Retail, CPG and Logistics

Key fraud trends retailers need to watch out in 2024

The retail landscape has shifted and changed so much over the past year with the advent of AI, the growth of the creator economy, and the ever-increasing importance of employee well-being. Criminals today, constantly find new ways to attack brands and their customers, rapidly switching tactics, channels, and targets. But retailers don’t have to get stuck playing catch-up. Planning early on for emerging fraud trends can largely benefit businesses and stay ahead of evolving fraudulent tactics, that will also aid in protecting revenue and customer relationships.

Let’s explore the 4 pressing trends in retail fraud that are on the rise and have greater potential to impact business and in turn affect customers in 2024.

Rise Of Account Takeovers and Synthetic Identities

  • 22.6% of all logins are ATO attempts
  • 2/3 merchants recognize ATO as a major threat
  • 40% of traffic to ecommerce websites are by bots

Major fraud types:

  • BOPSIS (Buy Online Pick up in Store Fraud)
  • Delivery and refund related frauds

Promo Abuse

  • 73% of retailers are subject to promotion abuse
  • 22% of retailers are experiencing loyalty fraud

AI-Generated Content

Key impacts of AI:

  • Gen AI’s ability to obfuscate user data, generate device fingerprints, and mask IPs
  • Fake identities used to claim refunds through damage claims with manipulated videos

POS (In-store) Fraud

  • 57% retailers noticed employee fraud
  • $2.2k average cost to retailers per internal theft

Major fraud types:

  • Under/over ringing and voids will continue to be abused
  • Loyalty abuse and collusion will increase

Our Success Stories

Knocking out the fraudsters with analytics for a US-based retail company

Benefits delivered:

  • $2.5 million annualized savings
  • False positive rate reduced to 0.08%
  • POS fraud recovered worth $400k
  • Chargeback rate reduced to 0.04%

Outwitting frauds and saving millions for a global athleisure giant

Benefits delivered:

  • Over $8 million in savings
  • Shrinkage rate reduced from 2% to under 1%
  • 3000+ fraud instances identified
  • 10x ROI year on year

Improving fraud detection for a global travel food retailer through standardized data analysis

Benefits delivered:

  • Higher fraud detection
  • Identified new category of highly complex fraud
  • Globalized/standardized loss management

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