On Tuesday 12th September, the glorious Matteo’s hosted Balance and our friends from Braintree and dotmailer for an intimate get together with a small group of retailers, to discuss fraud prevention within eCommerce and tips for your email marketing leading into Christmas. There was no shortage of beautiful food and amazing wine to match the flow of dialogue and debate.
With so much information to cover, we’ll talk about fraud prevention below and cover off dotmailer in Part 2.
Unfortunately, fraud is extremely common in the online space, and comes in many forms – ever heard of “Friendly Fraud”? That time when your kids accidentally bought something online on your credit card? Yeah, that’s still considered fraudulent behaviour but perhaps not as serious as the organised crime syndicates operating globally to acquire your product illegally and then on sell it for cash. Fashion markets are at a higher risk than other verticals, but everyone is a target.
When considering the true cost of fraud (LexisNexis, 2016) – for every dollar you lose, you’re actually losing $2.50 when you take into account the hours spent in investigating and detecting the transactions and then attempting to recoup the cost. The average business runs 80% of their fraud detection process manually. There is huge opportunity here to create efficiencies and automate this process. Braintree comes natively integrated with Kount, which automatically conducts 250 fraud checks and leverages heavily on AI – an almost impossible task (or at the very least, a completely inefficient way) for a human to approach the problem.
Key things to consider when integrating a fraud reduction process within your own business is to consider your risk profile; balancing conversion and fraud delicately is no easy feat, but using a tool that is customisable and grows with your business will go a long way in helping. The industry benchmark for fraudulent transactions for Australia sits around the .5%* mark. The preferred number is between .1% – .2%* but if you’re sitting over 1%* then you may need to reconsider your approach.
To talk to a Balance Internet team member about fraud prevention contact us or call us on 1300 624 368.
*as quoted by Braintree