Chapter 8

5 Best Practices for
Preventing Ecommerce Fraud

Ecommerce fraud can be prevented. ClearSale has numerous success stories pointing to how effective a fraud prevention and protection strategy can be.

Here are some best practices:

  • Understand Which Segments Are Higher Risks
  • Compare Risk and Revenue
  • Get Personal With Customers
  • Beware of Automatic Filters
  • Partner With a Trusted Fraud Protection Solution Provider

Understand Which Segments Are Higher Risk

For luxury goods ecommerce businesses who are looking for ways to prevent fraud, the best starting place is to know which segments are higher risk. For example, jewelry and apparel are both considered high risk and should be subject to more scrutiny.


Category Risk Group
Alcohol & Pharmaceutical Drugs High
Digital Goods High
Games High
Home Appliances High
Jewelry High
Phones & Electronics High
Watches / Glasses High
Hardware / Home Improvement Medium
Fashion Accessories Medium
Apparel - Ticket Above $200 Medium
Automotive Parts/Accessories Medium
Mass Merchant - General business selling in multiple categories Medium
Musical Instrumental Medium
Shoes Medium
Sporting Goods Medium
Tactical Gear Medium
Toys & Hobbies Medium
Travel & Tourism Medium
Apparel - Ticket Below $200 Low
Books / Music / Video Low
Children & Baby Products Low
Flowers / Gifts Low
Health / Beauty Low
Pet Shops Low

Compare Risk & Revenue

Luxury ecommerce retailers should also review their current transaction approval rates to get a clear picture of how well they’re balancing risk with revenue.

Get Personal With Customers

Luxury consumers are more likely to travel, have multiple homes, and vacation for longer periods of time.

They also expect and are accustomed to over-the-top service, so contacting them directly to confirm addresses to protect them from fraud will most likely be a well-received communication.

A friendly confirmation check-in can be combined with a customer satisfaction inquiry to create even more affinity for a brand.

Be Wary of Automatic Filters

Ecommerce platforms have the best intentions to keep an online merchant protected from fraud, but blindly turning on filters as if every customer and every transaction is the same is a recipe for false declines. 

Be very cautious of automatic filters, especially when applying multiple filters, as they can either cancel each other out or double up to the point of declining good orders.

In general, luxury goods transactions should have some level of manual review for any flagged orders.

Partner With a Trusted Fraud Protection Solution Provider

The most effective way to prevent fraud is to work with an expert partner that has the expertise and experience to identify, evaluate, and prevent fraud from happening. For luxury goods merchants, that partner should have a global view of fraud and understand the most current tactics used by fraudsters.




Chapter 9

How We Help Luxury
Ecommerce Businesses Thrive