by Haleakala (NS8)
As an ecommerce jeweler, you’ve probably noticed the rising trend in online shopping. In fact, ecommerce sales will reach over $630 billion in 2020 per Juniper Research. While more customers are great for your business, it’s also a good time to focus on how to keep your customers safe. As online sales increase, so does the potential for fraud. Juniper predicts that 65% of all online sales this year will be fraudulent.
With both ecommerce and fraud on the rise, you want to protect your jewelry store and your customers. There are great tools you can use to help keep your store safe, your customers safe, and increase your bottom line. Turn your focus to approving legitimate orders and keep your customers coming back. Learn how to defend your store from fraud and provide a secure, positive customer experience. Knowing why your ecommerce jewelry store is a target for fraud is the first step to discovering how to protect it.
Challenges for ecommerce jewelers
When it comes to types of online fraud, you have different challenges than other ecommerce stores. As a jeweler, your price points are higher than other online retailers. Therefore, even one fraudulent order can have a significant impact on your business. Unfortunately, you’re also a target. Fraudsters go after your inventory because it’s easy to resell, inexpensive to ship, and in high demand.
In addition, your peak sales seasons are the same as when fraud is at its highest. As a jeweler, your sales are typically highest when customers want luxury purchases for special occasions. Holidays like Mother’s Day, Christmas, and Valentine’s Day bring you more traffic and attract fraudsters. While there are many types of online transaction fraud, the most prevalent for online jewelry retailers are chargeback fraud and false declines.
According to the news site PYMNTS, the jewelry industry has the highest number of chargebacks for orders under $100. For orders over $500, chargebacks average over $2,000 each.
These numbers are concerning, especially because fighting chargeback fraud can be very difficult. Chargeback fraud, also known as friendly fraud, is when a customer makes a purchase online using their own credit card. Then, the customer claims that they didn’t receive the item and successfully disputes the charges.
Chargebacks also occur when a fraudster uses a legitimate customer’s credit card to make a purchase. In this scenario, the customer did not place the order or receive an item. To help avoid both chargebacks and chargeback fraud, make sure your customers are placing their own orders. For more security, use two-factor authentication to make sure your customers verify the order.
Another way to reduce chargebacks is to communicate clearly with your customers. Let them know what to expect on their statements when they make a purchase from your store. Avoid confusion and build trust to retain your customers and keep them coming back.
False declines happen when a legitimate customer is rejected for suspected fraud. These can result in losing current and future customers. To make sure orders are valid, follow up with your customers. You can also help reduce false declines by using a flexible, customizable fraud prevention system. False declines often happen when:
- Customers make purchases while they’re out of their country of origin.
- Return customers make a purchase that’s much higher than they have in the past.
- Ecommerce stores fail to verify purchases.
- Online fraud prevention tools block all potential fraud.
It’s important to balance fraud risks with your increasing revenue. The right fraud protection software can help you do both by detecting your valid customers. Customize your fraud prevention software to monitor your customers’ buying patterns and verify orders. This will help reduce chargeback fraud and false declines while keeping your bottom line healthy.
Help protect your ecommerce store and your customers
Giving your customers a safe, secure way to buy online will keep them coming back. Protect your business by making sure that each transaction is secure and legitimate. To do that, look more closely at orders that request expedited shipping. Implement ways to verify order information, including a customer’s address, order information, and credit card information. Don’t be afraid to ask follow-up questions or reach out to a customer when needed. Most customers prefer knowing their information is secure and that you have protections in place for them.
Finally, consider your fraud solution. Many ecommerce jewelers use automated fraud protection software to solve many needs at the same time. Effective fraud prevention software can help you detect high-risk transactions, verify orders, and more. With the right software, you can:
- Set risk thresholds that make sense for your ecommerce jewelry store.
- Learn more about your customers and monitor their order patterns.
- Assess risk in near-real time to help reduce fraud.
- Check IP addresses and other static data.
- Increase your bottom line without blocking legitimate customers.
Learn how NS8 can help boost your revenue by protecting your ecommerce jewelry store against fraud. Request a free demo.