CNP Expo: Order Analysis – Manual Reviews = More Profits

May 20, 2014

CNP Expo: Order Analysis - Manual Reviews = More Profits Companies are struggling to reduce the number of card-not-present orders they review manually in order to speed products to customers. Online footwear retailer Shoe Carnival found a way to be more selective and accurate in deciding which orders to review. The company is losing fewer customers since it has stopped delaying shipments by being more selective in reviewing orders.

“They went to our competitors before,” Chris Logel of Shoe Carnival said in a morning session at the CNP Expo in Orlando, Fla. today. “We went from a 12 percent review to 4 percent (manual review) and had a minimal impact on our chargebacks.”

Most companies are moving to automated reviews of online orders. And, panelists said flexibility is important for companies that continue to do the job manually.

“We run hard business rules,” said Chance Bowlin, corporate loss prevention manager for Petco Animal Supplies. “We are seeing a lot of good orders in there, running these kind of rules.”

Automation, which matches information from the card account to other sources, can reduce the dependence on human intuition, which is not effective.

“When we did automate, we started serving up the orders to our [fraud] agents based on risk score,” said Paul Mazerac, manager of loss prevention for the Walt Disney Company.

One company found that temporary security workers hired during seasonal peaks make a lot of mistakes.

“Experience is important for agents,” said Tracy Stack, a loss prevention executive with high-end audio retailer Crutchfield Audio. Stack added that the company tries to catalog its failures in the manual review process and learn from them. “We develop an in-house flow chart to give agents an idea what to do,” she added.

Bowlin said his company studies what the agent does and how many chargebacks they fail to stop.

“We reverse engineer every chargeback,” said Bowlin, who added that he believes chargebacks can, and will, be reduced. “I think it comes down as technology improves.”