How to prepare your ecommerce business for Black Friday & Cyber Weekend

Peak season for cybercriminals and fraudsters is just around the corner. Over the last few years, Black Friday (the last Friday in November) and Cyber Monday (the following Monday) have set online traffic and revenue records, crowning the two days as the biggest ecommerce events of the year.

And so far, no other days have managed to dethrone them in the UK and US. In fact, big discounts and price-cuts have consistently driven consumers have to shop even more than previous years.

More sales, more promo codes and more traffic all mean more revenue. But all this also means more fraud, more complaints, more chargebacks. So, how should retailers be prepared?

What Black Friday and Cyber Monday mean for fraud

Manual payment processes and manual reviews of customers marked as potentially fraudulent are incredibly difficult to scale when the high volumes hit.

On Cyber Weekend, everyone will be all hands on to ensure smooth running of systems. But will they be working efficiently?

Companies can always ask their staff to work longer hours, which is expensive to do. Alternatively, retailers may choose to outsource some of their human manual review to third parties to help out them during the busy period. It's not unheard of to see retailers, overwhelmed or overly optimistic (naive?) about fraud on high-transaction-volume days asking their staff to work around the clock and even to relax some of their fraud defenses.

Fraudsters are aware of this too, and eager to take advantage.

If you have analytics from last year, take a deep dive to better understand the type of fraud that might have affected you, as well as the particular techniques.

Ask questions such as:

• How many transactions went through over the weekend?
• What was the chargeback rate?
• Is the chargeback proportionate to the overall number of transactions?
• Are general fraud proportions more, the same, or less?
• Were there any patterns in the fraudulent attacks? For example, were all IPs from specific countries or regions?
• Are systems as automated as they possibly can be?

How to prevent Cyber Weekend fraud

Once you have assessed your fraud landscape, here are some actionable steps to consider:

Check the chargeback and fraud proportions: Let's say that you typically get one chargeback in every 100 orders, but over the weekend this changed to 5 per 100 orders. If proportions are worse, this is a red flag. If it’s relatively similar to usual numbers with no obvious spike, then it’s an amber flag. If you’re getting fewer chargebacks over the busy weekend, well, may we suggest recalculating, as there may be a problem in the numbers...?

Automate, and automate again: Importantly, retailers should automate as much as they can. The better your systems, the fewer you need to rely on human intervention. Ideally, you want to leverage machine learning, so the system adapts to the fraud that is actively targeting you. Investing in a good fraud detection product takes the stress away from the team, minimizing the need for manual reviews, and letting the product take the burden for what would usually be a human process.

Keep abreast of new trends: Keep up to date with the fraud landscape to know where to put more resources and what to look out for. For instance, in 2022 through to 2023, experts have highlighted a rise in multi-layered attacks, machine-learning and AI attacks, and synthetic identities.

Don't forget friendly fraud: Don't forget that cardholders can sometimes demonstrate fraudulent behavior too. Read Ravelin's 2023 Consumer Fraud Survey and ensure you are well-prepared for those opportunistic, insincere chargeback requests. At the very least, have clear and thorough Terms and Conditions and keep good track of sales, shipping and other operations, together with well-documented evidence, so you can dispute a chargeback if required.

Automated fraud prevention will result in higher acceptance rates and keep your chargebacks low by using a system that scales without human interaction. And what happens when fraudsters also deploy ML to attack you?

One unexpected piece of advice suggests that you should ensure that you should of course block these transactions – but do so in a way that doesn't transparently show the customer that you think they are fraudulent. By trapping rather than obviously blocking ML-using fraudsters, you make it less likely that their ML module will learn from the incident and adapt to eventually fool your systems.

High stress and low patience

While these high-volume trading days are great for consumers to bag a deal, they're also the perfect opportunity for fraudsters to snag one too. Due to the sheer volume of transactions that take place, fraudulent transactions are more likely to sneak through the cracks, making it harder for merchants to spot fake accounts, fraudsters and stolen payment credentials.

With stress high and patience low over Cyber Weekend, it doesn’t help that many retailers will be shifting their focus on optimizing as many transactions as possible and getting as many customer through to their website as possible.

As a consumer, facing friction on a website is a no-go, especially if faced with additional hurdles such as verification when trying to make a purchase. Many consumers will just go elsewhere.

However, while retailers want consumers to shop seamlessly, they also need to be more vigilant to make sure that they have payment protection mechanisms in place so that fraudsters aren’t taking a cut out of their profits over the busy weekend.

To learn more about battling online payment fraud efficiently, visit our insights page.