What is payment fraud and how to prevent it
Retail in the UK is evolving, driven by a competitive market and shoppers demanding the latest tech to enhance their experience. Seamless shopper journeys are a must, and retailers need to embrace unified commerce to keep up.
But, who are your customers today? What do they really want? And how can you innovate to offer a great experience that encourages loyalty and increases revenue?
To answer these questions, we teamed up with 451 Research, interviewing 5950 consumers and over 2500 retailers in North America, Europe, Asia Pacific and Latin America.
But first, let’s take a look at some of the key terms:
|Contextual Commerce||Shopping opportunities integrated into everyday activities - allowing people to buy anytime, anywhere|
|Cross Channel (shopping)||Shopping across different retail channels. This could be someone browsing online and buying in-store|
|False Positives||Purchases made by a legitimate customer which are wrongly blocked due to suspicion of fraud|
||The setup companies need in order to support omnichannel journeys, to create a unified view of the shopper and stock.|
A poor in-store experience can have a lasting impact, with only a fifth of Brits returning to a store where they’ve previously had a bad experience. The main reasons for a bad experience? It’s obvious; out-of-stock items, long queues and not offering the right payment methods.
Out of stock items topped the survey as the most frustrating in-store experience, accounting for over £14bn in lost revenue in 2018. Four out of five said they wouldn’t return to a store if their desired item was out of stock the first time. This shows the impact it has on customer loyalty.
Queuing in-store is the second biggest source of lost revenue, costing retailers over £11bn each year. Two thirds abandoned a purchase and left the store because of long queues in the past six months. Our findings show that there is not only an immediate impact on sales due to long queues, but also a longer term impact - with only a quarter of Brits returning to make a purchase.
Payment methods are key, whether your shoppers are buying in-store, online or both. In-store, two thirds of Brits say contactless would improve store experience and over half of shoppers want to see digital wallets as a payment option. Fortunately, 91% of UK retailers say they are placing importance on offering the payment options that their customers want to pay with.
In ecommerce, retailers lost out on £8bn because the right payment methods were NOT available.
It’s not just about payment methods. Levelling up your checkout and limiting the amount of falsely identified fraud creates happy shoppers.
In 2018, checkout caused the most annoyance among online shoppers. Customers cited long, painful and manual forms as the key reason for abandoning their purchase at the payment stage. On the positive side, our study found that improving checkout experiences ranked as the highest priority for ecommerce businesses, with a third of retailers working on the optimization of their online checkout.
A quarter of Brits said they would shop online more often if they felt a retailer had a good fraud protection system in place, but only half of UK retailers feel prepared to tackle fraud - including managing and limiting the number of valid customer transactions that are erroneously declined.
The new frontier of retail is cross-channel and contextual commerce. Shoppers want the option to jump between channels as they move through the purchase journey, being able to shop on a given channel, at any given time. Not only that, but they want engagement with brands to be more personalized to them - this includes recommendations and offers.
Nearly a quarter of Brits made additional purchases in the last 6 months because a retailer offered them a cross-channel buying option. Retailers are starting to recognize this opportunity, with our research revealing that half find it very important to offer customers a consistent option of payment methods across sales channels.
People are more connected and busier than ever, and as a result, shoppers want the purchase experience to be integrated into their lives more seamlessly. This could mean buying through an app, such as Instagram or even buying via smart speaker. 45% of Brits told us they use social media frequently to shop, however only 17% of UK retailers offer the option for customers to purchase on their social media channels.
In 2018 there was a £15bn shaped hole left in the economy by businesses not offering cross-selling opportunities, nor recommended products or personalized offers. With shoppers increasingly expecting a more personalized experience when they shop, it’s not a surprise to see that 22% of UK shoppers would increase their spending at a store if they received a more personalized experience through product recommendations and preferences.
Implementing a unified commerce strategy is the solution, and by delivering a seamless and consistent shopping experience, you can tap into otherwise lost revenue.
To learn more about the experiences shoppers expect today, download the full report by hitting the button below.
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