Purchasing online sounds like a time-saving, automatic process with plenty of fringe benefits, right?

But on the flip side, there’s the possibility you could be opening the door to more than you bargained for — online fraud.  OK, one solution is to check many of the orders manually, to make sure no one’s trying to sneak one by you. But doesn’t manual order-checking defeat a lot of the labor-saving purpose of online ordering?

Fortunately, you’re not the only one facing this situation — which means there’s some guidance from your peers in how they handle the risk of online fraud. For other companies, what is the best safeguard?

CyberSource’s 2008 Online Fraud Report reveals just how many companies are using the best practice:

• 82% of companies that sell online manually review orders, and
• The manual review rate is 27% (up from 23% over the prior year), about one in every three online orders.

What fuels this level of interest? Research reveals that 1.3% of orders received online are fraudulent, and dip directly into your pocket. With this in mind, you need to devote some staff time to oversee the ordering process through your Web site. It’ll take a bite out of the convenience and time you gained with online ordering, but it’s still a necessary part of protecting yourself. Bottom line, you should still finish ahead.

Fast forward: You’ve received a fishy-looking order through your Web site. You need to check it out for accuracy — but the pressure is on to turn over orders quickly. What takes higher priority: Your need to verify the veracity of the order, or the perceived need to please the customer?

Making this is the kind of decision is a task you need to share with the higher-ups, whether it’s CFO, Sales, Finance VP, etc. Once you get the guidelines (hold the order for 3 days, for 7 days, etc.), you’ll have most of the guidance you need.

The average: two to three business days. Some companies will remain in a holding pattern for 10 days; other may charge ahead in one work day. 

Tags: customer, fraud, online, order