The COVID climate has prompted more shoppers than ever before to shift to digital channels. Today’s volume of new online shoppers is 2x greater than pre COVID-19 levels. However, these new online shoppers are 5-7x more likely to be declined by current fraud systems than returning customers, a phenomenon Forter has defined as New User Missed Opportunity (NUMO).
NUMO is FOMO manifested for e-tailers. No retailer wants to miss out on an opportunity to convert a potential buyer into a loyal lifetime customer. Data indicates that 40% of those that are declined on their first visit won’t try to make another purchase with the merchant’s site.
With online shopping volumes higher than ever, merchants simply cannot afford to lose out on these new customers.
Taking a deeper dive…*
Why are E-Tailers turning away these new users?
Current approaches to fraud prevention are not enough to keep up with shifting consumer behaviors and are limited by their lack of data. Merchants that only have a view into their own customer data stores rather than a robust global database spanning geographies, verticals, and customer behaviors, are less likely to have enough data or information to nimbly and accurately decision the transaction or customer interaction they see.
This results in:
- Increased false positives, especially for new users
- Increased friction leading to poorer customer experience and increased cart abandonment rates
Solving the challenge of NUMO
Instead of looking at fraud prevention from a risk aversion perspective, merchants should consider risk management as a way to approve more customers, capturing as much new revenue as possible – enabling and encouraging customer lifetime value (CLTV).
Download the full NUMO report here and see how NUMO may be impacting your revenue potential and how Forter can help you meet your business growth potential.