Seven hidden costs of poor sign-in experiences

When we think of customer sign-in experiences, we often focus on the obvious. Is it easy to log in? Can users access what they need quickly? While these are crucial, many businesses overlook the hidden costs of a poor sign-in experience—costs that can quietly erode their bottom line, damage their reputation, and hinder long-term growth.

A poor sign-in experience doesn’t just inconvenience your customers; it creates a ripple effect that impacts various areas of your business. Let’s uncover some of these hidden costs.

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1. Frustrating login experiences that drive customers away  

We’ve all been there: you try to log in, and suddenly, you’re trapped in a maze of forgotten passwords, confusing recovery processes, or long verification steps. Each added friction point increases frustration, and frustrated customers don’t stick around.

A poor sign-in experience can significantly increase churn rates, and often  companies don’t realize the connection. Customers are unlikely to directly cite "bad login experience" as the reason they leave, but they will seek alternatives if accessing your services feels like a chore. This subtle driver of churn is a hidden but substantial cost. 

The impact: Losing customers means not only losing immediate revenue but also missing out on their potential lifetime value. 

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2. Missed opportunities for customer engagement 

A simple sign-in process can be the first step in a personalized customer journey. Once customers sign in, they should feel at ease to check out your products and services. However, if their first interaction is a hassle, they’re less likely to stick around to engage with additional offers, upgrades, or promotions.

A poor sign-in experience creates a psychological barrier, preventing users from exploring the value your business has to offer. This leads to missed opportunities to upsell or cross-sell—opportunities that are invisible in standard analytics because the customer never got far enough to interact.

The impact: Every missed opportunity for upselling or cross-selling results in lower customer value and stunted growth.

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3. Higher customer acquisition costs 

Businesses spend significant amounts of money acquiring new customers, through marketing, advertising, and partnerships. But a poor sign-in experience can negate that investment. When customers abandon their journey at the login screen, your business essentially pays to acquire the same customer more than once. In fact, A study by Invesp shows a new customer can cost five times more than retaining an existing one. 

For instance, if a user signs up but can’t log back in or decides not to return because the login process was frustrating, you’ll need to invest in retargeting campaigns or customer recovery efforts. This rework adds an invisible yet significant layer of cost to your customer acquisition budget.

The impact: Acquisition costs increase as businesses must repeatedly invest in retaining or re-engaging customers who could have been long-term users.

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4. Increased security vulnerabilities 

Many businesses assume that requiring complex passwords or adding layers of verification will increase security. While that’s true, over-complicated sign-in processes can backfire. Customers frustrated with lengthy or confusing login requirements often resort to insecure behaviors, like reusing passwords or using easily guessable credentials.

A poor sign-in experience can indirectly lead to more vulnerable accounts, which, in turn, increase the risk of a data breach. Breaches not only cost businesses in immediate damage control but also result in long-term financial losses, legal fees, and reputational damage.

The impact: Security breaches can lead to expensive mitigation measures, fines, and loss of customer trust.

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5. Damage to brand reputation

Customer trust is the foundation of any successful business, and a poor sign-in experience can damage that trust in ways that are hard to quantify but easy to feel. Customers may not directly associate sign-in friction with brand distrust, but over time, it can contribute to an overall sense of frustration.

This subtle dissatisfaction spreads faster than businesses realize. In today’s hyper-digital world, poor experiences are often shared through social media, online reviews, and word of mouth. For instance, 21% of people will lose trust in a brand, whether they’ve been a customer or not, because of bad word-of mouth. 

While some of these complaints might not mention the sign-in process explicitly, it’s often an underlying issue that contributes to a negative overall brand perception.

The impact: Reputation damage leads to decreased customer loyalty, reduced word-of-mouth marketing, and difficulty in attracting new customers.

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6. Negative employee experience

A poor customer sign-in experience doesn’t only affect users; it can also burden your internal teams. The customer support team often bears the brunt of complaints from users struggling to log in. Whether it’s resetting passwords, troubleshooting login issues, or explaining verification steps, a poor sign-in experience increases their workload.

Increased support requests not only raise operational costs but also divert resources from higher-value tasks. Meanwhile, the development team is often tasked with continuously patching or adjusting a broken sign-in flow, which detracts from innovating other parts of the platform.

The impact: A poor sign-in process can lower workforce productivity and raise operational costs.

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7. Regulatory and compliance risks

With privacy regulations like GDPR and CCPA becoming stricter, businesses must also adhere to accessibility standards like WCAG (Web Content Accessibility Guidelines) to ensure that sign-in processes are inclusive. A poorly designed sign-in flow that doesn’t adequately secure user information, accommodate accessibility needs, or make it easy for users to manage their data, could lead to non-compliance. 

Failing to meet these regulations can result in hefty fines, legal repercussions, and lawsuits if customer data is exposed or users are excluded due to inaccessible design practices. In addition to regulatory costs, there’s the risk of leaving money on the table. A survey of U.K. consumers found 55% had abandoned a purchase due to accessibility issues, with those lost sales amounting to a potential £120 billion forfeited by retailers. 

The impact: Failure to meet compliance requirements can increase legal risks, fines, and costs.

How to combat these hidden costs

To mitigate these hidden costs, businesses should view their sign-in process not as a mere entry point but as a critical touchpoint in the customer journey. A customer identity and access management (CIAM) platform, like Strivacity, is designed to simplify sign-in processes while enhancing security and customer satisfaction. Here's how it can make a difference:

• Enable customer insights: CIAM platforms provide detailed insights into where and why you’re losing customers during the sign-in process. With real-time, data-driven recommendations, businesses can pinpoint areas for improvement and quickly take action to reduce drop-offs.
  
  
• Simplify access: Offering passwordless authentication, social logins, and single sign-on (SSO), CIAM reduces friction and accelerates access. These options keep customers engaged, lower abandonment rates, and elevate overall user satisfaction.
  
  
• Personalize experiences: Progressive profiling gathers customer data over time, making the sign-up process less daunting. Features like self-service password resets empower users to resolve login issues independently, freeing up support teams to focus on higher-value tasks.
  
  
• Secure without friction: CIAM integrates strong security measures like multifactor authentication (MFA), passkeys, identity verification, and automated risk signals, which detect suspicious behavior behind the scenes. These features enhance security without adding unnecessary steps for users.
  
  
• Reinforce brand trust: CIAM allows businesses to maintain consistent branding throughout the login flow. A seamless, branded experience not only builds trust but also aligns with accessibility standards, giving users confidence and a positive first impression of your platform.
  
  
• Simplify compliance: Built-in compliance with data privacy regulations like GDPR and CCPA, as well as WCAG accessibility standards, ensures businesses can handle customer data securely and inclusively. Consent management features and secure data practices lower the risk of legal penalties and boost customer trust.
  
  
• Accelerate deployments; boost innovation: CIAM simplifies and accelerates the deployment of secure, scalable solutions, reducing the time developers spend troubleshooting sign-in issues. This gives teams more time to focus on delivering innovative features and improving the broader customer experience.

Ready to take action? 

The sign-in experience may seem like a small part of the customer journey, but the hidden costs of a poor experience can have far-reaching effects on your business. From customer attrition to increased security risks, the cumulative impact can quietly erode your revenue, brand, and operational efficiency. By addressing these often-overlooked areas, you can transform sign-ins from a point of frustration into a source of competitive advantage. 

Interested in learning more? Schedule some time with us or jump straight to booking your own customer journey assessment today.