We spoke with marketing agency NeoLive Marketing about the future of e-commerce, advancements in payments technology and how fraudsters have evolved with it, and some security tips for consumers and retailers alike.
Check out the interview below:
The web is a vast world that we are still learning to navigate as new technologies come about what seems like every day. NeoLive Marketing preapared a Q&A with the ClearSale team to go over the start of the solution, the evolution of e-commerce, some safety tips and lastly a comprehensive ebook that discusses “How to Grow Online Sales Safely“
Where did the idea of ClearSale come from?
We saw that the market was unprotected and that inspired us to develop software to safeguard merchants from fraud, making both merchants and consumers happy and thereby driving sales. We are industry veterans and fraud prevention specialists; we do this job because we see the value it brings to merchants and we are passionate about the evolving industry. Though we have since expanded and continue to experience significant growth, our goal remains the same: continue to remain one step ahead of fraudsters through the implementation of cutting-edge technologies and expert analysis.
What is the importance of the e-commerce industry?
E-commerce transactions currently account for nearly 10% of total retail sales globally, and in some countries—like the United States, for instance— that number is over 20%. These numbers continue to climb each year, as noted in the attached report.
What’s the future of e-commerce?
Soon it will be hard even to define e-commerce sales, let alone measure them. Is it an e-commerce sale if the customer goes to a store, finds that the product is out of stock, and uses an in-store terminal to have another location ship it to her home? What if the customer is shopping in one store, uses his smartphone to find a lower price at another, and then orders it electronically for in-store pickup? How about gifts that are ordered from a website but exchanged at a local store? Experts estimate that digital information already influences about 50% of store sales, and that number is growing rapidly.
Payments innovations have also been contributing to e-commerce growth. Consumers can now choose from a plethora of options—open invoice, mobile wallet, EMV, facial recognition, etc.— to pay their own way. E-commerce has certainly become more consumer-focused and offering outstanding customer service is now necessary to appease increasing consumer demands. Allowing customers to try on clothes virtually, processing returns with ease, and offering suggestions on what to buy next based on a consumer’s purchase history will become industry norms. And digital advances are not limited to online retail stores; virtual mirrors and mobile POS devices are just a few ways tech has helped modernize the traditional bricks-and-mortar setup. Further advances in technology will continue to optimize e-commerce and drive sales through engaging with consumers and creating a seamless omnichannel experience.
Why do we keep having fraud issues despite the advancements in security technology?
As technology improves for the shopper and the merchant, we must also bear in mind that it is also benefitting fraudsters. Advances in tech have made it easier for fraudsters to commit fraudulent acts like generating fake card numbers and stealing data through bot usage or phishing. Though it would be nearly impossible to completely eradicate fraud, we can attempt to understand the mind of fraudsters to predict and counter their next moves. Criminologist Donald Cressey developed a model for risk assessment and management called the “fraud triangle” in the 1950’s that continues to hold weight today. Each point of the triangle represents a factor that increases the likelihood of fraudulent behavior. The first factor—pressure— motivates the fraudster to commit fraud due in response to emotional or financial issues. The second—opportunity—arises when there are little to no fraud controls, making it simple for fraudsters to capitalize on unprotected data. And the third factor—rationalization—occurs when a fraudster feels justified in committing fraud and refuses to self-identify as a criminal. The prevalence of each of these factors varies by region, but they work in conjunction to help us uncover the reasoning behind various types of fraud.
Can you share some safety tips for consumers when purchasing online?
Yes! There are many steps a shopper can, and should, take before making a purchase:
- Make sure that the store’s site is secure – you will see a padlock alongside the address bar. Sites without this padlock should be deemed risky and only used at your own risk.
- Make sure the web address of the online store begins with “https” – the “s” at the end means that your data will be encrypted.
- Make sure the site displays a digital security certificate.
- Before you buy in any virtual shop, check its reputation on the Internet. A quick google search can reveal if a site is a scam or has a bad rating.
- Be wary of little known companies with very advantageous offers.
- Keep your browser and computer safe from malware and viruses with anti-virus software. There are free solutions available, but don’t download anything that is not from a reliable source.
If at any point, you discover fraud occurring on your card or by a website, contact your bank or credit card company and—if necessary—file a police report.
Is there anything online retailers can do to protect their customers?
There are quite a number of things that merchants can do to protect themselves and their customers from a breach:
- As a first step, choose an e-commerce platform wisely. It is important to choose a platform that has been thoroughly tested and reviewed, and will contribute to the security of your virtual store. There are both paid and open source options to ensure this protection, just make sure to do your research.
- Store only partial data about your customers. To avoid making it easy for hackers to access data from your customers, store only partial information, such as the last 4 digits of the credit card or just the customer’s last name. This makes your data a less-than-ideal target for hackers and will help keep your accounts safe. The use of encryption software for this may be required.
- Do not allow access to complete data for anyone, even your employees. Even the most beloved or trusted employee gets tempted, and we have seen too many examples of employees who leave the company and take data with them to use in bad faith. If you must give them access, only allow them to have the partial data.
- Require strong passwords from your customers. We know that consumers don’t always enjoy having to create a password that has numbers and symbols in it, so explaining to them that this is a safety factor and helps you protect their information will allow them to appreciate the importance. Find a system that requires these kind of “strong” password combinations, and add in a note about the safety factor.
- Configure alerts for suspicious activity. There are many systems available today that will alert you if they identify a suspicious purchase. By using this type of service, you will ensure that suspicious activity is stopped before the transaction has gone through and you can get proper validation from the customer or by a specialist.
- Consider a fraud management service, such as ClearSale. Find an experienced company that specializes in fraud identification. They will use various technologies such as Device Fingerprinting, IP Address analysis, and other tools that prevent fraud through knowledge and data about consumer shopping behavior.
- Provide security training for your employees. Educate your employees so that they do not post e-mails containing sensitive data or disclose them in chat tools. In addition, it is necessary that they are aware of the laws and store security policies. All this is possible with proper training.
- Monitor your site regularly. Some security tools enable you to monitor visitor activity on your site in real time. This way you can evaluate suspicious actions and validate the buying interest of customers, confirming the legitimacy of the operation.
- Don’t skimp on your hosting service. It is essential to have a provider of quality hosting services. This will ensure that your platform is updated frequently, preventing malware, viruses and other harmful software. Avoid shared servers, and make sure that the hosting company has a solid disaster recovery plan in place.
Make sure to download the e-book to learn how to increase your online sales safely, here.