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Shopify Fraud Prevention Tips Every E-Commerce Business Owner Should Know

by John Morris
March 2, 2022
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Fraud is a huge concern for Shopify retailers. Shopify has built in parameters that are designed to prevent fraud, but not all online retailers have the time or resources to monitor their stores closely enough to catch every fraudulent order. This article will discuss why a Shopify fraud prevention app could be able to help you stop fraud before it starts on your Shopify store. ShopFox offers a Shopify fraud prevention app to Shopify retailers with no strings attached. It is a great tool for Shopify merchants and is a great solution that will keep your store protected.

A Shopify fraud prevention app helps protect Shopify stores from fraud by providing an app through which they are able to stop high-risk orders before they make it onto their order list. Whenever an order is flagged as “high-risk”, Fraudblock steps in to automatically cancel the order and restock your store inventory. The app also has an option to refund or void customer payment, saving you time by managing the potential fraud without any manual input from you. 

This allows you to quickly catch and cancel fraudulent orders while also preventing other customers’ personal information from being compromised. A Shopify fraud prevention app will also provide you with the ability to monitor customer behaviour and discover new signs of fraud that may be affecting your store, thus helping keep your Shopify store protected without taking too much time out from managing it yourself.

What Damage can Fraudulent Orders Do?

A fraudulent order on Shopify not only costs you time, but also money and valuable stock. If you’re a small business owner, then shipping products can be costly. Consistent fraudulent orders could put a serious dent in your profits and even cost you money if it turns out that the customer tried to purchase items with no intention of paying for them.

Monthly chargebacks from customers who didn’t receive what they ordered add up quickly too: not only do these charges take away from revenue but also make advertising messages less effective because junk data will seep through advertisers’ marketing channels (no one wants lookalikes flooding their audiences). This all adds up – so making sure tracking numbers are accurate before sending anything off ensures peace of mind.

What counts as a Fraudulent Order?

Shopify’s fraud detection system is advanced. There are a few clear indicators that can help you understand if an order might be fraudulent, but it’s not as simple as one big ‘smoking gun’.

From time to time there will be single factors to identify whether or not an order was placed fraudulently, however these don’t happen often enough for the company’s algorithm to detect them on its own and react accordingly (in other words: too many clues point away from validity). It requires judgement beyond what we may think of first when trying hard evidence like spelling errors in products’ names, unusually long delivery times given during checkout process etc..

The Vast Majority of Fraudulent Orders are for a significantly higher-than average order value. However, beware to fraudsters who test the water by ordering small then following up with an even larger amount once their first attempt appears successful.

Shopify Fraud – What to Look Out For

The following are the most common types of online fraud today that you will need to be aware of in order to protect your Shopify store: 

  • Unusually high order values 
  • Multiple orders placed with different email addresses, credit cards or IPs within a short time frame 
  • Orders being shipped only after payment has been confirmed by customers (fraudsters love this one) – scammers know they won’t get their money back so try and ship as soon as possible before other people start seeing what is going on.

Shopify Fraud Prevention – Our Summary

Shopify’s Fraud tool is a great start to understanding the risk in your orders. What we have covered here, and what comes next after a fraudulent order or one that looks suspicious has been flagged by our team of experts (or if it hasn’t), will help you analyse and build cases around those risks so as not be taken advantage by would-be fraudsters who want nothing more than their money back.

With a Shopify fraud prevention app you will be able to monitor customer behaviour and discover new signs of fraud that may be affecting your store, thus helping to keep Shopify stores protected without taking too much time out from managing it yourself.

John Morris

John Morris

He is a tech enthusiast who loves to be updated with the latest industry trends. As a writer, his favorite area of writing is Tech, Mobile apps, Business, and Reviews.

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