# Cutting-Edge Order Automation: Retailers’ Secret Weapon for Success This Christmas
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2021-12-03
Category: BUSINESS
Category URL: https://financedigest.com/category/business
Meta Title: Boost Your Christmas Sales with Automated Retail Fraud Detection
Meta Description: This Christmas, retailers face challenges of online fraud and returns abuse. Learn how AI and technology can help combat fraud and improve sales this holiday
URL: https://financedigest.com/cutting-edge-order-automation-retailers-secret-weapon-for-success-this-christmashtml

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_![Ed Whitehead, MD EMEA, Signifyd](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/254-1736836712774-compressed.jpg)_

_By **Ed Whitehead,** MD EMEA, Signifyd_

This Christmas is the opportunity for retailers to make up for a turbulent couple of years with all shops open and trading, and customers planning for bigger and better celebrations than last year.

Sales, especially online, are already brisk and widely expected to become yet more robust the closer we get to the big day. A good Christmas season on [average accounts for 20% of annual](https://www.financedigest.com/average-annual-uk-food-bill-set-to-rise-454-pounds-as-inflation-soars.html "Average annual UK food bill set to rise 454 pounds as inflation soars") revenue for retailers, and for some much more than that.

Unfortunately, it’s not all good news for retailers.

In the lead up to Christmas, there has been a  growing headache of online fraud, including fraudulent and abusive returns. So much so, that more than two-fifths of UK and U.S. [retailers said they’d seen an increase](https://www.financedigest.com/omv-q3-retail-and-commercial-margins-increased-q-q.html "OMV: Q3 retail and commercial margins increased q/q") in returns abuse and fraud, according to WBR Insight’s “The eTail Guide to Retail Automation.”

That’s a worrying trend this holiday season, [despite the growth](https://www.financedigest.com/euro-zone-credit-growth-remains-brisk-despite-gloomy-outlook.html "Euro zone credit growth remains brisk despite gloomy outlook") of AI and machine learning to combat the problem. Amid all the holiday hustle and bustle, some oversight unavoidably tends to be compromised.

**With Challenges, Come Solutions**

Many sizable retailers are aggressively adopting the aforementioned technologies and [reaping the benefits](https://www.financedigest.com/can-finance-reap-the-benefits-of-the-cloud-without-compromise.html "Can finance reap the benefits of the cloud without compromise?"), according to the WBR Insights research team that recently surveyed 200 retail leaders across the United Kingdom and the United States. Even if, as expected, the number of successful episodes of [fraud rises this Christmas](https://www.financedigest.com/scam-special-how-to-avoid-christmas-shopping-fraud-this-year.html "Scam Special: How to Avoid Christmas Shopping Fraud this Year") season, it would be much worse without the benefit of cutting-edge technology. And judging from the findings of the WBR Insights report, the stage may be set to [reduce online fraud](https://www.financedigest.com/how-can-you-reduce-the-risk-of-fraud-in-b2b-payments.html "How can you reduce the risk of fraud in B2B payments?") in coming years.

One telling insight gleaned from WBR research is that 61 percent of the retail leaders polled already employ technology-driven automation for [fraud detection](https://www.financedigest.com/the-clues-to-detecting-fraud-are-hidden-in-relationships.html "THE CLUES TO DETECTING FRAUD ARE HIDDEN IN RELATIONSHIPS"), and another 36 percent plan to do so in the next six months. Meanwhile, 89 percent are already employing some aspect of [automation for order management](https://www.financedigest.com/adopting-ai-balancing-automation-with-risk-management.html "Adopting AI: balancing automation with risk management"), fulfillment or confirmation. Two significant benefits of order automation, the [report says](https://www.financedigest.com/loreal-denies-report-saying-it-suspended-twitter-ad-spending.html "L’Oréal denies report saying it suspended Twitter ad spending"), are a reduction of human errors and a reduction of fraudulent credit card chargebacks.

Many [survey respondents also said that automation has generally made](https://www.financedigest.com/half-brits-taken-pay-cut-job-made-happier-according-wrike-survey.html "Over half of Brits have taken a pay cut for a job that made them happier, according to Wrike survey") their operations more productive. By replacing manual processes with automated ones, they have been able to concentrate more on business-critical objectives. Automation even helped companies pivot during the heart of the pandemic, they contend.

**Retailers All** [Need To Make Improvements](https://www.financedigest.com/what-banks-need-to-do-right-now-to-improve-their-digital-services-without-sacrificing-security.html "What Banks Need to Do Right Now to Improve Their Digital Services Without Sacrificing Security ")

For one thing, huge [data breaches](https://www.financedigest.com/10-steps-to-stop-lateral-movement-in-data-breaches.html "10 Steps to Stop Lateral Movement in Data Breaches") remain distressingly common, and they come with collateral damage. Stolen regularly from millions of people are their names, credit card numbers,  email addresses and other personal details,  and this [data is typically sold by third parties](https://www.financedigest.com/new-gleif-challenge-facility-extends-ability-to-trigger-updates-of-legal-entity-identifier-data-to-all-interested-parties.html "New GLEIF Challenge Facility Extends Ability to Trigger Updates of Legal Entity Identifier Data to All Interested Parties") on the Dark Web. The more personal identifiable information out there, the more opportunities [hackers have to commit fraud](https://www.financedigest.com/santander-scam-avoidance-school-sas1-graduate-turns-ethical-hacker-to-help-the-fight-against-fraud.html "Santander Scam Avoidance School (Sas)1 Graduate Turns Ethical Hacker To Help The Fight Against Fraud").

In addition, some organizations have found it difficult to scale order automation, the WBR Research report says, mostly due to difficulties in updating technology among organizations that have long been operating proprietary [legacy systems](https://www.financedigest.com/retailers-weighed-down-by-their-own-legacy-systems-survey-reveals.html "Retailers Weighed Down by their own Legacy Systems, survey reveals").

These systems – some built in-house – sometimes can’t be replaced. More frequently, however, vendors can assist in developing APIs and other workarounds, enabling the companies to [reap the benefits](https://www.financedigest.com/uk-tourism-sector-already-reaping-the-benefits-of-brexit.html "UK TOURISM SECTOR ALREADY REAPING THE BENEFITS OF BREXIT") of new automation tools without sacrificing their essential systems.

The [growing incidence of chargeback fraud](https://www.signifyd.com/ecommerce-pulse-data/2021-eu-fraud-report/) is also somewhat troubling. The hope is that this will eventually be contained by the [expansion of appropriate AI and machine learning tools being directed at the problem by a new breed of commerce](https://www.financedigest.com/managing-trade-credit-and-insurance-in-the-context-of-international-commerce-expansion.html "Managing trade credit and insurance in the context of international commerce expansion ") protection providers.

**There’s More To [Fraud Protection](https://www.financedigest.com/protect-your-organisation-from-fraud.html "Protect your organisation from fraud") Than The Tools**

Retail chains don’t want to be overly conservative and decline orders that are legitimate. A study by Javelin Strategy and [Research concluded that 30 percent of orders declined for fear](https://www.financedigest.com/fear-of-failure-holding-back-british-entrepreneurs-new-research-finds.html "Fear Of Failure Holding Back British Entrepreneurs, New Research Finds") of fraud were actually legitimate. Consumers victimized by such false declines resent such treatment. On the other hand, [retailers need](https://www.financedigest.com/high-street-crisis-why-retailers-need-to-focus-on-in-store-ux.html "High Street Crisis: Why Retailers Need to Focus on In-Store UX") to crack down on scams.

For example, so-called item-not-received fraud – in which consumers claim they never received their online orders even though they did – is accelerating and tends to be much costlier than [credit card](https://www.financedigest.com/more-bang-for-your-buck-with-debenhams-credit-card.html "More Bang For Your Buck with Debenhams Credit Card") fraud.

Also [common is so-called multi accounting](https://www.financedigest.com/5-common-mistakes-around-accounts-payable-automation.html "5 Common Mistakes Around Accounts Payable Automation"), in which fraudsters create multiple accounts to better capitalize on promotions, such as credit card bonus credits. [According to the WBR Insights report](https://www.financedigest.com/global-natural-disaster-losses-reach-45bn-during-1h-2018-insurance-payouts-estimated-at-21bn-according-to-aon-catastrophe-report.html "Global natural disaster losses reach bn during 1H 2018; insurance payouts estimated at bn, according to Aon catastrophe report"), 63 percent of respondents are specifically automating the review of fraudulent orders.

In the past, says WBR Insights, retailers and other [online vendors](https://www.financedigest.com/online-marketplaces-embracing-embedded-finance-to-benefit-both-customers-and-vendors.html "Online marketplaces: embracing embedded finance to benefit both customers and vendors     ") were concerned about fraud review because of the risk that these systems incorrectly declined legitimate orders. The [technology behind](https://www.financedigest.com/what-is-generative-ai-the-technology-behind-openais-chatgpt.html "What is Generative AI, the technology behind OpenAI’s ChatGPT?") this type of software has substantially advanced, however.

As online retailing continues to flourish, there is no question that order automation is critically important to be competitive. And as the WBR Insights report outlines, [retailers in large part agree with this proposition](https://www.financedigest.com/rethinking-retail-banking-embracing-a-customer-centricvalue-proposition.html "Rethinking retail banking: Embracing a customer-centricvalue proposition"). But they have to be careful in the use of their tools. According to a 2019 Signifyd [Customer Experience](https://www.financedigest.com/the-new-client-adviser-experience-in-the-age-of-the-customer.html "The New Client-Adviser Experience in the Age of the Customer") survey, two-thirds of respondents said they would never shop with a retailer again if their order was incorrectly flagged for fraud. This is a huge [price to pay](https://www.financedigest.com/shell-energy-to-pay-for-overcharging-price-cap-customers-ofgem.html "Shell Energy to pay for overcharging price cap customers -Ofgem") for one mistake.


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