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Online Merchants

In ecommerce digital goods is a general term that is used to describe any goods that are stored, delivered and used in its electronic format. Digital goods are shipped electronically to the consumer through email or download from the Internet.

Examples of digital goods include e-books, music files, software, digital images, gaming, gambling, online dating, ticketing, financial services, website templates, manuals in electronic format, and any item which can be electronically stored in a file or multiple files.

Digital goods may also be called electronic goods or e-goods or electronic services or e-services.


Typical issues facing Digital Goods Merchants that result in lost revenues, fraud losses and chargebacks:

  • Since most digital goods are delivered at the time merchants accept the transaction, merchants don’t have the ability to stop shipment, and few even can revoke a license.

  • All merchants want to make sure ‘customers’ are really who they say they are.  This is a challenge for digital goods merchants since a shipping address is typically not part of the order. Digital goods merchants, unlike physical goods merchants, rely almost entirely on their electronic footprint e.g., device ID.

  • Another common issue is merchants tracking down whether users are creating and using multiple accounts.  In many cases multiple accounts are indicative of fraudulent activity (e.g., banned users returning under different names, users creating multiple accounts in an attempt to use different stolen cards), or simply to violate the merchant’s terms of services.

Benefits of Ethoca Alerts for All Digital Goods Merchants:

  • Avoid the entire chargeback process.  No chargebacks.  No chargeback fees. No chargeback processing costs!

  • Avoid the financial loss by stopping the fulfillment on goods and services where possible (e.g., locking account, revoking license) on orders you’ve already accepted and currently processing.

  • Dramatically improve the productivity of your manual review team by quickly cancelling those orders confirmed by the cardholder as fraud.

  • Be alerted to fraud attacks and account take over sooner, thereby lessening the financial impact of the overall attack.

  • Improve fraud screening by incorporating cardholder-confirmed fraud much sooner in your fraud tables.

  • Improve user experience for your customers by reducing unwanted user activity.

  • Protect your brand.

Gaming

Gaming merchants face a number of unique challenges.  Fraudsters that target the gaming industry tend to be sophisticated, resourceful and well prepared.  False identifies, use of proxies, use of multiple computers or ISP connections, and organized gangs makes the challenges unique for a wide range of gaming merchant types that Ethoca can greatly benefit:

  • MMOG (Massively Multiplayer Online Game)

  • Role Playing

  • First Person Shooter

  • Puzzle

  • Strategy

  • Racing

  • Simulation

Gambling

Online gambling merchants (i.e., operators) face a unique set of issues ranging from well-equipped fraud rings use gambling and betting sites to cash-out stolen credit cards, to simply friendly fraud (i.e., 1st party) looking for a free spin of the wheel!  And to further exacerbate the issues, it’s a high-competitive market making marketing and customer service highly differentiating factors for gambling merchants of all types that Ethoca can greatly benefit:

  • Casino

  • Poker

  • Bingo

  • Sports betting

  • Lottery

Services

Online services merchants, like other digital goods merchants, have the challenge of doing business where no physical contact is required during sale or fulfillment.  Ethoca is benefiting online services merchants in wide ranging business including:

  • Business Services e.g., domain names, business registration service

  • Creative Services e.g., website development, copy writing

Ticketing

Online ticketing is also commonly known as electronic ticketing (also abbreviated as e-ticket). The term is most commonly associated with airline issued.  Ethoca, however, importantly differentiates between airline tickets and those e-tickets that service more generally as admission tickets.  Ethoca is benefiting online ticketing merchants:

  • Entertainment e.g., movies, concerts, theatre

  • Travel/Transportation e.g., bus, train passes

Financial Services

Financial services merchants are constantly under pressure to maintain compliance with regulatory requirements while striving to strike the balance of managing risk of financial loss with the speedy provisioning of money.  Ethoca is greatly benefiting a wide range of financial services merchants including many of the following:

  • Payday Loans

  • Money Transfers

  • Currency Exchange

In ecommerce physical goods is a general term that is used to describe any goods that are stored, delivered and used in their physical form. Physical goods are shipped to the consumer typically via mail or courier.

Some examples of physical goods include clothing, shoes, electronics, computer, books, jewelry, food and cars.

Typical issues facing Physical Goods Merchants that result in lost revenues, fraud losses and chargebacks:

  • Wrongly rejecting good orders.

  • Achieving and sustaining an acceptable fraud level while maintaining a positive customer experience.

  • On average with 1 out of 4 orders are being manually reviewed, companies will be challenged to screen more orders with the same resources and budget (CyberSource 2013 Online Fraud Report).

  • Integrating and managing an abundance of fraud tools.

  • Chargebacks

  • Expanding in to new markets.

  • Brand value negatively impacted if an active black market exists for a merchant’s goods.

Benefits of Ethoca Alerts for Physical Goods Merchants:

  • Avoid the financial loss by stopping the fulfillment of physical goods on orders you’ve already accepted and are currently processing.

  • Avoid the entire chargeback process.  No chargebacks.  No chargeback fees. No chargeback processing costs!

  • Dramatically improve the productivity of your manual review team by quickly cancelling those orders confirmed by the cardholder as fraud.

  • Be alerted to fraud attacks and account take over sooner, thereby lessening the financial impact of the overall attack.

  • Improved fraud screening by incorporating cardholder-confirmed fraud much sooner in your fraud tables.

  • Improved the user experience for your customers by reducing unnecessary transaction rejections and cancellations.

  • Protect your brand.

General Merchandise

The offering of general merchandise through an online store using a pick-pack-and-ship model from warehouses shipped to end-users.  Ethoca can greatly benefit merchants selling:

  • Clothing/Apparel

  • Homewares

  • Hardware

  • Sporting Goods

  • Novelty

  • Office Supplies

Luxury/High Value Goods

The offering of luxury/high-value goods sold online.  Ethoca can greatly benefit merchants selling:

  • Jewelry

  • High-end luxury brand apparel

Computers & Electronics

Computers and other consumer electronics sold online and shipped to purchaser from direct or indirect suppliers.  Some examples of these types of goods that Ethoca can greatly benefit the merchant would include:

  • Computers

  • Home Electronics (TV, Stereo)

  • Peripherals

  • Non-Download Software

Food Delivery

Food delivery would include the online sale and delivery of perishable and non-perishable food items.  Some examples of these types of goods that Ethoca can greatly benefit the merchant would include:

  • Groceries

  • Meal Services

  • Fast Food

Online Auctions

The purchase of goods and services from individuals or distributors online where price is determined by a bid or set price (e.g., eBay).

Automotive

Automotive goods sold online and shipped directly to purchaser from direct or indirect suppliers. A couple examples of these types of goods that Ethoca can greatly benefit the merchant would include:

  • Parts

  • Service

In ecommerce, airlines and travel are general terms used to describe travel related goods and services sold online to consumers and business such as airline tickets, car rentals, hotel rooms, cruises, rail tickets, and vacation and package tours.

Typical issues facing Airlines and Travel Merchants that result in lost revenues, fraud losses and chargebacks:

  • The perishability of inventory, such as airline seats, and razor thin profit margins makes fraud costly.

  • Lost revenue due to wrongly rejecting good orders.

  • Achieving and sustaining an acceptable fraud level while maintaining a positive customer experience.

  • Increasing number of orders being manually reviewed, airlines and travel merchants will be challenged to screen more orders with the same resources and budget.

  • Integrating and managing an abundance of fraud tools.

  • Chargebacks.

  • Expanding in to new markets.

Benefits of Ethoca Alerts for Airlines and Travel Merchants:

  • Avoid the financial loss by stopping the fulfillment of goods and services on orders you’ve already accepted and are currently processing.

  • Avoid the entire chargeback process.  No chargebacks.  No chargeback fees. No chargeback processing costs!

  • Dramatically improve the productivity of your manual review team by quickly cancelling those orders confirmed by the cardholder as fraud.

  • Be alerted to fraud attacks and account take over sooner, thereby lessening the financial impact of the overall attack.

  • Improved fraud screening by incorporating cardholder-confirmed fraud much sooner in your fraud tables.

  • Improved the user experience for your customers by reducing unnecessary transaction rejections and cancellations.

  • Protect your brand.

Ethoca’s flagship service, Ethoca Alerts, is a very simple yet incredibly valuable service for merchants that immediately and proactively notifies them of impending chargebacks. Countless times a day card issuers around the world confirm fraudulent and/or identify suspicious transactions with their cardholders that have gone through merchants’ system undetected - resulting in the unnecessary and burdening costs of chargebacks.

Ethoca Alerts close the information gap between the merchants and the card issuers, ensuring merchants have access to the information they need in a timely manner to be able to act quickly and avoid chargeback entirely.

The Process