Identifying fraud with an order management system
The shopping cycle never ends. Whereas brick-and-mortar stores have finite hours, people shopping on the Web can technically make purchases whenever and wherever they want. While this can benefit merchants in that a digital presence ensures the sun never sets on their retail empire, it also leads to problems in regard to fraud management.
With orders pouring in constantly, retailers are pressured to get products out the door as quickly as possible without any errors or delays. At the same time, this need for speed may lead to fraudulent purchases going overlooked. Perhaps a retailer does not authorize purchases as it should, or maybe it fails to identify scam in the making as it rushes to fulfill orders. Regardless of how fraud happens, it has become clear in recent years that it can be devastating for merchants.
Fraud can scare customers away… permanently
One recent report from CreditCards.com illustrated how fraud and data breaches can negatively affect retailers. Nearly half of respondents said they would avoid shopping with retailers during the holiday season if they suffered a breach that jeopardized consumers’ debit and credit card information. Some would even consider switching the way they make retail purchases and use more cash, which could result in a significant loss in sales for online stores.
Of course, there is some flexibility with this – if a customer can only purchase an item through a specific retailer, he or she will still likely buy the product. However, this is not always the case, which is why merchants must take specific actions to minimize fraud and data breaches.
“It depends on the type of retailer,” Jeff Foresman, an information security compliance lead at Rook Security, told the news source. “A retailer such as Target, where consumers have other options for shopping, might lead people to shop elsewhere. But if a building contractor has a business account at Home Depot, he won’t necessarily go elsewhere after a breach.”
While retailers have numerous options for minimizing fraud and data theft opportunities, one of the best solutions may be integrating a comprehensive order management system that scores orders as they are received. As an order management system processes orders, it can simultaneously execute comprehensive fraud checks based on the properties of the order. If each property is assigned a score (For example: An order value greater than $500 may receive a high score), the system will know to flag an order once it reaches a defined score or higher. Automating this process and setting aside orders that need a manual verification and continuing order processing for those that don’t can save retailers time and money.