Omnichannel ecommerce is driving the future of business with its fast growth rate and consumers’ large-scale approval, but it’s also exposing brands to greater fraud risk.
In recent years, multichannel ecommerce has been gaining popularity as brands strive to provide a consistent purchasing experience. Now that various payment methods are also available, we know that this trend is here to stay.
By 2017, cross-channel retail sales may reach up to $1.8 trillion from $1.2 trillion in 2012, according to a report published by business and tech research firm Forrester. Online shoppers enjoy plenty of benefits with multichannel buying, as it’s fast, convenient, and flexible. This hassle-free process even motivates them to spend more than what they’d normally shell out in single-channel and in-store transactions.
Brands are aware of these promising opportunities. As a result, they’re trying harder to meet people’s demands for multichannel availability in addition to in-store interactions. They’re embracing mobile and desktop platforms while improving customer service in order to make seamless journeys possible.
However, this increase in the number of access points between brands and consumers exposes retailers to a greater risk for fraud. Now that business owners manage multiple touchpoints, the risk management process has also become more complex. Here are the main challenges that brands have to deal with when combating fraud across various points of sale.
• Building a cross-channel fraud detection strategy
|Different types of fraud take place in each touchpoint, and therefore, different prevention techniques must also be used.|
When it comes to ecommerce, fraud can mean a lot of things, including fake payment details, stolen credit card numbers, and refund or promo abuse. Different types of fraud take place in each touchpoint, and therefore, different prevention techniques must also be used.
Because of this, it’s not surprising that many retailers find it hard to create a comprehensive and well-consolidated plan for fraud detection and management. Some brands may start by creating separate strategies for each channel, but integrating them to capture the omnichannel retail process is the real challenge.
• Monitoring transactions
Through omnichannel ecommerce, customers are able to start and end purchases using multiple platforms. They may browse product catalogs on their phones, transfer to the desktop to load up their carts, and then pick up the phone to ask for delivery updates.
Fraud analysts must be able to follow this multichannel path to find and verify suspicious information. Brands thus need to have effective tools that would let them capture and organize all pertinent data given by customers via different touchpoints. In this case, customer relationship management apps and tools for data analytics have an important role to play.
• Designing training programs for fraud analysts
Fraud analysts aren’t just people with superb tech skills, although a thorough know-how about various touchpoints is non-negotiable. Aside from this, they also need to analyze information and pay keen attention to small details. These aptitudes would let them perform various sub-tasks involved in fraud analysis such as moderating user-generated content on websites and social media, investigating customer transactions, and validating payment details.
It can be challenging to design a training program that places the right amount of emphasis on each of these key skills. On top of this, fraud analysts are expected to be able to make smart decisions independently, as any mistake they make can be costly for the organization.
• Aggregating and analyzing data
The backbone of effective business risk management is a well-thought out data aggregation and analysis approach. When retail brands are able to fully interpret the fraud-related data they have, they gain a lot of useful insights. It becomes easier to uncover any arising patterns, style, and techniques that cybercriminals use across multiple channels. This way, brands will be in a better position to guard themselves against fraud.