More than half of the maternity apparel retailer’s online traffic comes from mobile shoppers.
Since installing a consumer I.D. authentication tool two months ago, MyIrock.com, a retailer of digital media players and related equipment, has wiped out online fraud that had touched up to 50% of its orders, says Internet manager Sonia Soto.
Since installing a consumer I.D. authentication tool two months ago, MyIrock.com, a retailer of digital media players and related equipment, has wiped out online fraud that had touched up to 50% of its orders, Internet manager Sonia Soto tells Internet Retailer.
“We were getting a huge amount of fraud, 20-50% of orders,” Soto says. “We were losing products, which could be $15 to $120 each, and then getting credit card chargebacks.”
But since deploying the Decision Manager I.D. authentication system from CyberSource Corp., “we’ve eliminated fraud 100%,” Soto says.
The fraudulent orders came in many forms, including automated software-driven attacks and the use of relay telephone operators to disguise the buyer’s telephone number, Soto says. The relay telephone operators would, for example, pass on an order from a purchaser using a system designed for deaf people. That system allows a deaf person to place a phone order by typing a message into a special telephone device that the operator can translate through a separate device and forward to a retailer in a phone conversation with a retailer’s customer service rep. “The operator would say, ‘this is an order from a deaf person,’ and we could only see the operator’s phone number, not the buyer’s,” Soto says. But in most cases, those calls from supposedly deaf consumers turned out to be fraudulent, she adds.
Soto used to spend a lot of her time every week compiling records of fraudulent orders and their associated credit card accounts, which she maintained in a database. She would then match the database against incoming orders to check for suspected fraud. But the manual process not only absorbed much of her time, but also that of customer service reps who would help verify suspicious orders. Meantime, orders were being delayed and holding up warehouse operations. “So customers had to wait longer for their orders,” Soto says.
Since implementing the Decision Manager application, MyIrock.com has processed no fraudulent orders and eliminated chargebacks, Soto says. The few times the site has received calls from credit card companies about suspected chargebacks, each has turned out to be a case where the legitimate consumer had either forgotten she made the purchase or didn’t recognize the name of MyIrock.com’s parent company in their credit card statement, Soto says.
The Decision Manager, which is hosted by CyberSource, operates on rules set by the retailer on how to evaluate the security level of online orders. For example, Soto can set rules based on the value of orders, the frequency of orders from the same credit card account, and whether the ship-to and bill-to addresses are in different countries.
The software then rates each incoming order and places it into one of three buckets – “accept,” “reject” or “review.” Retailers must still conduct some manual review and checking, but the system is far faster and more accurate than IRock’s former database system, Soto says.
Soto, who also serves as IRock.com’s marketing manager, says that she so far has implemented only some of the Demand Management application’s features, and that she expects to save even more time as she fully rolls out the system. So instead of chasing crooks, she can devote more time to merchandising, marketing and planning for a revised site, she says.