Seeking Out Risk Management Expertise for Competitive Advantage
Adaptive fraud detection solution can help businesses manage growing risk of fraud while increasing customer conversion and loyalty.
Businesses are surrounded by risk. A fraud epidemic sweeping across the globe shows no signs of abating, bringing with it the threat of financial loss, reputational damage, customer attrition and much more. Yet for most businesses, the focus is innovation, success and growth, not risk and payments. That’s why it’s essential to find a trusted partner with the tools and experience to differentiate legitimate customers from scammers. With the right third-party expertise at your fingertips, risk management can become a true competitive advantage.
Digital transformation is changing the face of retail. Over half ($0.56) of every dollar spent in-store is influenced by a digital interaction, and the figure is growing all the time, according to Deloitte. Cloud, mobile, IoT and social platforms are opening up huge new growth opportunities for retailers as they look to streamline processes, unify sales and marketing channels and improve the customer experience. It’s no surprise that only 5% of e-commerce players aren’t planning to implement digital transformation, while over half (56%) already have omnichannel capabilities in place.
Yet this rush to digitize is also leaving retailers more exposed than they’ve ever been to the threat of fraud. As customers jump around from screen to screen and channel to channel they become harder to verify. On the other side, fraudsters are increasingly well resourced thanks to the anonymizing tools, customer identity data and credential testing software they can find on the cybercrime underground. They know there are gaps to exploit online when merchants have failed to manage risk adequately. That’s why CNP fraud is now 81% more prevalent than point of sale (POS) fraud, according to Javelin Strategy & Research. In fact, it’s helped to bump up total retail fraud, which is estimated by the National Retail Federation to have hit $15bn in 2017. In Europe, card losses reportedly rose 2% last year to hit €30m ($35m).
Gaining an Advantage
In those terms, it makes sense to get a better handle on fraud risk. Yet most merchants are not in the business of payments; nor are they in the business of risk. They need outside help: but while the market is crammed with companies offering to help with fraud prevention, it’s important to make the right choice. Merchants don’t need a vendor, they need an expert partner with the skills, experience to work with them on managing risk.
What should they be looking for? Best-in-class, adaptive platform continuously evolving to learn how to spot new fraud patterns as they emerge — effectively future-proofing their investment. They may also benefit from the international reach of a partner able to crunch data from a wide range of sources and track fraud patterns as they spread across the globe. But most importantly they need an expert that can take a more nuanced, risk management approach to fraud prevention. It’s not just about stopping all transactions with a poor risk score, for example. On some occasions, the customer experience may be more important. That’s what gives adaptive decisioning the edge.
The retail space today is pretty unforgiving. But in a world of shrinking margins and strong competition, good risk management becomes more than a nice-to-have: it’s a differentiator that could give your business a serious advantage over the competition.
To learn more about Simility’s future-ready fraud prevention platform, schedule a demo today.
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