Balancing Omnichannel opportunity and risk requires merchants to consider both the advantages and disadvantages.
Despite concerns about web-influenced customers going to stores to see goods before buying them online from the retailer with the cheapest price, studies show that retailers with cohesive cross-channel strategies in place boost sales. Forrester reports that cross-channel transactions are set to reach $1.4 trillion this year and to hit $1.8 trillion by 2018, due largely to the consumers using smartphones for product research before they buy in-store. Omnichannel has other benefits, too, like helping with market data collection and allowing for social media sharing.
While merchants are competing to quickly stop omnichannel fraud, the majority of merchants are still nervous about the blurring of card-present and card-not-present transactions. According to a Worldpay study, Fragmentation of Fraud, 77% of merchants believe their multichannel approach to retail makes fraud prevention harder and 76% actually say it makes them more open to fraud attacks. The majority believe that increasing number of markets, sales channels and payment methods make it harder to prevent fraud.
There are possible vulnerabilities in cross-channel, or omnichannel, commerce. If not careful, merchants could compound their risk by having both online and brick-and-mortar stores. For example, if customers can buy things online, initiate chargebacks, and then return those things to brick-and-mortar stores for a refund, chargeback fraud might double in cost. Then there are increased mobile channel risks. Yet, if merchants react to these fear with excessive front-end security measures they might scare away honest customers.
Honest consumers think less of others’ fraud and more of their customer experience when shopping online or in-store. As the digital and physical worlds continue to collide and converge, there are steps merchants can take to mitigate omnichannel risks without hurting conversions. The key is implementing intelligent tools and solutions that span across channels that are user friendly and can be tested and toggled to remain agile as well as adaptive to emerging threats.