Online scamsbecame the realsilent enemy duringthe peak seasons in retail. Throughout Black Friday 2024, which marked the start of the holiday shopping season, while consumers took advantage of irresistible promotions, fraudsters also capitalized on the shopping wave to attack with greater intensity and sophistication. According to data from theSignifyd, anti-fraud company for e-commerce, categories such asluxury, beautyandfashionrecorded increasesimportantin fraud attempts.
The beauty sector has seen a 43% increase in fraud attempts over the past year.Cyber Weekend(Friday, Saturday, and Sunday), compared to last year. Infashion, the volume of fraud increased on Friday, but decreased in the following days. In the luxury sector, the number of fraud attempts reached peaks of 3.5 times higher compared to the previous year during Black Week.
And what does this mean for e-commerce? First, that thefraudstersThey take advantage of the periods of increased e-commerce sales volume so that frauds go unnoticed. Secondly, they also take advantage of discounts to gain even more benefits through fraud, and third, but perhaps more importantly, they invest in and diversify their tools more and more to commit fraud in a wayfaster and more efficient.For retailers, this means the race to identify and block these scams has never been more urgent.
Failing to look at rising fraud is costly
The focus of preparation for peak sales seasons, such as the end-of-year period, begins months in advance and is an opportunity to maximize sales. However, a mistake that can be costly is forgetting that these periods also serve asfertile ground for fraudsters, who know that the shopping frenzy can create better opportunities for scams.
The numbers observed on Black Friday become valuable information for retailers throughout the year, but they take on more significant proportions during sales peaks. For example,luxury, beautyandfashionwere the most targeted categories throughout Black Friday 2024, precisely becausehigh value of products and their ease of resale.
Without a proactive fraud prevention strategy supported by agile tools like current fraud schemes and protection guarantees, the increase in sales at the end of the year can also result in a significant rise in losses caused by fraud, not only through chargeback costs but also administrative costs to handle disputes and the fees involved in these processes.
The solution lies in quick intelligence: preventing before losing
As fraud networks evolve with more sophisticated tactics and resources to operate more quickly, protection tools must be equally agile and intelligent. Third-generation anti-fraud solutions have led a change in the market withprevention technology based on artificial intelligence and machine learningthat not only identifies fraudulent patterns, but also anticipates threats before they cause damage.
“Fraud attempts during peak sales seasons are increasingly fast, organized and audacious. Busy periods in e-commerce are particularly targeted by fraudsters due to the significant increase in transaction volume. The key to maintaining profitability is to adopt a proactive and immediate anti-fraud approach,” says Gabriel Vecchia, commercial director at Signifyd, a company that offers a third-generation anti-fraud solution.
Fraudsters don't sleep
While brands focus on increasing their sales, fraudsters areready to attack. What sets apart businesses that are successful in combating fraud from those that face huge losses is the ability toreact quickly, evolve constantly and ensure revenue protection.
"E-commerce cannot delay or hesitate in identifying fraud; nor should it bear this responsibility alone. Proper use of technology not only provides the ability to block fraudulent attempts in real time but also ensures that damages caused by fraud do not affect the financial health of the e-commerce; in the third generation of anti-fraud solutions, this becomes the provider’s responsibility," completes Vecchia.
In front of thepeaks in fraudulent attempts in segments with high average ticketsDuring the holiday sales, Signifyd reaffirms the importance ofartificial intelligenceas a vital tool for e-commerce businesses to protect their operations against fraud and the damages they can cause.
“Attempting to commit fraud during times like the Christmas shopping season is like fishing in a full tank – and fraudsters know this. Our mission is to ensure that online commerce continues to grow, taking advantage of every opportunity to sell more, with the peace of mind of having guaranteed protection that effectively takes responsibility for fraud – which is only possible with the massive use of advanced technology,” concludes Vecchia.
