Security and fraud
Taking your business digital has huge advantages, but makes you more vulnerable to fraud, especially when it comes to online sales. It’s easier to commit fraud online than in-store, and scammers have found many ways to take advantage of online businesses. However, there are steps you can take to prevent fraud and data theft and thereby protect your business and customers.
Types of Fraud
Credit Card Fraud
Stolen credit cards can be found on the dark web and used for online purchases. These transactions may look legitimate and not be flagged by the credit card company, so the transaction is processed. Ultimately you may have to refund the customer whose credit card was stolen, even after you’ve completed the purchase and even fulfilled the order.
In affiliate marketing, businesses pay a referral commission to affiliates who recommend the product through a unique, trackable link. Affiliate scammers can create fake activity to increase the commissions.
By presenting themselves as regular customers, these scammers make purchases online only to dispute the transactions with their banks at a later date. The bank then demands that the business refund the purchase even though the order of goods or services has been completed.
Account Fraud/Phishing Schemes
Many businesses allow customers to create accounts which store purchase history, contact information, and payment data. In phishing schemes, scammers will send fake emails to customers in order to solicit account information and then make fraudulent purchases using their accounts. The emails appear exactly as an official message would from the business, making it impossible for customers to distinguish them.
Social-media accounts are often used as login credentials which can be easier for criminals to hack, leading to multiple defrauded businesses.
Making small, frequent purchases using stolen credit cards, card testing schemes allow fraudsters to find out which credit cards are valid without raising red flags. Once they know which credit card is active, they move onto bigger purchases.
Prepaid Card Fraud
Virtual prepaid and gift cards are increasingly popular, and they can be great for business. However, prepaid card fraud can occur in a few different ways. Scammers can hack into online retail stores to obtain prepaid card numbers and activation codes, resell prepaid cards purchased with stolen credit cards, and even scan bar codes off of physical cards in-store to then later redeem online.
How to Identify Fraud
- Unusual orders: you know what a typical order looks like for your business, so anything out of the ordinary deserves a second look.
- Inconsistent address: Vastly different billing and shipping addresses, or multiple shipping addresses using the same billing address may indicate fraud.
- Multiple declined transactions.
- Multiple orders using different credit cards with the same contact information.
Ways to Prevent Fraud
- Conduct regular security checks on your website using checklists designed for businesses of your size.
- Use an Address Verification Service through your credit card processor or bank to flag strange billing addresses.
- Use Card Verification Value (CVV) numbers on credit cards to ensure customers are accessing the physical card to make the purchase.
- Try an anti-fraud solution. As your business grows, this may become a worthwhile investment to protect your business against fraud.
- If a transaction seems suspicious, research the customer online to see if any other businesses have reported fraudulent activity.
Digital employee experience
You can’t take your business digital alone. Your employees and customers need to be excited and engaged as well. Make sure that your employees are prepared by keeping them involved in the process from start to finish. Some employees may be especially interested in making digital updates; they can be put in charge of digital initiatives. Others might be more reluctant: it will be important to touch base with these employees throughout the process to ensure their continued buy in.
Regardless of their comfort level, going digital is an opportunity for all employees to learn new skills and demonstrate leadership. It’s possible to go digital without any coding skills, but if you have an employee interested in developing those skills, consider helping them enroll in a course or program. Going digital also creates a lot of data about your business. If you have an employee interested in data analytics, ask them to be responsible for generating, analyzing and developing takeaways from your digital data.
If another employee is a good writer or has a good eye, you might put them in charge of developing your website and your social-media presence. Creating these important representations of your company will require that they think about the customer’s experience and come up with creative ways to express how your company can help customers. Not only will this give them the opportunity to develop new skills, but they will also be able to interact with customers directly through social media and the “Contact us” features of your website. If none of your employees have digital skills or the ability to learn then, you may have to hire new, more digitally experienced employees. Learn more about selling online and digital customer experience.
Helping your employees
Just as you put effort into the digital customer experience, you should try to make digital interactions as easy for your employees as possible. [link to Digital customer experience] There are many digital tools for employees. Human resources software solutions make it easy for employees to access their benefits, request time off and manage how they will be paid. Digitise the way you pay employees to make payroll easier.
Think about the way your employees will communicate with their supervisors and with each other. There are many digital communication tools to consider, including email, text messages, and instant messaging services. Some may include video conferencing or calling functions. Choose the one that will work best for your organisation.
There may be other aspects of the employee experience that you can digitise, like time tracking, intranets, and file sharing. Always talk to your employees about where they’re having issues and how you can help them; this will help you prioritise digital tools.