As the threat of e-commerce fraud increases, many retailers have focused on implementing high-level protection services. While these solutions are great for security, they're not always so great for a frictionless customer experience. Solutions that integrate complex finalizations and multiple verification layers make your website more secure, but they also make it less convenient for customers to quickly and easily make a purchase.
When it comes time for an e-commerce business to implement an effective fraud protection solution, they should consider two key components that will help keep customers happy and neutralize potential fraudsters: flexibility and an open mind.
Overly rigid fraud detection systems may result in a slow response to orders; even worse, they can increase the number of false declines. Either scenario creates a new set of problems for online businesses: unhappy customers who give up trying to make a purchase and turn to a competitor with a more user-friendly experience.
What businesses should do is gather a variety of consumer and market data, so they're prepared for every customer, and then:
- Analyze data on all approved and rejected transactions and then compare new orders with historical data
- Subscribe to a fraud protection network that shares data from several merchants
- Keep up-to-date on changing fraud patterns, through in-house surveys or reports from specialized fraud protection services
Being well-informed can prevent merchants from being taken by surprise by the next evolution in fraud techniques and will help them make educated transactional decisions.
Having an Open Mind
Knowing the signs of fraud is critical to staying ahead of the threat, but they're not always proof positive that a transaction is fraudulent. So merchants need to look beyond superficial red flags before they reject a transaction.
Imagine a merchant receives an order from a high-risk country or whose billing and shipping addresses don't match. Automatically rejecting an order because of these qualities -- without investigating them further -- may result in lost customers. So when a fraud protection system alerts a merchant about a suspicious transaction, merchants should initiate a deeper investigation into the transaction, not an automatic order cancellation.
Incorporating a Hybrid Fraud Protection Solution
Smart merchants are integrating comprehensive virtual fraud prevention solutions to protect their businesses, combining expert human analysis with automated computer-based algorithms. The result is a wealth of fraud information that exceeds what most merchants could ever generate with in-house solutions.
As a result, the checkout process is no longer bogged down by rejected transactions, confirmation calls and lengthy authentication procedures. Even better, merchants don't have to follow up on transactions and chargebacks with expensive fraud remediation measures.
E-commerce merchants today need a flexible solution to protect their growing businesses against an increased fraud risk and provide an unmatched customer experience. Is your current solution fitting the bill? If it isn't, contact us today to learn why companies around the world are trusting the ClearSale solution to protect against the growing risk of fraud and false declines.