Hydrobuilder Cuts Chargeback Rates 89% Via Fraud Management Solution

03-Nov-2017

As a startup company with less than 15 employees, Hydrobuilder, an e-Commerce retailer of indoor and outdoor gardening products, must handle the growing pains of dealing with increasing fraud attempts. To streamline the fraud prevention process and minimize overhead, Hydrobuilder onboarded the Kount platform and managed to:

  • Reduce its chargeback rate from 0.47% to 0.05% (an 89% decrease);
  • Decrease chargeback dollar amounts by 79%;
  • Reduce fraud losses by 70%;
  • Drop its decline rate from 10% to 4.49% (a 55% decrease); and
  • Reduce the number of manual reviews.

Hydrobuilder often dealt with “friendly fraud” issues prior to the implementation, according to Brittaney Cox, Director of Internal Resources at Hydrobuilder. Consumers would place orders but later on would claim that they hadn’t.

To repel this and other fraud attempts, Hydrobuilder uses Kount’s Order Linking technology to compare data elements in current transactions — such as Device IDs, email addresses, credit card account numbers, etc. — with data elements from past transactions to uncover fraud.

“We had a lot of customers coming in that would commit fraud and then change the information that they were using and commit fraud again,” Cox said in an interview with Retail TouchPoints. “We just had no visibility into catching that. In being able to link orders together through data, we were able to limit those cases where they just kept coming back and hitting us again.”

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Beyond the insights from Kount, the Hydrobuilder team gained the benefit of time savings. With such a small team, the company could ill afford to spend its time manually reviewing purchases to approve an order. But Kount’s platform is designed to be a hub that integrates platforms such as Whitepages Pro, which enable the company to automate confirmation for billing and shipping addresses.

“We write rules within the program so that we’re not manually reviewing every single transaction,” Cox said. “We’ve been able to implement rules based on patterns that we’ve seen. We’re not declining as many orders. It’s less time and less clicks going through to research all of the information, since it’s all in one spot.”