Is your organization prepared for the holidays?
Unfortunately, this year’s holiday season is shaping up to possibly be a record-setter for fraud. Let Fraud.net help improve your customer’s experience while protecting your organization and customers from fraud throughout their digital journey.
It’s The Holiday Fraud Season
COVID’s impact is slowly diminishing, but fraudsters are not letting up on their attacks. Seemingly daily, we are seeing highly visible attacks against organizations big and small, from the government to digital merchants. With pent-up demand likely adding to the already increased fraud volumes of the holiday – the 2021 holiday season, without more focus on preventing fraud, is likely to be a most wonderful time for cybercriminals.
Below are the major components that will be feeding the likely recording-setting fraud this holiday season:
- Experts predict a 7 – 9% holiday sales increase over 2020 sales.
- An Accenture study showed a triple-digit year-over-year increase in cyberattacks during the first half of 2021.
- Deloitte predicts online sales could increase by 15% this year.
- The 2020 holiday season experienced a 40% rise in returns over 2019 due to increased online purchases, with likely another increase this year.
The holiday season’s increase in volume provides fraudsters with better cover to ply their trade. In addition, cybercriminal schemes are increasing in sophistication, as the opportunities presented by the pandemic helped them ramp up their capabilities. This is the opportune time for cybercriminals to deploy their preferred holiday fraud schemes:
- First-party chargeback (friendly) fraud is increasing as fraudsters take advantage of lax anti-fraud measures during the post-purchase stage of the journey.
- Digital retailers have to contend with credit card fraud, plus fraud via gift cards, buy-now-pay-later (BNPL), and various mobile payment applications.
- Account Takeover Fraud is snowballing, with a nearly 300% increase from 2019 to 2020 for online merchants.
Creating Digital Trust for your Customers
The digital customer experience has been defined as “the sum total of any online interaction that a consumer has with your brand”. For your business to reach a best-in-class customer experience, you also need best-in-class cybersecurity to provide the digital trust that your customers require.
In a recent PwC survey of business and technology executives regarding Digital Trust, almost 50% of Retail and Consumer leaders stated, “…they now bake cybersecurity and privacy implications into every business decision and into their planning.”
According to McKinsey, below are the five items necessary to develop a best-in-class secure digital customer journey:
- Develop consumer “personas” and appropriate digital journeys.
- Apply consumer identity-access-management controls for prioritized journeys.
- Create a reasonable balance between security and the customer experience.
- Design for both flexibility and enabling new business value.
- Build strong governance mechanisms to support a secure journey.
Securing the Digital Customer Journey
Fraud can occur throughout the digital customer journey. Organizations are rapidly coming to the realization that digital security and trust are critical parts of the customer experience. Therefore, companies need to ensure advanced fraud prevention measures are in place throughout the digital customer journey:
- Application
- Authentication
- Transaction
- Payment
- Post-purchase
However, securing your customer’s experience is more than just “locking down” your systems to make it difficult for fraudsters. Doing so will result in a rapid increase in false positives, and create severe issues for your customers and business:
- Increased customer friction and, often, abandonment of your site.
- Reputational damage to your company through negative reviews and word-of-mouth.
- Additional financial costs because of the excessive time required by your fraud team in case management.
When you need a helping hand with holiday fraud, let Fraud.net’s flexible AI-powered platform help your organization detect and prevent fraud. Our powerful tools help online retailers stay ahead of fraudsters by closely tracking and trending suspicious activity with easy-to-use tools.
Read more in our newest eBook on preventing holiday fraud, “eBook: Protect Your Customers This Holiday Season“. To learn more about how to prevent account takeover fraud, please get in touch with our experts to receive a demonstration of our services.