case studies
smartfraud helps a leading online retailer find 80% of fraud in the top 20% propensity to be fraudulent postcodes, reducing fraud losses and improving delivery times.
The Brief
An online retailer of 'high value' computer equipment was experiencing significant fraud losses from 'goods lost in transit'. They tasked Jaywing to deliver a solution to reduce these losses without impacting customer experience or delivery times.
The Deliverables
smartfraud identifies and protects against fraud throughout the customer lifecycle and in this case it was implemented at the delivery stage. Customer addresses were screened against the postcode level fraud model, identifying addresses with a high fraud propensity. This allowed the retailer to determine the most relevant delivery method for high risk customers.
The retailer's policy of allowing delivery to alternative addresses was an important customer service element, so It was vital that this be continued. smartfraud was able to highlight discrepancies between the billing and delivery addresses. If the billing address had a low fraud propensity and the delivery address a high fraud propensity this may be indicative of an attempted account takeover.
For any high risk customers the retailer was able to investigate the case further and find out if the order and address details were legitimate before attempting delivery.
The standard smartfraud score is based on a database of over 100,000 known fraud cases, combined with a range of other data including lifestyle variables. Jaywing enhanced the predictive power of this model further by incorporating the client's own fraud outcome data, as well as recommending optimal delivery rules.
Implementing smartfraud required no IT resource and easily integrated into the retailer's existing processes.
The Results
Over 50% of fraud was found in the top 10% of the postcode file and 80% of fraud was found in the top 20% of the postcode file. Using their own outcome data, bespoke scoring enhanced the power of the score even further.
The retailer saw a significant reduction in fraud losses, combined with an improvement in delivery times as low risk customer orders could be dispatched straight away. It also ensured the company's policy of delivering to alternative addresses could be continued by negating the fraud risk associated with this practice.
