2021 holiday shopping season is just weeks away. It's time for retailers to prepare for fraud and automated bot attacks for this coming peak season. In this article, you will learn what pandemic did to the holiday shopping season in 2020, and how to make plans for this year's e-commerce fraud peak season.

1. COVID Changed 2020 Winter Holiday Shopping Season

Here are three main ways the pandemic changed the winter holiday shopping season in 2020. Some of them may seem inspiring, but there are also threats hidden under the boom.

1.1 More Online Stores and Revenue Generated

The pandemic has changed the way consumers shop in the past year and also accelerated the shift towards online selling for most retailers. Amid the slowing economic growth during the pandemic in 2020, the e-commerce industry saw a surge in both the number of online sellers and total sales revenue.

Statistics show that e-commerce's share of total holiday sales spiked in 2020, especially during the short period between Halloween and New Year. Compared with previous years, the growth of online holiday sales would not reach this point in a pandemic-free world until 2022.

Source: Digital Commerce 360

1.2 An Early Start of Holiday Sales

Retailers started holiday sales earlier than ever last year both online and offline. The first shot was fired by Amazon. Due to the concern about Covid-19, Amazon postponed its Prime Day sale to mid-October which is usually held in July. Major offline retailers, like Walmart and Target, started to offer holiday deals at the same time.

For offline sellers, an early start means longer sales, so they could provide more time for consumers and hope to avoid in-store crowds when the pandemic was still a threat. For online retailers, like Amazon and Best Buy, longer holiday sales mean longer time for shipping, so they could have extra time to manage the orders when there was a shortage of staff during the pandemic.

Source: Criteo

1.3 A Sharp Increase in Online Fraud

The booming of e-commerce of course drew everyone's attention when other sectors were suffering from Covid. The surging revenue and long period of holiday sales also attracted unexpected online fraud.

According to statistics from TransUnion, 37% of consumers surveyed globally at the end of 2020 admitted that they had been targeted by digital fraud during Covid. It is a 28% increase from the same survey at the start of 2020.

2. What's New in 2021 Peak Shopping Season

2.1 Last Year's Pattern Continues

As the Covid-19 variant is still a big concern worldwide, the online shopping pattern may remain the same during 2021 winter holiday sales. Many consumers expect to continue the digital habits adopted during the Covid-19 outbreak, and 53% of the respondents plan to shop more online, according to a UN survey.

2.2 Automated Fraud Attacks Increase

The pandemic brings a golden age for cybercrime and fraud. Online retailers have optimized the shopping experience for customers in the past year, making it easy for everyone to buy things online. However, the more ways to shop and pay, the more loopholes fraudsters can take advantage of.

Sophisticated fraudsters have been playing their tricks for a while, and they are constantly renewing their techniques and sharpening their "knifes" for the coming peak shopping season.

3. Lessons Learned from Last Year

People learn from their mistakes. Last year's holiday shopping boom may have been unexpected, but there are still weeks away till 2021 holiday sales, which means if you are an online retailer, you still have enough time to prepare for the coming fight. Things you need to know are all listed below.

3.1 Optimize Customer Experience

Online retailing platforms, both websites and apps, have security mechanisms to protect themselves and customers, some of which are deployed in login and checkout pages to make sure only the real customers get the product rather than fraudster's bots. The most common and effective method that retailers take is CAPTCHA.

However, an irritating and time-consuming CAPTCHA would not help at all, and it may even harm the business. Once consumers can not pass the annoying "choose the _" image-based CAPTCHA, they may lose purchase intention. Statistic from ClearSale shows that 39% of customers won’t come back to an online store that rejects their payment in checkout sessions.

A CAPTCHA that balances security capability and user experience, like Slide CAPTCHA, is what brings you both the sense of being protected and a better customer impression.

3.2 Offer Holiday Deals & Discounts

Deals and discounts are indispensable in holiday sales. But once the deals are offered, fraudsters are ready to release automated bots to exploit the benefits. Common ways that bad actors use are gift card cracking and scalping. They would get valid gift cards first via brute force attacks, and then use automated programs to buy the most sought-after products with the gift card or just use scalping bots to empty the seller's inventory.

As long as retailers plan for deals and so on, they should prepare for the threat mentioned above. CAPTCHA does a good job in those cases. It would stop automated bots from purchasing when sellers installed it in add-to-cart and checkout pages.

GeeTest Adaptive CAPTCHA offers 7 challenge types to meet authentication requirements during the whole purchasing process online, from login to checkout.

Intelligent Mode - zero user friction with a high level of security capability

CAPTCHA challenges for all situations

3.3 Get Your Website Ready for a Traffic Surge

The holiday shopping season means a spike in traffic. More traffic means slower loading websites and impatient customers. To ensure a better shopping experience and conversion rate, retailers should take care of the loading time during the peak shopping season.

However, not all traffic spike is a good thing. Imperva found that there was 25.6% of bad bot traffic in 2020. This finding makes it easier for retailers. Block the bad bot traffic, and the slow loading problem is solved.

CAPTCHA is born for traffic management. It separates human traffic generated by real users from bot traffic created by automated bots.

3.4 Make a Plan for Real-Time Traffic

Responsible retailers must have already adopted risk control systems for their websites. Is that enough? Of course not. Holiday shopping is a seasonal thing. The risk level changes every day, even every hour during the peak seasons. A risk control system needs to constantly update its security strategies to fit real-time situations, which could be quite troublesome for retailers to adjust the rules every now and then.

GeeTest Adaptive CAPTCHA offers 7-layer protection, and each of them can automatically be combined with each other, providing up to 4274 security strategies according to different risk level visitors and different user behavior. It is the most agile and smart CAPTCHA product with bot managing capability you can find.

4. Final Words: Learn From the Best

GeeTest has been a crucial player in the cyber security industry for 9 years. It serves 320,000+ businesses worldwide, and processes 1,000,000,000+ requests daily. GeeTest has been trusted by clients from all sectors, especially e-commerce firms, like Nike, eBay, SHEIN, etc.

Since holiday shopping is coming, we want to help all online retailers, no matter their size, to prepare for the fight against fraudsters, and make the holiday season a real success.

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