Holiday Fraud

BRANDING: #PaymentsTips
Each month, we’ll help you navigate the emerging trends and forecasts for card-not-present (CNP) merchants with (what we think) are the best pieces of advice from Verifi, as well as from across the web. We promise to keep this newsletter short and sweet, so let’s get started!
Q> The holiday sales season is quickly approaching and on top of that the EMV liability shift has taken place along with increased holiday fraud chargebacks. What steps do I need to take to ensure that my payments are protected as I move into the peak selling season?  

November is here and we are headed straight into the busiest and most profitable selling season of the year; sales are estimated to hit $617 billion . Are you ready to reap the benefits?. Unfortunately not all of your customers are on Santa’s Good List, holiday fraudsters will also be on the rise during this time of the year impacting your bottom line with holiday chargebacks. A comprehensive, layered fraud prevention is key this year to protecting your hard earned holiday profits. But merchants will have to go beyond a solid defense if they want to benefit from the strong sales forecast.
This holiday season also brings forth a wealth of opportunities as a result of increased mobile spending. Harnessing the power of mobile and optimizing all of your channels is your best bet to increasing customer loyalty and holiday spending. This month’s newsletter offers both defensive and offensive tips and tricks to help you maximize sales and boost profit from now until the New Year.

Friendly fraud is rampant during the holiday sales rush. Merchants can expect a 50% typical increase in holiday chargebacks as some shoppers rush to purchase gifts for family and friends and later encounter buyer’s remorse. Last year, we offered information on how to avoid the chargeback Grinch and preserve holiday profits. This year, we recently published new tips on keeping true and friendly fraud at bay during the busiest selling season of the year.
Given the rash of recent data breaches, the risk of true fraud chargebacks is also elevated. Stolen data becomes available on the dark web and fraudsters can use the busy holiday to their advantage, racking up fraudulent purchases, which result in chargebacks later on.  There are quick fixes you can make to avert some of these chargebacks, but a total chargeback management solution can infinitely improve your bottom line.

Omni-channel optimization is key to taking advantage of booming holiday sales. Consumers are more plugged into mobile devices than ever, making data more readily available to merchants who can effectively collect and analyze it. Establishing a unified view of shopper interactions is one of the top challenges faced by merchants. Merchants need actionable business insights and customized reporting to maintain a global view of business priorities and optimize profitability.
Merchants will need to future-proof their business by effectively navigating the blurring card-present and card-not present channels. To do that, they need to improve and protect payments across the entire transaction lifecycle and across all channels.


Gifts cards have always been a core facet to retailers’ holiday promotions. Each year, retailers roll out fancy holiday renditions of those rectangular pieces of plastic as part of an attempt to maximize holiday sales. While this trend isn’t changing, it is evolving. This year, the average US consumer has spent 51% of their time on a mobile device (compared to 42% of time on desktops), illustrating the steam that mobile continues to gain. This is an important stat for merchants who want to remain successful with their gift card program.
It’s one of the reasons that Starbucks has been so successful. Their Mobile Order & Pay program and loyalty program (which uses digital gift cards) have showed positive results as part of a comprehensive digital strategy. Starbucks has effectively leveraged third-party loyalty relationships to create new revenue streams. Any merchant would benefit from taking a page from the Starbucks loyalty playbook….or you can take a look at ours.

Holiday retail sales are projected to hit $617 billion, so merchants should ensure that their ducks are in a row. They can do that by understanding what last years trends mean for this year’s sales:

November will be a true test of retailer-readiness as we approach the holidays. By implementing end-to-end fraud and chargeback management and prevention strategies and optimizing all channels to meet consumer expectations, merchants can expect to have a strong selling season. The evolving – and lengthening – holiday selling season will have impacts on both CP and CNP commerce, so merchants should be analyzing how this holiday season unfolds to better prepare for next year…as well as the months directly subsequent to the holidays. Sales predictions look strong, which bodes well for merchants’ bottom lines. Properly safeguarding payments will require comprehensive fraud management that effectively does its job without hindering legitimate sales.
Don’t forget…you can now download our updated ebook: What Every Card Not Present Merchant Should Know: Navigating Today’s Challenging Payment Ecosystem? Get it now!
What are your thoughts? Ping us on Twitter (@verifi) with #paymentstips and let us know what you think.