Shouldn’t Fraud Prevention Be Easier Than Fixing a Transmission?
An automatic transmission is an incredibly complex piece of equipment containing mechanical systems, hydraulic systems, electrical systems, computer controls and hundreds of parts. As one automotive writer described them, “they’re pretty much black magic.”
Here are just a few of the systems and subsystems that must precisely and repeatedly interact:
- Planetary Gear Sets
- Oil Pump
- Valve Body
- Clutches and Bands
- Seals and Gaskets
- Torque Converter
- Modulator or Throttle Cable
Here’s an equation for all those math lovers out there (this one’s a planetary gear ratio equation):
If your eCommerce automotive, powersports, aftermarket products, or performance and accessories business is trying to fix a growing fraud problem, the complexity of an automatic transmission may seem like child’s play compared to the difficulty of figuring out which fraud prevention solution is right for you.
In-house, do-it-yourself. Many e-commerce operations start out with simple, in-house fraud prevention processes. But as fraudsters have become more sophisticated and the incidence of eCommerce fraud increases, the do-it-yourself approach can quickly get overwhelmed…and overwhelming. For example, just one of the subsystems involved in anti-fraud prevention is PCI Compliance, which has 13 steps or requirements. And PCI compliance is only one of the moving parts!
The additional investments in IT infrastructure, fraud prevention expertise, and technology and tools to build your own fraud prevention system can be a huge distraction from your core business
Third party, workbench solutions. These third-party offerings can range from standalone, ad hoc tools like Device ID to workbench packages that aggregate multiple technologies. Once again, to effectively fight card-not-present (CNP) fraud as it rapidly metastasizes in the eCommerce space, the complexity involved in using these types of systems grows. For example, one legacy workbench solution in the market can require you to develop, write and maintain over 100 rules!
On the other end of the spectrum are fraud prevention systems that promise less complexity. But beware: you may sacrifice revenue, efficiency, and optimal results in your quest for simplicity.
Artificial Intelligence. These solutions promise a “set-it-and-forget-it” approach. While it may sound enticing at first, there are a number of issues to consider. First and foremost, these companies use self-reporting by merchants to “identify” fraud. Unfortunately, merchants aren’t fraud experts, which means a lot of incorrect data gets into the system (e.g., “false positive” transactions that look suspicious but are in fact legitimate and get wrongly reported as fraud). Second, their algorithms can be “peanut-buttered” across multiple market segments and industries. In essence, fraud prevention for your unique business may be treated the same as if you were a fast food restaurant. Or your transactions may be evaluated like those of a large national chain instead of a one-of-a-kind, specialty site. On top of all that, we’ve noticed a lot of downtime with some providers in this space.
Guaranteed chargeback protection. A number of these service providers assume the responsibility for chargebacks, supposedly simplifying online fraud prevention. However, it’s important to note that their interests may not align with yours. Obviously, they don’t want to pay out big sums on chargebacks so their bias is to decline suspicious orders that may cost them money. You have no control if this bias reduces your revenue due to more declined orders.
Kount offers a compelling alternative that delivers the simplicity you want, with the control you need.
Easy, predictable, Software as a Service (SaaS). SaaS greatly simplifies fraud prevention and eliminates many costs. It delivers low-cost implementation, so you can devote your IT budget to improving customer experience rather than on expensive IT projects for fraud prevention. SaaS also avoids the costs for technology, IT infrastructure and headcount that are associated with in-house, “do-it-yourself” installations. What’s more, the SaaS approach is extremely scalable. You can easily handle future growth, as well as promotional or holiday surges. You only buy what you need, when you need it. And you never worry about investing too much or under spending and leaving your operations vulnerable. Finally, Kount combines enterprise-class capabilities that maximize sales, slash fraud, and minimize costs:
- Superior Fraud Screening and Analytics
- Real-time Data Orchestration
- Advanced AI Machine Learning Technology
- Expert Human Intelligence
- Chargeback Data Feed
Want to know more about fraud prevention for the online automotive, powersports, aftermarket products, and performance and accessories industries? Check out our latest eBook "Does Your Fraud Prevention Need a Tune Up?".