Peak shopping season is just around the corner. (Yes, really.) There's plenty to do over the next few months, so we've put together four tips to focus on now in preparation.
During the upcoming peak shopping season, your business almost certainly anticipates handling a higher-than-usual volume of sales. Peak season transactions can account for 30 percent or more of the year’s total volume for retailers.
You may be working on selling strategies and special promotions. But these could open your business up to increased fraud risk. They could also lead you to consider your fraud strategy and your fraud management tools.
We've put together a series of tips to help you protect your business against fraud and risk, while delivering a great experience for genuine customers. Below are four recommendations to prepare for peak season now.
Tip 1. Understand the holiday chargeback cycle
Chargebacks are charges returned to payment cards after customers dispute items on their account statements from orders placed during peak season. They can be reported up to 120 days after the purchase. Make sure that you understand the holiday chargeback cycle so that the financial impact of chargebacks doesn't catch you off-guard. To do this, create a chargeback forecast based on:
- Chargebacks reported in 2020
- 2020 peak transaction volume
- 2021 peak volume expectations
If the forecast amount looks like a cause for concern, you may need to plan for fraud strategy updates, while acknowledging the potential increase in customer friction and false positives.
Tip 2. Identify promotion and sale periods
You will likely put a lot of effort into planning the peak season sales rollout, including:
- Which products will be on sale
- How they'll be marketed to your customers
- When those marketing promotions or campaigns will launch
You may already be planning changes to your fraud tool to take account of how customer spending patterns are different during peak season than at other times.
You may consider making fraud strategy changes that tie in with those campaigns. Think about, for example, loyal customers who receive an email promoting a particular product that's available at a special price on a certain day. When one of those customers goes to buy three of them on the same day, your fraud prevention tool needs to be able to recognize this behavior as normal and prevent standard screening checks from flagging the order as suspicious.
Tip 3. Manage product restrictions driven by COVID-19
We've seen the toll that COVID-19 has taken on manufacturing and distribution streams over the past year or more. As peak season approaches, those effects continue to be felt. You'll need to work out whether to apply quantity restrictions on any of your products and, if so, what those restrictions should look like.
Although eCommerce websites can generally restrict the number of identical products that can be bought at the same time, customers wanting to buy larger quantities may simply bypass these restrictions by making multiple purchases.
To prevent that, you should be able to implement limitations (or policy rules) within your fraud tool to limit purchases of a specific product to, say, two per day per email address. You'll want to be sure you build and test this kind of functionality well ahead of peak season, and that you're ready to make last-minute adjustments to reflect the supply chain situation.
Tip 4. Start planning your peak season staffing
Peak shopping season generally brings staffing challenges, but COVID-19 has made it more difficult than ever to find the right people, even on a temporary basis. Get a head start on the hiring process by preparing for new hires.
Of course, hiring is only half the battle: You also need to train them. (This takes time—so another reason to plan well ahead.) Set expectations with your team so that they know what resources they need to provide, and when.
Look for more peak season tips soon.