16.9 percent. As you read through this article, keep that number in mind. 16.9 percent. That is the percentage growth of ecommerce sales that 2013 had over 2012. It might be hard to imagine that ecommerce could have that high of a growth rate when seemingly there are endless amounts of websites already selling on the web and online giants such as Amazon have the appearance of dominating online sales. But ecommerce according to the US Census Bureau is poised for unprecedented growth. According to a report that was released on February 18, ecommerce had $263.3 billion dollars in sales in 2013. That number though amounts to a measly 5.8% of total sales in America.
As we can see, the pace of ecommerce growth is growing at a faster rate year over year. Just in the news today was the announcement that yet another large brick and mortar company, Radio Shack, was closing 20% of its stores as it lost too many sales to online stores. For merchants who already have online stores and for entrepreneurs looking to jumpstart a new store online, this is the perfect time to start. As a new generation of shoppers looks to buy, consumers who were handed a tablet and a smartphone before they were given car keys will naturally look to purchase online before heading out to the mall.
Every year Cyber Source releases a fantastic report that is more or less a ‘state of the union’ on the current state of ecommerce. Cybersource, a property of Visa, highlights the security measures that merchants must take to protect themselves as they sell online. In its latest report, Cyber Source estimated $3.5 Billion was lost to fraudulent activity and chargebacks online. To put that number truly into perspective, consider this. In 2013 retail stores had final sales of $5.085 TRILLION dollars, and if they had equal losses it would come to $67,630,500,000.
Clearly, online retailers can do and must do more to ensure that as ecommerce begins its stratospheric growth that fraudsters and crooks who traditionally stole from retail stores don’t bump that percentage higher once they switch to online stores. The question then is how do merchants who are just starting a store online know how to protect themselves properly from the faceless masses on the internet?
Well luckily for online merchants, as ecommerce has grown so has new fraud prevention solutions. Companies such as Signifyd, who gather hundreds of data points on shoppers from sources such as social media, previous shopping history from other merchants and offline checks such IP location and device fingerprinting, can provide instant analysis as to who would be a trusted buyer online and who are bad shoppers likely to steal or initiate a chargeback.
Data breaches at companies such as Niemen Marcus and Target have given cyber crooks countless cards to steal with. As we can see from the Census Bureau statistically those cards will be used against retail stores, but as we enter this exciting time of ecommerce growth lets collectively make sure that we protect ourselves with the proper tools like Signifyd before those crooks use most of those cards against internet retailers.