Lax return policies and lenient fraud prevention are fueling a surge in ecommerce fraud, burdening consumers with higher prices and diminished trust in online shopping.
Lax return policies and lenient fraud prevention measures are fueling a surge in ecommerce fraud, ultimately burdening consumers with higher prices and diminished trust in online shopping .Ecommerce has transformed the shopping experience, turning living rooms into fitting rooms and checkout counters into a few clicks. But with this convenience comes a cost, and not just for retailers. On average, retailers estimate that 16.
Indeed, the sophistication of abuse has skyrocketed. Riskified’s report says that more than 84% of merchants admit identifying fraudulent activity has become harder, while 76% say policy abuse is growing increasingly sophisticated. "Fraudsters are no longer operating in isolation. They exchange strategies and adjust in real time, making it incredibly challenging for retailers to stay ahead," says Gal.It’s easy to dismiss this as a retailer problem, but the truth is, everyone bears the cost. Fraudsters steal more than products—they siphon away resources that could improve customer experiences.
Underlining all of this is the simple fact that policy abuse is inherently tricky to identify. Fraudulent claims often resemble legitimate ones, forcing merchants to sift through vast amounts of data. The internal complexity—spanning customer service, logistics, and finance—further complicates the task. According to a Riskified report, 67% of merchants struggle with inadequate collaboration between departments, leading to silos that fraudsters are quick to exploit.
Implementing tailored policies, such as sliding-scale return options based on customer loyalty and purchase history, strikes a balance between protecting profits and rewarding loyal customers.
Post-Pandemic Consumer Machine Learning Ecommerce Fraud Customers Return Policies Diminished Trust Online Shopping
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