Thursday , June 20, 2024

Consumers Expect More E-Commerce Fraud During the Holidays, And They Blame Marketplaces

The risk of being defrauded by online sellers is a major concern for consumers this holiday-shopping season, according to a survey by Socure Inc., a provider of identity-verification and fraud-detection technology. And consumers are poised to blame not just the fraudulent sellers, but the marketplaces that host them, the survey indicates.

Of the more than 1,500 consumers surveyed, 31% cited goods not being delivered as their biggest fear when shopping online this season. Twenty-four percent listed seller fraud, and 18% cited being sold counterfeit items. New York City-based Socure conducted its survey between Thanksgiving and Cyber Monday.

In addition, 51% of respondents expressed reservations about making online purchases from sellers unknown to them, as opposed to purchasing from a brand name retailer such as Best Buy, Target, or Walmart, or from a known local merchant, out of fear they could be defrauded.

Despite concerns about online seller fraud this holiday season, consumers say they will hold the marketplace housing the fraudsters’ stores accountable for any losses. When asked how likely it is that they would shop again on a marketplace through which they purchased a hard-to-find luxury item that turned out to be counterfeit, 70% said they simply would not shop at that marketplace again. When asked about a case in which the same item is never delivered due to seller fraud, 72% said they would not do business with the marketplace again. 

Consumers indicated they will take the same hardline attitude when it comes to low-dollar-value purchases, with 65% of respondents saying they would not shop at a marketplace again after purchasing a counterfeit, generic item valued at $5 or less. Sixty-six percent said they would never do business again with the marketplace if the item was never delivered due to seller fraud.

Overall, 52% of consumers said they expect more e-commerce fraud this holiday shopping season compared to 2020, while 33% said they expect about the same amount. Among the reasons they expect more ecommerce fraud this holiday season, 33% cited an increase in online transactions and 21% pointed to what they perceive as high risk within e-commerce platforms.

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