TECHNOLOGY

Study: Online retailers at risk of losing $2.1 billion this holiday season

BY Deena M. Amato-McCoy

More unauthorized product ads are hijacking the consumerexperience — an issue that will cost retailers precious revenue this holiday season.

As unauthorized product ads are injected into consumer browsers — and appear on retailer sites — consumers are distracted from the retailer’s offerings. This disruption – known as online journey hijacking – cuts directly into retailers’ revenue, an issue that could cost companies $2.1 billion this holiday season.

This was according to “The Impact of Online Journey Hijacking on E-Commerce Q4 Sales in the U.S.,” a report from Namogoo.

According to the study, 15% to 25% of all e-commerce customer sessions are exposed to unauthorized ads while browsing retailer sites, and this could increase to 20% to 30% of all sessions during peak shopping seasons. In addition, 80% of the displayed ads during peak season are competitive product ads, sending a retailer’s traffic directly to its competitors.

Meanwhile, hackers are sharpening their malware just in time for the holiday season. Specifically, malware developers are pulling out all the stops to increase their reach and optimize their ads to generate more clicks and revenue, there report said.

As the holiday season heats up, online journey hijacking will likely remain steady at the 15% to 25% in September/early October, and increase exponentially during busy shopping periods such as Black Friday, Cyber Monday and Christmas.

“Amazon isn’t the only threat to retailers this holiday season. Online journey hijacking is a serious issue for online retailers, not just from a revenue standpoint but also in terms of brand experience and loyalty,” said Chemi Katz, co-founder and CEO of Namogoo. “The amount of lost revenue resulting from such tactics is astronomical and can be devastating, particularly at such a pivotal shopping time as the holiday rush.”

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