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Don't let your leads get treated like fraudsters

Online criminals love to mimic good customer behavior - which can lead to genuine shoppers being turned away.
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Are You Turning Good Customers Away?

You've invested time, thought, energy and love into bringing the right leads to your site. You've done a great job - they want to convert. But something stops them, right as they're handing over their details to pay. It's fraud prevention. 

It's not something marketing professionals typically think about, but in the interconnected world of e-commerce your conversion results will be directly affected by the accuracy and sensitivity of the fraud prevention system your site relies on.

Matching The Buyer Persona to the Fraudster Persona

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What it comes down to is the fact that it's often difficult to tell difference between fraudsters and genuine customers. Online criminals are shrewd psychologists and they carefully tailor their behavior to be most convincing for whatever industry they're attacking. 

Take a look at the types of fraudster discussed in this 'Profile of a Fraudster' ebook, and see if you can match them up to buyer personas you've created for your own desired customers. You'll start to see why your site's fraud protection system might be getting it wrong, and turning away shoppers whose behavior looks a little suspicious simply out of an over-abundance of caution.

Predicting Fraudsters is Harder Than Predicting the Weather

Not that predicting the weather is easy, or no one would ever get caught without an umbrella when they needed it. But the weather doesn't fight back. Fraudsters do, all the time. They're highly creative, always coming up with new ways to search for and exploit weaknesses in an e-commerce site.

Most fraud protection systems struggle to keep up with this level of innovation. They rely on rules, which are too rigid to adapt fast enough to this dynamic environment, and on manual reviews, which is when a transaction is flagged as suspect and gets sent to a human for investigation. This isn't ideal for accuracy, since manual reviewers are naturally biased by their own experiences and preconceptions, and it's time-consuming. 

Moreover, many systems focus only on the point of transaction. That's important, of course. But it's only a part of the story. Customers interact with merchants at multiple points of the consumer lifecycle, and a solution that doesn't make account level interactions a fundamental part of the picture being built up of each customer is failing in today's changing environment.

The Customer Experience Impact

Manual reviews take an average of 5 minutes per transaction. Not only does that mean that the reviewers are constantly under pressure to run through orders, leaving little time for research into new fraud trends, it also has a negative impact on customer experience. No matter how much they love your brand, they're unlikely to wait hours or even days for an order confirmation. They're far more likely to go elsewhere.

This problem is only exacerbated during sales and holiday seasons. It doesn't matter how compelling a campaign you run, if customers don't feel confident that they'll get their goods in time for the holiday or before the sale ends they won't wait to find out what's going on; they'll try a competitor. 

Then there's the worst customer experience of all: rejection as a false positive. There's a reason that the industry sometimes refers to this as "the insult rate." No customer likes having their order declined as fraud when all that's really going is that they have a slightly more complex buying story than average. If they're shipping to an address that doesn't match their billing address, or they're traveling, or they're using a new device, that alone might be enough to mean they can't complete their purchase. 

All of these issues are only made more problematic whenever you enter a new market, since customers in every market behave a little differently, and fraud prevention systems are often not calibrated to deal with these differences. 

Emphasise Customers' Accounts

Legacy solutions (and even many younger ones, including those which incorporate some element of machine learning and provide decisions) fail to view the customer journey, which may be across channels, days and browsers, as a unified whole.

This means that their systems will always have a restricted understanding of customers and their behaviors, which in turn reduces the accuracy of these types of legacy solutions. It also puts undue emphasis on the point of transaction. While important, a focus on transactions does not protect the rest of the consumer lifecycle.

Businesses today, whose marketing teams invest in driving consumer loyalty and affection, cannot afford a solution which ignores key elements of customers’ interactions with their site and apps. Account takeovers, for example, must be identified very early on and not only once an account is used to make a purchase. The alternative risks losing customers’ trust.

Other account abuses such as coupon abuse or referral abuse are also marketing painpoints that fraud protection can and should be helping to identify and prevent. Yet in most companies, it's failing to do so, and the marketing dollars that are spent on cheating customers are undefended.

Take a Seat At the Table

Don't let yourself get held hostage to fraud considerations: point out your stake in the issue, take part in the discussion and play a role in the process. You'll need:

  • Knowledge – Don’t be afraid of the “F-word.” Get a general understanding of the fraud prevention world and its impact on your results. There are many great resources out there that can keep you up to date with the latest developments so that the next time the issue comes up, you’ll know exactly what you want.
  • Holistic strategy – More and more organizations are beginning to understand that fraud prevention is a part of an overall business strategy. Become more involved in the discussion and demand to take part in the decisions that are made in this space since they have a direct influence on your metrics and results.
  • Business-Focused solution – There are many fraud prevention solutions. Don’t use the ones that are killing your conversion rates and chasing your consumers straight into the arms of your competitors. Make sure that your company selects the fraud solution which is aligned with your business needs and culture.

 

What You Need

Companies will benefit most from a fraud prevention solution that's accurate, rather than risk-averse. That way you can be confident that fraudsters are being turned away while good customers are unaffected. Fraud protection should be invisible to genuine buyers, as well as effective at stopping fraudulent ones.

It's also important to ensure that your fraud prevention is taking the whole of the customer lifecycle into account, analyzing every customer touchpoint, not just those at checkout, and offering protection against multiple forms of account abuse. 

Forter can help. We offer:

  • Account level insights and protection
  • Notification of account takeover and account abuses at every stage of the customer journey
  • Real-time fraud decisions for every transaction
  • An "innocent unless proven guilty" approach that maximizes approvals and minimizes false declines
  • A system that is updated multiple times a day, and sensitive to the nuances of different geographies and markets

Fraud prevention shouldn’t be a goal in itself; it is a means to an end, and that end is company growth. By becoming part of the fraud prevention discussion, marketing professionals can make sure that company growth is always front and center, and that fraud prevention policies and solutions don’t limit growth, but rather promote it.