Retailers Struggle with Frictionless vs. Fraud

Almost everything an online merchant can do to make buying easier for customers also makes things easier for the professional fraudsters who prey on ecommerce companies.

Let’s just agree that life isn’t fair.

But removing friction from online shopping excursions and protecting a business from those who seek to take advantage is not impossible. In fact, as retail technology marches forward, it is arguably becoming easier to have both. I think of it as the frictionless vs. fraud conundrum, though more than fraud is in the mix when it comes to creating memorable customer experiences online.

How to balance customer experience and eliminating risk

The conundrum is a topic that I asked Dara Meath to take few minutes to talk to me about at IRCE, the major annual trade show for ecommerce retailers, vendors and experts who converge on Chicago every spring.

Meath is the vice president for information technology at the Camuto Group, an apparel retail conglomerate that counts Tory Burch, the Jessica Simpson Collection, Lucky Brand Jeans and Vince Camuto among the brands that it owns, licenses or has partnerships with.

Among other things, I asked Meath how online merchants should think about balancing the need to provide a frictionless customer experience with the need to protect themselves from fraud and other abuses that a seamless experience can potentially open them up to.

Meath shared some of her thoughts in the brief video interview below.

It’s clear that as consumer habits change and retailers react to — and try to anticipate — new shopping preferences, the risks and threats that retailers face evolve. Meath talked  about pop-up shops, which delight shoppers, but which leave retailers vulnerable because of the ephemeral nature of their stores.

Innovative technology supports better customer experiences

The temporary storefronts are the physical-world equivalent of online flash sales, which by definition mean an extremely high velocity of sales in a compressed amount of time. Systems that rely on manual order review or fraud protection based on pre-ordained rules simply can’t keep up with the spike in volume, meaning retailers need to turn to innovative technology solutions in order to protect themselves while still giving customers what they want.

No question merchants will continue to focus intently on consumers and the ways they want to shop. They will continue to find ways to make the shopping, buying, paying and fulfillment processes better for their customers. And, no question, life will continue to be unfair. But there is hope, as Meath pointed out, that innovators will also continue to come up with ways to make consumers’ lives easier, while making retailers’ businesses more secure against those looking to exploit any weakness.

Photo by Mike Cassidy

Contact Mike Cassidy at mike.cassidy@signifyd.com; follow him on Twitter @mikecassidy.

Mike Cassidy

Mike is lead storyteller at Signifyd. A former journalist and a retail geek, he covers ecommerce and the way technology is transforming digital commerce. Contact him at mike.cassidy@signifyd.com; follow him on Twitter at @mikecassidy.

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