Technology developed during the pandemic could prove a game-changer in the fight against refund fraud.
Throughout 2020 retailers and suppliers have worked together, usually at a feverish pace, to develop solutions to challenges as they emerge. Covid safe signage, people counters, PPE and direct to store third party deliveries are all areas that saw massive developments in short spaces of time.
If I had to pick one thing (excluding Could) that distinguished 2020 in the annals of retail history it would not be the accelerated demise of cash. Although that would come a close second. For me the thing that 2020 will be remembered for is the move to online.
Of course the massive growth in online shopping has been met with increased fraudulent activity on the part of the criminal fraternity. And one major area of growing concern is online refund fraud…
The problem is that when a customer calls up insisting that they have not received SOME of the goods, it is difficult to argue with them. Sure you can have a picture of a box being delivered to the front door. But that is not proof that the order was complete, just that a box was delivered.
For most retailers in this situation the only solution is an apology and replacement of the missing goods. Criminals have for many years exploited this opportunity to make fraudulent claims. And almost inevitably the cost of this was largely deemed to be an acceptable loss by retailers. That is until recently. Now, with online volumes going through the roof (and levels of refund fraud with it) the loss is no longer one that can be “accepted”…
Since the pandemic fully 30% of people admit to making false claims of items not being received
Recent data shows that the pandemic has changed consumers’ “bad behaviour,” with 30% of the public admitting to making false claims of items not being received. And as online retail has grown at a rate of knots, so has the involvement of organised crime.
Multiple fraudulent refund claims are costing retailers tens of thousands of pounds every week. There are even professional refund fraudsters who will make a claim for someone for a fee/commission. They make a living out of committing fraud for other people! The situation is getting out of control.
Of course the problem with coming down hard on this type of crime is that the honest shoppers tend to get caught in the crosshairs too. Customers who have genuinely suffered can be subjected to an inquisition and overly long and laborious procedures. That is just not consistent with a good customer experience or the frictionless customer journey.
For the honest customer, what you consider to be “necessary” checks before making a refund are to the customer simply adding insult to injury. First you didn’t deliver and then you made it difficult to get the situation rectified. Unfortunately, they will shop elsewhere. So what can be done…
New system allows video verification of any pick at the touch of a button
Fortunately a new system, designed during the rapid rise in online trade (and associated rise in refund fraud) for one leading retailer looks set to revolutionise how refund fraud is dealt with by retailers. Not only does the solution allow retailers to check quickly, at the touch of a button, whether the customer is telling the truth, but it also makes for a better customer experience for those who have actually suffered from a service error.
The new system is called “PACKED.”
Quite simply PACKED stores a video record of every pick, pack and despatch. Then, if the completeness of the delivery is challenged, a member of your customer services team can quickly and simply key in the customer’s receipt number to instantly locate and watch the video record of that pick and decide if the customer is correct or mistaken. Brilliant!
Moving forward the system has the potential to be made available for the customer to use themselves. So in the event of a complaint the customer themselves can key in their receipt number online and watch the video showing them the pick!
Imagine being a legitimate customer on a customer service call being told, “I can see a video of your goods being despatched and can confirm that we made a mistake, which we will put right.” Think of the impact if you are a fraudster. And of course word will spread rapidly around the fraud community.
As well as providing video fulfilment confirmation of the final mile, the system also offers similar verification solutions for till line investigations and click and collect enquiries. And the simplification of the returns investigations offers huge savings in man hours as well as the fastest possible resolution of a customer’s query.
Of course preventing fraud is just one of the benefits of the system. Less refund fraud means better stock availability. And that means more sales. With a customer self-serve arrangement there will be fewer calls to customer services. And most importantly you can afford to be more generous to the legitimate complainants and invest in providing a service recovery that will truly impress the customer and give them bragging rights to spread across their entire social network.
In challenging times for retail, I believe the new PACKED system is a game changer in the fight against refund fraud. And this, together with the other benefits it brings, offers significant opportunities for the retail industry.