November 2, 2017
Merchant preparations for the holidays are coming to a head and, while fraud rates actually tend to go down during the holidays, as a raw number, fraud attacks are expected to increase again this year, according to antifraud technology provider Kount. In its Merchant Holiday Retail Guide, the Boise, Idaho-based company details some of its merchants’ experiences from last year so others can be more prepared for this year.
During the 2016 holiday season, while Kount merchants experienced the biggest increase in online sales on Black Friday (189 percent more transactions than 2015), it was Cyber Monday that saw the biggest increase in fraud attacks (134 percent more than 2015). For the entire holiday season last year, online sales for Kount merchants increased 148 percent and fraud attacks were up 122 percent. And, of course, the chargebacks that resulted from that fraud only became apparent when the calendar turned to 2017.
“Our data shows that chargebacks seen in Q1 are a huge problem for merchants, and one that will only to continue to grow if retailers don’t get a handle on their fraud problem,” said Don Bush, vice president of marketing at Kount. “Chargebacks reports are included in calculating our average fraud attacks, which spiked in Q1 2017 due to holiday fraud from the previous quarter. Q1 2017 reporting showed an increase in fraud among all device types over what was seen during 2016’s holiday retail quarter.”
In addition to various fraud benchmarks (e.g., desktop transactions are the riskiest and mobile browser transactions are twice as risky as mobile app transactions), Kount’s guide lists some best practices merchants can use to get through the holidays.