Fraudulent Bots: How to Stop Them Meddling in Your Business
Fraudulent Bots: How to Stop Them Meddling in Your Business
Learn about the dangers of bots in enabling fraud, as more and more shops take their business online. With 45% of businesses citing the cost of addressing bot attacks as a top concern, learn how to reduce the impact of bot fraud on your business.
Picture the scene. Your favorite music artist is going on tour. Finally! You’ve been wanting to see them in concert for as long as you can remember. You’ve turned on email notifications for the ticket release, and you’re primed and ready to snatch up those tickets for yourself and your friends. You’ve set an alarm so you’ll be ready on the ticket drop, and you’ve checked and double checked that your Wi-Fi connection is lighting up all three glorious signal bars on your laptop. You are perfectly prepared to get those tickets.
The time comes and you click the button to buy the tickets. The dreaded notification pops up on your screen. This item is unavailable. That cannot be right, you think to yourself. You try again, refreshing your browser. Your heart rate quickens. And then, the nightmare is confirmed. Somehow, in under a fraction of a second, all the tickets are gone. The website glitches and freezes up. None of your friends, who all also tried to secure tickets, were successful either. You cry into a punnet of ice cream. There are already new sites popping up, reselling the tickets for the concert, at a ridiculously inflated price that none of your friends can afford.
How can this possibly happen so unbelievably fast?
The answer is simple: Bots. Bots can perpetuate various types of online fraud, including what is known as inventory fraud, as previously described in the sad little anecdote above, usually committed by what are known as sniping/ scalper bots.
So, what are bots? Are they robots?
Essentially, yes. Bots are automated programs that can perform various tasks online. In the context of online shopping, as the concert example illustrates, sniping bots can be used for fraudulent activities such as hoarding high-demand concert tickets and reselling them at inflated prices.
The Shift to Online Shopping
The increase in online shopping (and the decrease in usage of high street stores) has given bots far more power than they ever would have had before. High street stores are struggling, while more internet businesses and online shops are popping up and becoming successful. The COVID-19 pandemic had a large part to play in speeding up this shift to online shopping, as, with self-isolation and shops shutting for long periods of time, people were less able to shop on the high street. According to the Office for National Statistics (ONS), online retail sales reached a record high of 36.1% of all total sales in the UK in January 2021, which showed a substantial increase in online shopping compared to pre-pandemic levels. In addition, retail footfall (numbers of people out on the high street) decreased by around 43% in the UK in 2020, compared to the previous year, as reported by the British Retail Consortium.
This tangible shift has meant that online shopping is a bigger part of our daily lives, which puts more people at risk of being victims of online bot fraud.
The Significance of Customer Experience (CX)
A positive customer experience with your website or app will lead to higher customer satisfaction and loyalty to your business. Customer experience (CX) has become even more important to online retailers, as online retail becomes a more crowded market, due to the shift, and businesses hone their e-commerce sites.
Users now have high expectations of online retail websites and mobile apps. They expect to encounter websites and apps that are easy to use, intuitive and fast. If a website or app is difficult to navigate or slow to load, users are likely to abandon it and seek alternatives, which they will easily find, with so many online retailers available. This is why bot prevention is even more critical than ever, to ensure that your business does not lose customers, and thrives in the online marketplace.
Types of Bot Fraud
Bots are responsible for different types of online fraud, including:
- Inventory Fraud
This is when sniping and scalper bots hoard high value, often limited-edition, products, such as the concert tickets in the anecdote, and resell them at inflated prices. Naturally, this is frustrating and disheartening for genuine customers who struggle to purchase these items online without having to resort to third-party sellers.
- Card Fraud
Bots use credit card skimming techniques to steal card numbers during payment transactions, which can lead to fraudulent purchases and chargebacks. Again, this is upsetting for customers, as they can lose money, and dangerous for genuine businesses, as customers lose trust in buying from them online.
- Account Fraud
This involves bots using malicious coding to steal the login details of real people. With this information, bots can access customers’ accounts, steal personal data, and make unauthorized purchases.
Impact of Bot Fraud
Bot fraud can have vast and severe impacts, on both the online retail companies internal workings, and the users and customers which the bots attack.
Impact on Online Retailers:
- Overburdened IT departments. Dealing with automated threats can overwhelm IT teams, leading to burnout and reduced efficacy.
- Increased operating costs. Fighting bot attacks can be expensive, with 45% of businesses citing the cost of addressing bot attacks as a top concern.
Impact on Customers:
- Loss of trust. Bot attacks lead to customers losing trust in a business, and make them question the security of their data online.
- Customers become frustrated and upset. Bots slow down websites, cause glitches, steal from customers, and prevent genuine customers from accessing desired items, like the concert tickets, which results in lower user satisfaction.
Benefits of Bot Management & Protecting Your Online Business
In order to prevent the negative impacts of bots, effective bot management is crucial for the modern day online business.
By blocking bots, websites and mobile apps are able to work faster, with fewer disruptions, improving the user experience.
Preventing Bot interference in your website/ mobile app will lead to:
- Higher user satisfaction: Genuine customers have a better chance of securing high-demand products, boosting satisfaction and loyalty.
- Trust and data security: When bots are blocked, users can trust that their data is safe, reducing the risk of fraud.
Businesses should, therefore, invest in a comprehensive bot management solution that cover websites, mobile apps, and APIs. These solutions should be responsive, adaptive, and capable of addressing various types of attacks. By effectively mitigating bots, you can improve user experiences, enhance customer retention and reduce the risk of online fraud.
