensure customers aren’t inconvenienced.

Adaptive Authentication

Unfortunately, fraudsters are constantly looking for ways to penetrate accounts and pass the MFA barrier. Flooding users with authentication requests can lead to MFA fatigue, which may result in users approving a fraudster’s request. To combat this, you can enable adaptive authentication. Adaptive authentication is able to evaluate customer behavior, information from their device and other contextual factors. It uses this information in real-time to determine the level of risk involved, adding MFA only when warranted. By limiting the need for additional authentication to higher risk scenarios such as logging in from a new device, you’re able to reduce the likelihood of MFA fatigue and eliminate friction from risk-free transactions, streamlining the customer experience.

Identity Verification

In certain situations, it is critically important to have complete confidence in a customer’s identity. For example, a bank that is issuing a large loan wants to be certain that the requester is who they say they are. Identity verification in situations such as these allows an organization to confirm that the user’s identity is legitimate, and that the user is the true owner of that identity. There are many use cases for fraud prevention utilizing identity verification, and it can be integrated directly into an organization’s user journey at key points

Integrated Fraud Prevention

Taking it one step further, you can consider incorporating multiple fraud prevention tools into your customer experiences by adding threat detection capabilities and implementing centralized fraud decisioning and orchestration. CIAM can play a key role in protecting you and your customers against fraud without forcing users to jump through endless security hoops. By aggregating the context provided by a variety of threat detection sources, you can dynamically send users down paths appropriate to the level and type of risk they are exhibiting, not just at the point of authentication, but through the entire user journey.

Customers have a choice about doing business with you. If you're not meeting their experience expectations, or if they fear their data might be compromised, they can easily go to a competitor. On the other hand, when you’re able to delight them with seamless experiences and protect them through every stage of their journey, you’re able to acquire and retain more customers, drive increased revenue and loyalty, and earn their trust.

Watch this short video to see how Ping approaches CIAM and makes creating secure and seamless customer experiences easier than ever.