A Special Report for Online Jewelers
“Card Not Present” transactions always pose a higher risk than traditional in-store sales. But, the truth is, online sales are quickly causing a disruption in the brick and mortar jewelry stores. This forces many jewelers into making the decision to sell products via your website in addition to in-store sales.
As a result of this shift, a growing portion of jewelry sales is now done through online sales. In fact, online sales of watch and jewelry products in America increased from less than a third in 2011, to more than half of in 2016.
For most jewelers, selling online is new and unfamiliar. Every business selling online is wary of chargebacks, but jewelers lose big-time when fraud occurs. It’s a sticky situation to implement fraud filters that may be so strong they block the sales to “good” customers.
As eCommerce becomes more prominent, jewelers need to consider how to adjust their operations and adapt to new buying trends and methods. To capture new markets and reach sales goals, jewelers must balance fraud prevention with the need to provide a smooth shopping experience. This includes reducing human interaction and limiting the use of annoying validation methods such as a telephone verification.
Despite the challenges of selling online, data shows that jewelers can safely approve over 95% of online transactions. Businesses approving significantly less than this amount are likely declining good customers. Being declined during the sales process can cause a negative experience for the customer and result in the loss of a customer forever both in online sales and in-store sales.
Providing first-time customers with a positive experience will encourage good online reviews, which are crucial these days but will also give shoppers a reason to return. Repeat customer spend three times more per purchase than one-time shoppers.
This is super important to note: Systems must be implemented to identify repeat shoppers and treat them as such. Many jewelers cross-reference online purchases only by customer name and email address, which can lead to an awkward situation where the system identifies a returning customer as a first-time shopper when they use a work email address rather than a personal email address as in a past purchase. Using additional identification methods such as cross-referencing orders using an IP address, device fingerprint, and email domain, retailers can identify returning customers as a returning customer.
Something as simple as using a promo code can significantly reduce fraud. You can consider the use of a promo code as a safe indicator. The rate of fraud in watches and jewelry bought using a promo code is 75% lower than average! Given that fraudsters generally use stolen credit cards, they aren’t really interested in getting a discount since they don’t have any intention to pay.
Diamonds are most likely to be fraudulently purchased. Statistics show that fraudsters tend to order products with a higher resale value. The rate of fraud with fine jewelry purchases is 1.5 times higher than fashion jewelry. Online purchases of gold jewelry carry approximately six times more risk than those of silver and titanium jewelry, and diamond jewelry orders are ten times more risky.
More bling, more fraud! The same rule applies within product categories. Engagement rings, set with a diamond, are five times more likely to be fraudulently purchased compared to wedding rings. They also carry twice the risk of fraud as other types of rings, including those set with gemstones or crystals.
As one might expect, data confirms that the higher the value of an online jewelry transaction, the riskier it is. ECommerce transactions worth less than $200 are very safe, and jewelers should be able to safely approve almost 100% of these transactions without fear. A purchase worth over $1,000, however, is 20 times more likely to be fraudulent than a purchase below $200. Despite the significantly higher risk of fraud, retailers can still safely approve 75% of these high-ticket purchases.
For assistance in accepting credit cards for eCommerce and protecting yourself from fraud, please contact us at www.chosenpayments.com or call us at 855-4CHOSEN.
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