TECHNOLOGY

Study: Digital sales drive fraud transaction volume

BY Deena M. Amato-McCoy

Fraud volume has risen sharply in the last year — an issue that’s being blamed on online channels and sales of digital goods.

Online fraud is outpacing e-commerce sales volume as the monthly average of fraudulent transactions jumped from 206 to 238 incidents, according to LexisNexis Risk Solutions’ report, “2017 True Cost of Fraud.”

While prevented fraudulent transactions have increased from 236 to 257, the level of fraud as a percentage of revenues has also inched upward from 1.47% to 1.58%. Every dollar of fraud cost merchants $2.77, up from $2.40 a year ago.

Online channels and sales of digital goods, particularly international transactions, are the biggest culprits of fraudulent transactions. When it comes to the cost per dollar of fraud, merchants with international transactions have significantly higher incidents than merchants with domestic-only transactions. This coincides with the rise in account hacking and takeovers, the study reported.

New access channels and payment methods, including mobile wallets, the EMV rollout in the United States, and digital channel applications are also making the regulatory and payment landscape more challenging for merchants, according to the report.

Other findings include:

• The loss incurred among merchants with digital and physical goods has increased 63% since last year, rising from $2.18 to $3.56.

• A slight drop in debit card fraud was reported among e-commerce and m-commerce merchants, likely the result of chip/PIN use. However, credit card fraud remains high, with debit card fraud remaining high among merchants selling both physical and digital goods.

• When discussing the top three challenges that retailers are facing, identity verification remains the highest for the online channel. However, top mobile channel issues vary, suggesting there is more complexity in this channel.

“With online fraud outpacing reported growth in e-commerce sales volume, we can point to EMV implementation at physical retail stores as a cause,” said LexisNexis Risk Solutions VP of fraud and identity management strategy, Paul Bjerke.  “Also in the digital space, botnet fraud also has risen dramatically, which correlates with the rise in e-gift card volume and fraud.”

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TECHNOLOGY

The drivers influencing where consumers shop for groceries are…

BY Deena M. Amato-McCoy

Shoppers may not be loyal to specific grocery brands, but they are partial to those with the best price, quality, availability and convenience.

Whether shopping online or in-store, consumers want options when it comes to where they purchase their everyday groceries and supplies, according to a report from Acosta. Not only are customers hopping from brand to brand, 76% of weekly shoppers visit more than one retailer each week for groceries, according to” a report from Acosta.

The study, “Trip Drivers: Top Influencers Driving Shopper Traffic,” revealed that 67% of shoppers visit approximately between two and three retailers weekly. But they are not just hitting random brands. Instead, they will only do business with companies that offer the best prices, quality, availability and convenience.

For example, when it comes to price, 60% of consumers reported shopping at more than one retailer because “some products are priced lower at certain retailers.” Only 45% of millennials cite price as a key driver of retail hopping – this generation is more prone than the average shopper to vary their shopping based on where they are and specific brands.

However, more shoppers are choosing which store to shop based on how much they like the store brand (53% of shoppers versus only 34% in 2011).

Fresh food is also driving grocery store trips, especially as many time-starved shoppers are visiting stores in search of that evening’s dinner. When it comes to weekly shopping trips however, 37% of shoppers make multiple trips weekly to ensure their food is fresh.

From old to young, each generational group makes multiple trips or receives multiple deliveries to stay stocked with the freshest food. This includes millennials (65%), GenXers (47%), boomers (25%) and Silents (22%), or those born between the mid-1920s to the early-to-mid 1940s.

Fruit (31%) and deli-prepared foods (29%) drive most of fresh food’s dollar growth, respectively.

Brands can help establish a loyal shopper following by delivering innovative products that align with consumer demand, and by consistently delivering quality, valued products to develop a level of trust. For example, 41% of consumers shop at more than one retailer because “some retailers carry better quality products in certain categories.”

Meanwhile, 33% of shoppers go to more than one retailer due to not finding all the products/brands they want at one store.

Brand preference drives traffic across all income brackets, including among 37% of shoppers with household incomes above $199,000, and 28% of shoppers with household incomes below $20,000. Forty-three percent of shoppers said that brands simplify the selection process when shopping at multiple grocery stores, according to the study.

“Shoppers appreciate having options, which is why we are seeing a rise in hopping from store to store for weekly grocery trips,” said Colin Stewart, senior VP at Acosta. “People are motivated by not only good deals and fresh products, but also by brand loyalty, which can impact their decisions to either keep returning to a particular store, or hopping to another.”

According to the study, personalization is another key strategy in connecting with shoppers and creating not only brand loyalty, but also store loyalty. “No retailer can be everything to everyone, but by knowing what motivates your shoppers, whether it be price, fresh foods or brands, make a commitment to the satisfaction of your shoppers to keep your location in their shopping mix,” added Stewart.

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TECHNOLOGY

Adobe: Holiday season ringing up $1 billion online daily

BY Deena M. Amato-McCoy

Thirty-five days in, the 2017 holiday shopping season has already generated $65.15 billion.

Every single day (35 in all), holiday shoppers are spending over $1 billion in online revenue, volume that is on pace to make the 2017 holiday season hit a record $107.4 billion. This accomplishment will make the 2017 holiday shopping season the first to cross the $100 billion mark, according to Adobe Analytics.
Mobile shopping remains strong and is contributing to this growth. Mobile represents 48.8% of visits (40.3% smartphones; 8.5% tablets) and 32.4% of revenue (22.3% smartphones; 10.1% tablets).

When diving into the most purchased merchandise, post-Thanksgiving, the top products include Apple AirPods and iPads, laptops (Dell, Lenovo and HP), Amazon Fire TV and Samsung tablets in electronics; Hatchimals & Colleggtibles, PJ Masks, Baby Alive and Little Live Pets in toys; Super Mario Odyssey and Pokemon Ultra Sun/Moon in video games; Xbox One X and Nintendo Switch in gaming consoles; as well as vacuum tumblers.

Additional findings include:

• Discounts: While the best deals were seen during the Thanksgiving shopping weekend, shoppers can still find good deals on TVs (prices down 15.0% since October 1), computers (down 13.1%) and toys (down 15.0%).

• Conversion rates and average order value (AOV): Season to date, conversion rates are showing growth: desktop 4.5% (up 10.6% YoY), smartphone 2.0% (up 12.3% YoY), tablet 4.3% (up 9.3% YoY). AOV is $130, slightly lower over the same time last year (down 0.6% YoY).

• Marketing channel impact: For the season thus far, search retained the top spot when it came to share of sales for retailers (23.0% paid; 21.5% natural). This is followed by direct traffic (26.6%), email (19.8%), shopper helper sites (6.1%), display (1.8%) and social (1.2%).

“Following a blockbuster Thanksgiving weekend that broke all records, online spending remained strong as consumers look to the Christmas holiday,” said Taylor Schreiner, director, Adobe Digital Insights.

“Whether it’s shopping on a smartphone or returning to a desktop at work, consumers are pros now at finding the best discounts and closing deals quickly online,” Schreiner said. “With every single day since the beginning of November raking in over a billion dollars, we are well on track for the holiday season to make history and cross the $100 billion mark in online spending.”

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