Data Can Fight Fraud And Remove Friction For Holiday Season
The 2020 holiday shopping season will be different from any that have come before it, and much of the difference will revolve around digital capabilities.
Merchants are adapting quickly to a rapidly digitizing environment, caught between trying to build a smooth, seamless experience for their good customers and trying to prevent fraud of all sorts as attacks increase in both number and activity level. Sevounts said there are no silver-bullet solutions, but there are data to be leveraged to build a better, more secure experience and improve business operations as a whole.
“First of all, merchants should be prepared to offer a customer journey that eases friction. The less friction there is, the better the conversions will be,” he said. “But friction comes in at several points in the digital journey, and merchants need to be ready to account for all of them.”
Sevounts said fighting friction means following the consumer at every point of the journey — understanding what they see well enough to create an experience that’s smooth, but also secure, from start to finish.
What Winning Will Require
Sevounts noted that inventory will likely be king this holiday season — and inventory management will mean more than simply having the right goods in adequate supply.
The challenge in a year when digital shopping is the rule will be ensuring that merchants don’t only have the goods consumers want, but also a desirable path to accessing items.
“They need to have the ability to ship on time to have it at the consumer’s door on the right day, or the option to purchase online and pick it up at the store,” Sevounts said. “The power of inventory isn’t just having it but making sure it can get to the customers how they want, when they want.”
But providing such multichannel commerce will be challenging. For instance, Sevounts said it means having customers’ preferred payment options equally accessible across channels. And it means looking at all of the pre- and post-transaction steps in a commerce journey, from initial account creation to post-purchase communications and reach-outs.
He said merchants will find it challenging to maintain such a holistic view, but building the right customer experience requires digging into the data so retailers understand clients well enough to build to their needs. It’s also critical to keep customer journeys as secure as they are seamless across channels.
Securing The Whole Journey
The challenge is that there has not only been a numeric uptick in fraud cases since the pandemic began, but also an expanding range in the variety of scams.
Sevounts said fraudsters are known to go after anything. They create false accounts using stolen consumer data, or they take over existing accounts with saved payment credentials to make fraudulent purchases. Or they log into loyalty programs and start draining down the stored value within them.
There’s no single lock-off point to which all fraud can be defended against. It’s an ongoing series of attacks that can literally occur at any point within the commerce process and doesn’t always look like what it is. For example, friendly fraud attempts don’t look like criminal transactions on the surface, but with the proper data, one can spot a dishonest attempt at a chargeback.
By contrast, not everything that looks like fraud actually is, Sevounts said. A deeper look into the entire consumer journey will often turn up operational inefficiencies that are actually creating chargebacks.
“These are places where a product description is bad or wrong, the customer service phone number is not easily findable or the email address for consumer complaints is either wrong or no one is monitoring it,” he said. “There is a variety of these types of inefficiencies, and diving into the data gives merchants an opportunity to identify and address them. Not only does it significantly reduce chargebacks, but it also helps increase conversions in general by improving the commerce experience.”
At the end of the day, Sevounts noted, merchants across the board are working around the clock to make sure they’re ready for the holiday season — even if the specifics of what they face are still emerging. Given the complicated and difficult year many merchants have already had, it’s especially important to have things go right over the holidays.
And things can go right, but only if merchants are prepared to retool their journeys around omnicommerce and reorient themselves to consider the whole consumer experience end to end, Sevounts said.
“The last thing they want after all the effort they put into getting inventory, selling it and providing a great digital experience and journey is to see any of those transactions reversed because of crazy, illegitimate concerns or other security shortfalls,” he noted.