Shoplifting is not something we haven’t heard of, and unfortunately, it is becoming an ongoing trend in merchandise business, it is something that retailers have faced for a long time. But over the last decade, vendors have had to deal a different type of shoplifting. Have you ever heard of cyber-shoplifting or friendly fraud? We know it sounds all fancy and techy, but it’s actually a merchant’s nightmare.The idea came from people instead of using fake name use their real identity and buy some product online and then dispute their purchase with their credit card and asking for a chargeback, even after getting what they actually wanted.
Cyber Shoplifting Explained
Let me explain how this works, Assume that a customer makes a purchase online from a vendor. The consumer waited patiently for weeks and weeks, but the item never arrived. Calling and emailing the merchant recurrently but to no answer whatsoever. What do you make of that? Definitely, you think that the consumer has been cheated. Fortunately, there is an alternative. The buyer can communicate with the bank and ask for or better termed as demands a chargeback, which means that the bank will compulsorily take the money from the seller’s bank account and hand it over to the customer. Unfortunately, chargebacks have turned into a weapon of fraudsters in modern times.
Take the example I just gave you with a few variables changed. Supposedly, the consumer did get the item but is now experiencing buyer’s regret. In a desperate effort to get compensation, the customer files a dishonest and illegitimate chargeback, claiming that the product(s) was never delivered in the first place.
Shoplifting impacting Merchants
Many years ago stores didn’t have CCTV cameras and guards for security. In fact, customers had a privilege, stores providing 365-day return policies – just bring back the product you purchased and you will get a refund then and there.
Unfortunately, these privileges were misused, and the rest is history. An online merchant has to tackle the exact same challenges when coming across this type of abuse. The only difference being is that they are less sophisticated with protecting themselves due to their maturity in the evaluation. When cyber-shoplifting takes place, a merchant loses their products, the deal, advertising charges, overhead charges, and their accountability in terms of fee processing is increased as well.
How to Prevent Cyber Shoplifting?
The trend of cyber-shoplifting is only anticipated to grow with time, which means that vendors will need to take benefit of other fraud-fighting techniques to stay ahead of the felons. Additional methods to fight against cyber- shoplifter’s activity is going to be particularly important as mobile wallets are becoming immensely popular.
There are many different and unique approaches through which a business might get an edge in fighting this new form of fraud.
- Correctly reveal the terms of service and return policy.
- Offer 24-hour customer service.
- Use precise and easily identified billing descriptors.
- Offer refunds on time.
- Identify potential frauds which are classified as “High Risk” by using some sort of filters, manually.
- Cyber Shoplifting cannot be fully minimized, but a vendor must provide training and introduce some practice which will possibly help in minimizing your risk.