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Phone Number Verification Done Right

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Phone Number Verification Done Right

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Verifying Users Has Become
Necessary for Mobile/Web Apps
Spam Attacks By Bots
e.g., Unwanted messages, link baiting
Fraud ...

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Phone Numbers Are The Ultimate User Identity
• 6 billion people
• Global reach
Reach
• Control over UX
• Control over Bran...

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Phone Number Verification Done Right

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Spam, fraud, and account takeovers (ATO) not only impact your customer experience negatively and increase churn but also hurt your brand. Verifying users’ identity during account registration and transactions can prevent spam, fraud and ATO.

Watch this slideshare to learn:
-Why phone number verification is critical for mobile and web apps
-What it takes to build a globally effective phone number verification solution
-How you can achieve higher conversion and keep costs under control.

Spam, fraud, and account takeovers (ATO) not only impact your customer experience negatively and increase churn but also hurt your brand. Verifying users’ identity during account registration and transactions can prevent spam, fraud and ATO.

Watch this slideshare to learn:
-Why phone number verification is critical for mobile and web apps
-What it takes to build a globally effective phone number verification solution
-How you can achieve higher conversion and keep costs under control.

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Phone Number Verification Done Right

  1. 1. Phone Number Verification Done Right
  2. 2. Verifying Users Has Become Necessary for Mobile/Web Apps Spam Attacks By Bots e.g., Unwanted messages, link baiting Fraud & Account Takeovers e.g., Fake listings, hacked accounts Unreachable Users e.g., Incorrect or stale user information Not Verifying Users Negatively Impacts Your Customer Retention And Your Brand Verify users are real people Verify users are who they claim to be Verify users are reachable
  3. 3. Phone Numbers Are The Ultimate User Identity • 6 billion people • Global reach Reach • Control over UX • Control over Brand User Experience • Out-of-band • Not easy to fake Security • Customer list privacy • User info privacy Information Privacy
  4. 4. How Phone Number Verification Works User enters their phone number into the app User receives a temporary PIN User enters PIN code into app Customer number is verified
  5. 5. Phone Verification Best Practices Seamless User Experience Single Account Per Phone Number Retry and Failover Short Duration For Code Validity (Minutes) Customize to Local Preferences Track & Analyze Conversion
  6. 6. The Carrier Network Is Not Fit for Phone Number Verification Confusing Numbering Plans Latency & Deliverability SMS AGGREGATOR 1 CARRIER Security Exposure with Each Additional Hop Complex Regulations 3 CARRIER 2 CARRIER 1 2 3 4 1 2 3 4 Enterprise Carrier Network Process
  7. 7. With Traditional Industry Conversion of 65%, It Is Complicated to Get It Right Each app is biased by its own data leading to increased inefficiencies › Multi-vendors needed › Retry logic to build › Routing & Analytics › Localization needed › Fixed vs. Mobile A/B Testing on : › Language › Template › PIN length › PIN Expiry › SMS or Voice › Pay Per Attempt › Complex multi-vendor rate cards › Payables/FX implications › Engineering/Ops/ Procurement teams to manage cost/quality across hundreds of networks Increased Time to Market Decreased User Experiences & Conversion Increased Total Cost of Ownership
  8. 8. Nexmo Verify: Phone Number Verification Done Right Built on Nexmo’s direct to carrier connections, adaptive routing technology, and experience with verifying over 3 billion phone numbers. Verify Phone Numbers Anywhere Simply send Nexmo Verify a phone number and then validate the user entered code Verify takes care of delivering the code and optimizing multiple parameters to maximize your conversion Template & Language Pin Length SMS or Voice Failover Method Retry Sequence & Timing Alphabetic or Numeric Sender ID 70,000 customers Including 80% of Messaging Apps in 235 countries & territories
  9. 9. How Verify Works Verification Check Customer Backend VERIFY API Verification Request attempt Retries/Failover User enters PIN Your <brand> PIN is 1212 We’ve just texted a code to +1 (847) 555-0150 1212 End User receives PIN by SMS or Voice 1 2 1st
  10. 10. Under The Hood: Verify Eliminates Complexity Reject VoIP, Toll-free and Premium Numbers Number Validation Workflow Routing PIN Mgt. RFC6238 Workflow Engine Template Mgt. SMS Voice/TTS Adaptive Routing™ Direct to Carrier Billing Analytics Pay Per Conversion API Maximize Conversion of Valid Numbers Conversion Data & Analytics PSTN Network Verification Request Verification Check
  11. 11. Verify Applies Best Practices On Your Behalf Example of Two Users Application Verify Automatic Conversion Optimization Verify Person 2 In United States Person 1 In Cyprus BEST PRACTICES • Primary Channel: TTS • Sender ID: Alphabetical Sender • Language: Turkish BEST PRACTICES • Primary Channel: SMS • Sender ID: Phone Number • Language: English
  12. 12. Business Impact From Using Verify Improved Customer Acquisition Enhanced Security Lower, Predictable Costs Instant Global Reach Zero Telco or 2FA experience required Simple API integration Fixed & mobile numbers verified globally Pay Per Conversion Flat global pricing – no rate cards to manage Dashboard to analyze costs and performance Highest deliverability with Adaptive Routing SMS or voice selection and seamless failover Customization to local preferences Spam and fraud prevention Low latency PIN delivery and time based expiry RFC6238 compliant PIN generation
  13. 13. Industry Scenarios SOCIAL NETWORKS, OTTs & GAMING APPs: Problem: Spam, Scam, ATO Solution: Prevent fake accounts used to create spam by verifying phone numbers TRAVEL, TRANSPORT & RESTAURANTS: Problem: Unreachable users Solution: Ensure that you can alert or notify customers by verifying numbers. BANKING & PAYMENTS: Problem: Fraudulent Transactions Solution: Authenticate all transactions with a One Time Password to prevent fraud. MARKETPLACES & ECOMMERCE: Problem: Fraud, ATO Solution: Verify users on registration, password resets, and suspicious transactions.
  14. 14. Case Study: Streamlining Sign-on to Public Wi-Fi with Nexmo’s Verify API THE SOLUTION THE RESULTS THE CHALLENGE • Registration via email yielded only 30% conversion. • Using SMS boosted conversions to 66%. • Social Zone wanted higher conversion rate and higher quality information for customers subscribing to its hot-spot service. • With Nexmo Verify, Social Zone boosts conversion rates to near 85%. • Improved user experience boosts brand image. • Social Zone integrated the Nexmo Verify API into its registration system. • Verify relies on both SMS and text-to-speech services from Nexmo to increase the likelihood that recipients will received crucial verification codes.
  15. 15. Case Study: Verifying New Users Around the World with Ease THE SOLUTION THE RESULTS THE CHALLENGE • pq needed to be able to authenticate app users anywhere in the world quickly and reliably. • pq was to be featured on the Apple App Store, so it needed a solution it could integrate quickly. • Five verification solution providers had already failed pq’s quality tests. • pq integrated Nexmo Verify with its sign-on system in only one hour. • A pq app ready for worldwide user authentication was on the App Store in a matter of days. • With Verify, subscriber conversion rate is above 80%. • Verify complements pq’s focus on the customer experience, boosting brand satisfaction among users. • pq integrated its sign-on system with the Nexmo Verify. • Verify relies on both SMS and text-to-speech services from Nexmo to increase the likelihood that recipients will received crucial verification codes quickly and reliably, regardless of where they are in the world.
  16. 16. Case Study: Stopping Scams at the Door of Love THE SOLUTION THE RESULTS THE CHALLENGE • 30% of new site registrants were from spammers and scammers. • Registration via email proved thoroughly unreliable. • DatesOfAsia personnel lost valuable hours each week rooting out scammers. • 94% global conversion rate with Nexmo Verify. • Spammer and scammer registrations eliminated. • DatesOfAsia personnel can now focus on improving the experience of legitimate community members. • DatesOfAsia was able to integrate and fully test Verify in just 10 hours–with no prior Nexmo experience. • DatesOfAsia had been planning to construct its own SMS-based user authentication system. • When it discovered Nexmo Verify it recognized that integrating Verify would be even more effective and far less costly in both the short and long terms.
  17. 17. Case Study: Nexmo Verify Instills Confidence in the Integrity of the Folr App & Community THE SOLUTION THE RESULTS THE CHALLENGE • Allowing others to track your whereabouts demands absolute trust in the authenticity of the other users. • Email authentication is too easily spoofed to ensure customer confidence in other Folr member identities. • Authentication needed to be quick to integrate, global in scope, and easy to manage. • Nexmo Verify creates the confidence that Folr users require to embrace the solution. • Verify PINs act as account passwords, ensuring that only verified users can access their accounts, and only using registered devices. • Verify’s global focus makes it easy for Folr users to have their devices and identities validated anywhere in the world. • Folr integrated the Nexmo Verify solution into its mobile app infrastructure. • Verify matches users to specific devices. • One-time use PINs from Verify function as passwords to unlock the Folr app on a registered device.

Editor's Notes

  • It has become critical for online businesses to ensure that the people signing up for their services are legitimate users because of several potential problems.

    Foremost of these, spam from fake accounts is a major problem especially for social networks, OTT messaging apps and other mobile and gaming apps. Spam includes contacting users with undesired content, excessive posting, link baiting, sending bulk messages among other activities. This severely sullies the user experience and if users start leaving the service, this can affect the monetization potential and valuation of the service. For instance, social networks are clamping down on fake accounts and spam as advertisers start complaining that this affects their Marketing ROI.

    A second problem is fraud. Fraudulent listings are a particularly a problem for online marketplaces. For instance, fraudsters post fake listings of rentals on Craigslist and attempt to charge a deposit for it. Some marketplaces provide fraud insurance, which can have financial implications.

    Similarly, hacked accounts and account takeovers can have a direct financial impact on businesses. For e.g., Hacked Netflix accounts are sold for $2 on some internet forums and Netflix loses out on potential subscription revenue from the buyers of these hacked accounts.

    Handling fraud is expensive too. Even if the fraud is of a small amount it can result in financial overhead in terms of customer care, higher payment processing fees, and chargebacks.

    Finally, users may enter invalid information when signing up or stop using email accounts that they used to sign up. In this case, it becomes difficult to reset their passwords, authenticate their transactions and convey critical information in general.

    In order to provide an enhanced user experience, ensure high customer retention, prevent damage to their brand, online business, services, and mobile apps must verify their users.
  • Recently, Phone Numbers have emerged as the ultimate user identity. There are several reasons for this.

    Phone numbers have the largest reach at 6 billion people across the world. Even the largest social network has about a billion users and is blocked in certain regions such as China. Further, people retain the same phone number for several years.

    Using phone numbers for verification, allows sending passcode information out-of-band from the original application providing additional security compared to a social login or an email-based login. Further, getting phone numbers involves a user verification as they have to procure numbers from carriers. Phone numbers are difficult to fake, and the right service will detect VoIP or toll-free or premium numbers so that these cannot be used to create fake accounts.

    Using services such as social logins create privacy concerns for users. They don’t want the app to get their personal information such as their likes or friends; at the same time they don’t want the social network to get information about all the apps that they are using.

    For some businesses t owning user identity management is critical for monetization and they don’t want to outsource the user identity management to a third party service. Phone number verification allows them to retain ownership of user identities.

    Finally, registration is the very first interaction of a user with the app or business, and it is critical for businesses to be able to control the user experience and branding at this stage rather than rely on someone else.
  • On the surface, phone number verification for registration looks very simple to implement. It just requires a few simple steps. The user enters their phone number in the app. The app then sends them a PIN code via SMS or voice. The user enters that PIN in the application. If the PIN is correct, the app knows that that phone number belongs to that user.
  • The user registration step is critical. You’ve already done all the hard work of getting the user to download the app or decide to sign up for your online service. Any users that get dropped at this stage result in lost potential revenue. So even though it may seem simple from the user’s perspective, there are multiple factors that need to be kept in mind to ensure that users complete the registration process.

    First is the user experience. It must be designed to clearly indicate the verification steps to the user: what to expect and what they must do next.

    Next, each phone number should be associated with only one user. This is to prevent creation of fake accounts which can lead to spam and fraud.
    The user may not get the PIN on the first attempt because of SMS deliverability issues, depending on where the user is, and I will get into this on the next slide. So it is critical to retry and use SMS or voice as failover mechanisms to send the PIN.

    For security, the PIN must be only valid for a short duration in the range of a few minutes.

    Users in different parts of the world have different preferences. Language, for instance, must be customized to local preferences to achieve high conversion.

    And finally, it is critical to track and measure your conversion so that you know what is working and what needs to change.
  • Even if you adhere to these best practices, the communications channel is out of your control and will affect your conversion rates. The traditional communications channel was not built for business critical communications. First, numbering plans can be very confusing and determining whether to use voice or SMS to send the PIN for landline or mobile phones can be tough. Next, if you connect to an aggregator to send SMS globally, your messages will be subject to severe latency and deliverability penalties because of multiple hops that the messages go through. This not only reduces your conversion rate but also creates security risks because of the additional hops. Finally, each country and carrier has their own set of regulations that must be followed to ensure that messages get delivered.
  • With all these challenges, the average industry conversion rates are low at around 65%.This is especially true when looking a global user base. In order to improve your conversion you need to take several actions that are expensive in terms of time and resources.

    First, you’ll need to build your own retry logic and collect metrics from multiple vendors. Next you’ll have to localize templates for each market (English may not provide the best user experience in every market), and build a way to detect landline/fixed numbers (no point in sending an SMS to a fixed number), and detect VoIP/Toll-free/Premium numbers to screen out fake accounts.

    Second, the user experience and hence conversion will not be optimal unless you engage in a lengthy trial and error process to fine-tune your messages market by market
    e.g. language (in India to you send in Hindi or English?), template (do you start or end with the Pin?), Pin length and expiry (in some countries 6 digits convert better than 4), and channel SMS or Voice (because of confusing numbering plan in Argentina Voice drives higher conversion than SMS).

    Third, your costs of operating and managing the solution will not only increase but also become more unpredictable. With low conversion rates, each retry attempt will increase the cost of conversion. Managing rates with multiple vendors costs and in different currencies makes it very difficult to predict your costs. You’ll need large teams in operation and product to go thru the complex learning curve involving heavy A/B testing. Understanding the regulations of each carrier in each country updating your DIY solution to incorporate those adds to the complexity and costs.

    And, even if you do all of this, your conversion rate may still not reach the maximum achievable rate because all your data is biased. For e.g., you don’t have the visibility to benchmark your conversion rates with the average across multiple apps in a market and determine whether low conversion is specific to your app or endemic to a region.

  • Over the past 4 years, Nexmo has enabled over 70,000 customers including 80% of the world top OTT messaging apps such as Line, Viber, Snapchat, WeChat, and enterprises like Airbnb to acquire over 3 billion users using SMS & Voice in over 200 countries and regions. We’ve seen how complex the process is and improved our APIs to make it easier for our customers and improve the conversion rates of their apps.

    This started with our conversion API that enabled us to gather real time data from users. Today over 500m data points are collected every month on what really works in terms of routes, localization, user experience, and conversion.

    Then we built Adaptive Routing to pick the route with highest conversion in real time to maximize your conversion rates. And we built a large database of carrier regulations including information such as acceptable sender ids, filtering rules among other to guide our customers.

    Nexmo Verify incorporates all the experience we have gained with acquiring 3 billion users and is built on top of our direct to carrier connections and adaptive routing to provide customers simplicity and the highest conversion.
  •  Verify is extremely simple to implement. As simple as making an http request. All you need to do is send Verify a request with the user’s phone number. Verify takes care of generating the code, and sending the code to the user, with retries if necessary. Once you receive a code from the user simply send Verify the code to check whether it matches the one that was generated for them.
  • What is truly disruptive is how Verify hides complexities from you, to deliver the highest conversation at a low and predictable cost.

    Verify takes care of:

    - Number validation: making sure that VoIP numbers, Toll-Free numbers, and Premium numbers are rejected. You will not only prevent fake accounts and fraud but also not get charged for any requests from these numbers.

    - Maxmimizing conversion by
    Abstracting Carrier regulations, so that your verification requests are compliant without any requirement on your part to updates messages
    Using the optimal workflow based on number type and location
    Failover to SMS or Voice and retries
    Localized templates & languages proven to improve user experience

    Collecting and analyzing data to provide you visibility into performance

    Verify’s revolutionary pay-per-conversion model ensures that our objectives are completely aligned with yours.
  • This is an example of how Verify applies best practices to give you the best conversion.

    You send Verify the phone number of a user in Cyprus. Verify uses Voice as the primary channel to send the user a PIN. The sender ID is alphabetic and the language used is Turkish.

    A second user may be in the United States. This time, Verify uses SMS as the primary channel and the sender ID is a phone no. or a short code and the language used is English.
  • There are several advantages to using Verify.

    First you improve your customer acquisition as Verify gives you the highest conversion rates with its direct2carrier connections and adaptive routing, SMS/Voice retries and failover, localized templates, and carrier compliance.

    Next, you get enhanced security by preventing fake accounts that cause spam and fraud. The PIN is delivered out of band with low latency and expires in a short time. The PIN is also generated according to the RFC6238 standard.

    With pay per conversion and flat global pricing, your costs are predictable and low. You can analyze your costs and performance right from the dashboard.

    Finally, you need zero telco or 2FA experience to give your app global reach in an instant. You can verify landline numbers or mobile numbers or both landline and mobile numbers globally.

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