It’s an exciting time to be in eCommerce. In the US alone, online retail sales will reach an estimated $334 billion this year, accounting for 10% of all US retail sales. By 2018, the market is projected to be worth nearly half a trillion dollars. Online events ticket sales are experiencing similar expansion, with revenues in the US expected to grow by an average rate of 3.1% every year to 2019.

While more consumers choose to purchase event tickets online, consumer preferences are also shifting towards digital tickets. Unfortunately, it’s not only legitimate customers who prefer e-tickets to paper tickets. Digital tickets are attractive to fraudsters as well, because they are received immediately upon purchase and do not require providing a shipping address that could expose their location. Riskified’s data from online ticketing merchants shows that fraud rates are nearly twice as high in digital tickets compared to physical tickets.

Many traditional fraud prevention methods, such as AVS and billing-shipping distance checks, require a physical address. Since consumers are not required to provide a physical address in digital goods orders, such as e-tickets, merchants must find ways to verify the orders using the data that is available in these orders – namely email and IP addresses. The unfortunate reality is that industry growth is occurring in an area where many merchants find it difficult to accurately distinguish between legitimate and fraudulent transactions.

Riskified has the privilege to work with great ticketing merchants, including viagogo and Ticket Evolution. Generally speaking, merchants in the ticketing industry are all too aware of the need to protect themselves from fraud and have a good understanding of fraudulent purchasing patterns and behavior. In an effort to bring things into sharper focus, the following report includes fraud-related patterns we have identified through our work in the US ticketing industry.