How Skullcandy eliminated manual review and chargeback risk, to safely sell awesome headphones all around the world
100%reduction in manual review costs
7%increase in approval rates
Rick Alden founded Skullcandy in 2003 with a simple idea: headphones should look great, sound great, and be affordable. Today, Skullcandy’s products have become a cultural icon, prized by extreme athletes and indie musicians alike – and their Astro headsets have become a favorite among gamers. The brand extends well beyond headphones: they’re major sponsors of the Vans Warped Tour and are launching their own live streaming initiative, the #StayLoud sessions. With brand ambassadors like point guard Kyrie Irving and snowboarder Mark McMorris, Skullcandy is at the intersection of fashion, music and pop culture. And shoppers are also jumping on board: last year Skullcandy sales grew by 20%.
"To meet increasing international demand we hastily set up a Canadian site without a decision manager in place. We were immediately hit with a staggering amount of chargebacks. We needed a scalable fraud solution to help facilitate global expansion."
As their eCommerce site became an audio gear destination, Skullcandy started running into fraud. When they launched sites in Canada and Europe in 2015, they encountered a chargeback rate in excess of 1%. Skullcandy was in no position to deal with this threat: their US orders were vetted by a credit card gateway, but international orders were streaming in freely. The last defense was a manual review team that was totally overwhelmed.
Skullcandy brought in contractors to review orders, but they were inexperienced and expensive. Overhead soared, yet approval rates dipped. There was a heavy reliance on friction to verify customer identities, yet the customer care team was dealing with declined, angry shoppers. Skullcandy needed a scalable fraud solution to accommodate their rapid international growth without sacrificing the shopping experience.
“Review times were long and customer friction was hurting our brand. Riskified’s process is totally invisible: they’ve eliminated customer friction and significantly reduced our overhead costs”
Choosing a Solution
Skullcandy considered several solutions, and decided an all-inclusive one would be the best fit since it would be both scalable and eliminate the need to maintain a costly review team. Skullcandy attended the Merchant Risk Council conference in Las Vegas. They were impressed by Riskified’s technology and by the guarantee to raise approval rates and reimburse all fraudulent chargebacks. A quick integration later, and Riskified was reviewing all of Skullcandy and Astro’s order volume.
Higher approval rates
- Riskified approves 98% of Skullcandy
and Astro orders.
Rapid international growth
- 99% approval rates for Canadian site orders, 97% from European sites.
Improved operational efficiency
- Skullcandy no longer needs temporary employees to vet orders for fraud.
Fraud-related losses eliminated
- Skullcandy’s chargeback rate is near zero, eliminating hassle and chargeback penalties.
"Riskified was the scalable solution we needed.
Their 100% chargeback guarantee means we can concentrate on selling globally without worrying about fraud"
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