Ecommerce fraud is a global problem. On that, everyone agrees. But new research from Riskified shows that merchants and consumers don’t see eye-to-eye on a key issue in fraud prevention. Consumers are not particularly confident in merchants’ ability to combat fraud.
To measure the gap between how merchants and consumers view fraud prevention, Riskified conducted a survey among 4,000 consumers and 400 retailers across the US, UK, France, and Germany. We found that the confidence disconnect is a worldwide problem for eCommerce merchants, but that it varies country to country.
Our latest report, A Crisis of Confidence, presents the findings from our research at the global and regional level, and provides guidance on how merchants can confidently manage fraud without alienating consumers. Here are some of the report’s key findings:
A Loss of Faith
Too many consumers have been the victim of fraud in the past year and it’s wearing down on their confidence in merchants. As many as 1 in 5 global consumers have experienced online shopping fraud this year and up to 40% of them blame the merchant rather than the fraudster. Customers are so dismayed by having their data or credit card details compromised that 2 in every 3 respondents said they wouldn’t shop with the merchant again.
Not many consumers are confident in a merchant’s ability to manage fraud – just 34%. It’s not just past incidents that are causing this lack of confidence – it’s also a concern about the evolution of fraud. As many as 1 in 2 consumers surveyed believe that retailers will have more trouble preventing fraud as fraudsters get more sophisticated in the future.
An Air of Resignation
While just over a third of consumers answered that they were confident in the merchant’s ability to manage fraud, that figure was almost double for merchants. Despite having greater confidence in themselves than the consumer does, merchants acknowledged that fraud is growing and hurting their business. For example, 69% of US merchants and 50% of German merchants expect fraud to continue to rise over the next year.
Several merchants surveyed also shared that they are losing 5% or more of their annual online revenue to fraud, from promo abuse to CNP (card-not-present) transactions. And yet, in countries like France and Germany, less than half of merchants were using solutions to protect consumers from account takeover attacks. With fraud only expected to increase, it seems that some merchants feel hopeless.
Download The Report
These are just some of the findings from our recent study on consumer and merchant perceptions on fraud prevention. For more insights and fraud management strategies, download a complimentary copy of the full report.