Is Your Retail Business Set for Single's Day?
Here we go again, Singles’ Day is upon us. For those of you who aren’t familiar with the event, Singles’ Day (November 11th) is China’s annual sales extravaganza. Originating in Nanjing University in 1993 as a sort of “Anti-Valentine’s Day”, it provides an opportunity for people who aren’t in relationships to celebrate their singledom. Why does it fall on November 11th? Simply because the date consists of four ones.
Over the past 25 years, the day has grown from a local event catering to young people, into an international phenomenon which is now the biggest offline and online shopping day in the world. With shoppers across the globe regularly spending more than $38.2 billion USD in the course of just 24 hours, Singles’ Day surpasses even Black Friday and Cyber Monday in terms of dollars spent.
Why is Singles’ Day so huge?
Driving the impressive rise in Singles’ Day sales is the adoption of the event by Chinese eTail giants Alibaba, Tmall and JD.com – all of which have a growing overseas presence. As a result, more and more Japanese and US merchants are jumping on the bandwagon, with some 40% of retailers who participated last year coming from outside China.
Another key reason behind Singles’ Day’s popularity is the proliferation of mobile payments in China and further afield. Mobile accounted for upwards to 90% of all processed transactions last year, and there is every indication this will continue to grow. If your business wants to capitalize on Singles’ Day sales, it’s important that you don’t just support payment platforms from other locales, but ensure acceptance of key eWallets, such as Apple Pay, Google and Amazon.
How is the event spreading internationally?
Regional, holiday-specific shopping days sometimes have a habit of spreading internationally – think of how Black Friday has grown in markets like the UK (where Thanksgiving is not celebrated). Therefore, the expansion of Singles Day in markets outside of China should be no surprise. As early as 2015, Costco was already the top selling merchant on TMall Global – having sold $3.14 million in an hour. US and international brands regularly attract most of the attention of eager shoppers, and more businesses are getting involved every year. In short, although still in its infancy, all merchants should take a moment to consider if they too should get involved.
What can we expect this year?
Shoppers from around the world are eagerly waiting for previews of the deals that will be on offer this year. But they aren’t the only ones hoping for a sneak peek – cyber criminals are excited too. They see this as the ideal opportunity to take advantage of customers, merchants and the banks.
Just like Black Friday, Singles’ Day always sees a pick-up in this kind of activity – fraudsters want to exploit the shopping pandemonium to dupe consumers for a big payday. They’ll use whatever means are available to them, using fake links and phishing techniques through all levels of media, from social to email and mobile channels, to snare vulnerable consumers and steal their payment details.
How can we protect consumers?
With the risks in mind, retailers need to do more to safeguard their customers from fraud. Above all, it’s crucial that your business works with banks to educate consumers in ecommerce safety, highlighting the importance of shopping at genuine retail sites, rather than allowing themselves to be drawn by the promises of a better deal to obscure sites.
Singles’ Day in particular brings with it many counterfeit products which, in turn, spur fraud claims from consumers. However, there is plenty of research showing that shoppers increasingly value quality over discounts, particularly when it comes to electronics and furniture. As a retailer, then, you should highlight the origin and the performance of your products on your website, and make sure that your product descriptions exactly match the item(s) being delivered.
Having clear terms and conditions, return and refund policies is also crucial to building customer confidence, along with a non-restrictive process to reach customer service (live chat, phone, etc.). These will help to avoid those dispute calls going into the issuers and becoming chargebacks.
How can we deal with chargebacks?
Even the best-prepared merchants have to deal with chargebacks – an inevitable consequence of any spike in revenue, especially on an ecommerce platform. Key to dealing with any chargeback is to ensure your business is prepared with plenty of compelling information on the transaction. This is vital to make sure you’re able to respond to any dispute in a timely manner.
Compelling information should be robust and contain enough data to support the rebuttal at the first opportunity to validate your customer. If the transaction is found to be truly fraudulent, it should not be fought from a merchant standpoint, as the chances of winning the representment are slim. This is part of the collaboration process where you want to work closely with issuers and respond to genuinely valid chargebacks.
For those merchants leveraging our Alerts solution, this provides the opportunity to review the transaction in question after the customer has called their bank to dispute the charge (and prior to the actual chargeback taking place) through direct collaboration with the issuer. Now you can stop fulfillment of goods or services, refund the customer and stop the chargeback before it happens. This will not only reduce fraud, but improve your chargeback ratio, enhance acceptance with the issuer and facilitate analysis to prevent future fraud.
What else do retailers need to do to prevent fraud?
Above all, it’s important to look at your fraud rules engine to ensure you’re able to meet any extra demand and reduce friction on the consumer side.
Make sure you have AVS in place, as well – this isn’t supported everywhere in the world, but can go a long way towards minimizing the risk of fraud. 3-D Secure is also a great anti-fraud tool, as it verifies customer identity for liability protection. It does add some friction to the payment process, especially in those parts of the world that do not subscribe, but version 2.0 next year aims to change that.
Other ways of protecting your business and customers from fraud is to restrict access from IP locations linked with fraudulent behaviour.
Always remember that the on-demand push of real-time authentication and fraud prevention is essential to avoid disruption to your business.
All set for Singles’ Day
Singles’ Day is a great opportunity not just to make money on the day, but to attract potential repeat customers for sales throughout the rest of the year. With a collaborative approach to combatting fraud, you and your business should be well prepared to take advantage of the event’s money-making potential.
幸福的单打日和很多成功 (Happy Single’s Day and much success)
If you want to understand how you can safeguard your business from fraud and chargebacks this Singles’ Day speak to our experts for more information, or book a free chargeback assessment, to receive personalized advice on how you can further improve your business’s chargeback procedures.