Time to prevent fraud without impacting on the customer journey

By Barley Laing, the UK Managing Director at Melissa

The growth in ecommerce due to the lockdowns, better technology and the recognition amongst shoppers of the convenience it provides, is good news for the retail sector. However, it also creates a headache for retailers. Why? The upward trend in ecommerce sales has led to an associated increase in fraud. 

Online retailers, as a matter of urgency, need to protect themselves against fraud, but at the same time ensure that the ID verification tools they use don’t impact negatively on the customer journey.

In a highly competitive ecommerce sector with so much similarity in the quality and price of products on offer, it’s critical that vendors deliver a standout experience to ensure happy customers.

Any process that slows down or complicates the online customer journey will be very damaging for the merchant and could cause them to lose customers and therefore revenue - a big issue particularly in these challenging times.

To prevent fraud and deliver a seamless customer journey undertake electronic identity verification (eIDV)

The fastest, most accurate and cost-effective way to deliver ID verification online, and therefore help stop fraudulent activity, is to embrace electronic identity verification (eIDV). One of the most vital aspects of eIDV is its role in preventing fraud in real time at the point of customer access online; thereby ensuring retailers are dealing with the person they think they are. eIDV is able to deliver this by making cross-checks in real time against the data provided by the shopper – such as their name, address, phone number, email address and date of birth. However, to do this effectively the eIDV tool needs access to billions of global records in real time.

For retailers, it’s the real time automation of cross-checks with eIDV that is of great importance. It’s this which makes it possible to deliver a seamless customer journey, and therefore help to provide a standout customer experience.

Integration of eIDV into existing online platforms is straightforward, because it’s delivered through apps, SaaS, and web APIs. eIDV can also easily be scaled up, delivering as little as 100 checks per year through to many millions, if required. 

Combine eIDV with an address verification system (AVS)

To further ensure a standout customer journey while helping to stop fraud it’s important that retailers, in conjunction with eIDV, use an automated address verification system (AVS). Provided by major credit card processors and banks AVS enables merchants to authenticate ownership of a credit or debit card used by a customer, in real time. With this service the credit card company or issuing bank automatically checks the billing address provided by the customer to the retailer against the billing address in its records, and reports back to the merchant. Using this information, in real time, the vendor can stop purchases made by unauthorised users.

Automation avoids time consuming and costly manual checks

Because eIDV is an automated process retailers avoid having to undertake time consuming and costly manual checks which would otherwise need to take place. The fact that the manual approach is very time consuming is not good for delivering a standout customer experience. Also, with physical checks, the ID verification process is prone to human error.

Address autocomplete prevents fraud and provides a standout customer journey

Fraud prevention should not start and finish with eIDV. To help stop fraud and deliver a standout customer experience simple data quality practices are important. A good one to use is an address autocomplete or lookup service which makes sure only deliverable and verified addresses enter your system. These tools automatically reveal a suggested correct version of the address as the customer starts to type their contact details into an online contact form. It thereby enables them to select one that’s not only accurate but easily recognised, and correctly formatted for their country location, in real time. They also prevent mistakes caused by fat finger syndrome, by reducing the number of keystrokes required when typing an address by up to 81 per cent. The faster checkout aids the delivery of a standout customer journey, reducing shopping cart abandonment.

Using tools such as an address lookup service to deliver accurate and verified customer data ensures communications are efficiently delivered to provide a good customer experience - avoiding the dreaded and expensive mis-deliveries. Additionally, once you know you have accurate customer contact data it can be effectively analysed to gain valuable insight that can be used to keep existing customers happy. An important part of this is the ability to deliver highly personalised communications to customers.

With little differentiation in price and quality online it’s those retailers that seek out the technology that gives them the edge over rivals in terms of the customer journey and experience. When it comes to the growing issue of fraud it’s vital that retailers use those tools, such as eIDV, that ensure the customer journey isn’t impacted when undertaking the necessary ID checks. They should also go further by adopting simple data quality practices, like address autocomplete, to reduce the opportunity for fraud and improve the customer experience.

By Barley Laing

07/09/2021

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