Customer acquisition is one of the top priorities for many companies. After all, that is what profitability depends on—right? There is no doubt that new users, new deals, and new leads are business-critical. But one aspect must never be overlooked: customer retention. Even seemingly small details can determine whether the customer journey succeeds. One example is Customer Identity and Access Management (CIAM).

Customer retention is often considered more cost-effective than acquiring new customers. Measures aimed at retaining existing customers can be up to 25 percent less expensive. On top of that, returning customers contribute to stable business growth through higher profitability and revenue. Satisfied customers bring another major benefit: they are loyal and, ideally, recommend products or services to others.

That is why organizations should do everything they can to keep their customers happy. Quality, fair pricing, and excellent service are usually the first things that come to mind. But what about the “small things” in customer interactions—such as Customer Identity and Access Management?

In many organizations, CIAM is still seen primarily as a technical necessity. As long as the login works, that seems good enough. But for customers, Customer Identity and Access Management is much more than a login window. It is the first point of contact, the recurring touchpoint—and often the starting point of frustration.

Whether it is registration, login, password reset, or additional security checks, each of these steps can affect customer satisfaction in both directions. If the process runs smoothly every time, that is the ideal scenario. If it does not, satisfaction suffers. And if negative experiences linger until the next point of friction, customers may ultimately decide to end the relationship altogether. This is exactly where it becomes clear whether users stay, drop off, or contact support.

CIAM therefore has a direct impact on:

• the perceived quality of a digital offering,
• trust in security and professionalism,
• and the willingness to use a product regularly.

Authentication plays a central role here. In practice, it has evolved historically in most companies. Username and password still form the foundation, often supplemented by additional factors such as one-time codes, authenticator apps, or single sign-on. From a technical perspective, this setup works. Ask users, however, and you are likely to hear a very different story. Security concerns also come into play. Especially in modern software environments, many decision-makers are finding it increasingly difficult to maintain a clear overview of all the application components involved.

Registration processes are unnecessarily complex, password rules are hard to understand, and security checks are inconsistent. On top of that, measures such as multi-factor authentication are not always used in a risk-based way, but instead applied across the board or only to individual applications. The result is an inconsistent user experience that is neither clearly explained nor intuitive.

Authentication could be approached very differently. Modern approaches rely on a small number of well-coordinated mechanisms: clearly guided login flows, adaptive security checks, passwordless methods such as passkeys, or context-based decisions that trigger additional security measures only when they are truly needed. The goal is not maximum security at any cost, but a balanced combination of protection, convenience, and transparency.

That these connections are not just theoretical is shown by a recent survey of more than 400 CIAM decision-makers. The findings highlight just how strongly authentication influences customer satisfaction and business performance today—and where many companies are reaching their limits despite good intentions.

• 82% of companies report business impact from problems in customer authentication, ranging from increased support effort to lost revenue.
• 30% of organizations experienced user churn due to overly complex or frustrating onboarding and login processes.
• At the same time, 87% still rely on usernames and passwords, even though only 2% consider this model a good balance between security and user experience.

You can find out more in our joint white paper “Customer Identities in Focus 2026”, created together with umbrella.associates.

Winning new customers is expensive. Losing customers is often even more expensive. Yet in many companies, one central part of the customer journey is barely questioned at all: authentication. Customer Identity and Access Management may function technically in most cases, but it also needs to meet users’ expectations for a fast and seamless process. So where should organizations start? The white paper offers insight into the current state of play and highlights modern alternatives.

If you would like to read more about a specific solution for digital customer relationships, you can continue here.