Ecommerce Revenue Protection Pioneer Riskified Releases Results From Its First Annual Online Shopping & Fraud Behavior Consumer Survey

Ecommerce Revenue Protection Pioneer Riskified Releases Results From Its First Annual Online Shopping & Fraud Behavior Consumer Survey

PR Newswire

NEW YORK, Jan. 30, 2019

49 Percent of Shoppers Abandon the Retailer After Experiencing Credit Card Fraud  

48 Percent of Households with an Annual Income of $1 Million or More Admit to Reporting Legitimate Purchases as Fraudulent

NEW YORK, Jan. 30, 2019 /PRNewswire/ -- Riskified, the leading solution for eCommerce fraud prevention and revenue capture, today released its first annual Shopping and Fraud Behavior Report, which details the findings from a new consumer survey about online buying habits and reactions to credit card fraud. Riskified surveyed 5,000 US-based consumers aged 18 and older about their online shopping behaviors, experience with and prevalence of credit card fraud, repeat shopping likelihood and customer satisfaction to develop a full picture of how consumers react to a number of common shopping experiences. The results are worrisome for both consumers and merchants, as roughly half of respondents reported experience with credit card fraud and 30% had their purchase wrongly declined, with a corresponding negative impact on their satisfaction and return shopping.

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For US consumers, eCommerce credit card fraud is nearly an inevitability. Overall, 49% of consumers surveyed reported having been a victim of credit card fraud, where their card information was illegally used by someone else. But that percentage grew with age, suggesting that becoming a victim is only a matter of time. Among all respondent groups aged 31 or older, a majority of consumers were the victims of credit card fraud. Unfortunately for merchants, the obvious costs of fraud aren't the only costs. 49% of customers reported that they do not return to an online retailer after a fraud incident has taken place, meaning that the merchant will pay the cost of the fraud and lose future customers.

But that's only part of the cost of fraud. Merchants often decline orders out of caution, and previous research conducted by Riskified found that fear of fraud costs even more than the fraud itself, as merchants unnecessarily reject good customers. This survey bears that out, as 30% of respondents reported having an order declined, and 57% of those declines happen to returning customers, squandering the good will merchants had built. The survey further found that roughly 42% of shoppers who experienced a decline moved on, either abandoning the purchase completely (28%) or shopping with a competitor instead (14%).

Even shoppers who aren't declined may move away from a purchase. 84% of respondents reported abandoning an order before completing the purchase, with many of these shoppers blaming the checkout process. 37.3% abandoned a purchase because of a complicated checkout, while 34.9% blamed a bad mobile experience.

"It's really difficult for any single retailer to effectively manage their fraud, and this survey shows just how damaging it is when they fail to do so," said Eyal Raab, vice president of business development. "Merchants need to be able to meet their customers where and how they want to shop, but offering options like omnichannel fulfillment or digital gift cards opens them up to threats. Making accurate decisions and approving good orders not only increases revenue now, it also makes happier, more loyal customers in the future."

Additional key findings from the survey include:

Impact of household income on fraud and reimbursement:

Customers blame merchants for fraud:

Friction leads to cart abandonment: 

Shoppers watch their wallets:

In addition to this data, the report includes more information on consumer shopping habits and preferences and outlines best practices for merchants to combat fraud. It can be found here: https://blog.riskified.com/inside-riskifieds-shopping-and-fraud-behavior-report.

To learn more about Riskified, please visit www.riskified.com.

About Riskified
Riskified turns "shoppers" into "customers" by improving conversion at all stages of the path to purchase. The world's largest brands - from airlines to luxury fashion houses to gift card marketplaces - trust us to increase revenue, manage risk and enhance their customer experience. Merchants lose billions of dollars to legacy fraud solutions, payment failures, high-friction verification methods and more. Riskified uses powerful machine-learning algorithms to recognize legitimate customers and help them complete their purchase. And then we guarantee that income. Merchants can safely approve more orders, expand internationally and fulfill omnichannel flows while providing a frictionless customer experience.

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