Merchant’s Guide to the Holidays

The holiday season doesn’t need to be stressful. It should be the most exciting time of the year, with higher sales volume, new customers, and large orders from long-time customers. All of this points to success and a great way to close out the year.
However, for merchants there is danger lurking in the holiday sales heyday. This danger is in the shape of heightened fraud risk, culminating in post-holiday chargebacks. The increase in chargebacks, once the holiday shopping spree dust has settled, comes in two primary forms: friendly fraud, and valid chargebacks from innocent victims of criminal activity.
For merchants, the goal over the holiday period is to maximize the good sales and minimize the fraud – this adds up to minimal chargebacks and more happy customers. A win-win all around, just what everyone wants at the start of a new year.
The key to this lies in how merchants approach the holiday sales season. Being prepared, flexible, available, communicative, and in tune with customers is vital for holiday success.
All Hands on Deck
The increased influx of holiday sales and website traffic can go one of two ways for merchants: success or disaster. The end result lies with the people charged with managing orders, providing manual review, authorizing purchases, and maintaining high customer satisfaction.
The team involved with orders, processing, fulfillment, and approvals must have a clear understanding of fraud detection and prevention. Remind them of the value of proactive customer service, where it concerns detecting fraud and ensuring that valued customers are not mistakenly declined.
Ensure the e-commerce website and m-commerce apps present a seamless and cohesive sales experience for browsers and buyers. Update these sales platforms with clearly visible holiday refund/return policies, provide an easy way for customers to contact a team member with questions, and test the payment and authorization solution to make sure it can handle the increased voume.
These small steps go a long way in preventing smart criminals from slipping through the fraud detection cracks during the busiest sales period of the year. Remember, fraudsters and criminals prey on merchant weakness – don’t let being busy turn to a weakness that exposes holes in e-commerce security.
Flexibility Is Key to Fraud and Chargeback Prevention
During the holiday season, merchants see orders from new customers, orders from new devices, large orders, delivery and cardholder address mismatches, and orders from known customers that don’t mesh with previous order history.
This is the new normal of the holiday season. With the boom in e-commerce and m-commerce, merchants have to be prepared for the unexpected. The benefit for CNP merchants lies in being able to take advantage of a global customer base. To do this effectively, it’s critical that merchants have a payment solution that can adjust, adapt, and respond to the changes in orders, volume, customers, and locales.
Too many merchants are using rigid payment solutions that do not allow for the changes that come with the holiday season. Smart merchants use a solution that grows with the changes in the business and customer base. However, it’s important that this same solution is using the best in fraud detection and prevention technology.
Remember, flexibility does not mean a complete relaxation of best business practices for fraud detection and prevention. Flexibility means that the solution works with you, not against you.
Know the Signs of Fraud to Prevent Chargebacks
Along with relying on a trusted fraud detection solution, merchants must know the common indicators and signs of fraud. Being able to spot fraud attempts allows merchants to take immediate action and prevent chargebacks from occurring.
Manual review can be time consuming, but when done right it can highlight signs that fraud is happening or being attempted.

  • Repeated small orders. This can be an indicator of card testing
  • Multiple purchases with different credit cards. When these happen from the same IP address, this can indicate card testing
  • Bulk purchases of eGift cards. Signs that a fraudster is buying eGift cards with stolen credit card details
  • Address mismatch. Address Verification Service (AVS) mismatches can indicate a stolen credit card or may highlight a customer error
  • Failure to respond to confirmation emails. Can be a sign of preparation for a friendly fraud chargeback
  • Repeated CVV errors. This can indicate that the cardholder is not making the purchase, which can be a stolen credit card or an unauthorized purchase

Make sure the entire payments and authorization team is aware of these common signs of fraud. If fraud is detected, have a response strategy in place to stop the fraud and protect your e-commerce and m-commerce sales tools from future attacks.
Putting an End to Post-Holiday Chargebacks
The post-holiday season should be one of success and relief. Knowing that you survived the busiest and most hectic sales period of the year with minimal disruptions, customer complaints, or employee issues is a true win at year-end.
Don’t let the lingering threat of post-holiday chargebacks put a damper on this celebration. Take advantage of a payment solution such as Verifi’s Global Payment Gateway to provide you the flexibility, fraud detection capability, and support you need.