August 8th, 2014 by Elma Jane
Visa Inc., the global leader in payments, is helping U.S. fuel retailers prevent credit and debit card fraud at the pump with intelligent analytics that identify higher-risk transactions that may be fraudulent. Visa Transaction Advisor uses sophisticated analytics based on the breadth and scale of VisaNet data to flag the riskiest transactions by working with fuel companies to understand their needs, creating a new service that builds on Visa’s predictive analytics capabilities, providing fuel merchants with more intelligence to prevent fraud and improve their bottom line. While global fraud rates across the Visa payment system remain near historic lows, less than 6 cents for every $100 transacted – fuel pumps can be targets for criminals because they are often self-service terminals. The new solution, Visa Transaction Advisor (VTA), enables merchants to use real-time authorization risk scores to identify transactions that could involve lost, stolen or counterfeit cards. A pilot test of the new service showed a 23 percent reduction in the rate of fraudulent transactions – all without costly infrastructure upgrades or disruption of the customer experience.
How It Works
After a cardholder inserts the card at the pump, Visa analyzes multiple data sets such as past transactions, whether the account has been involved in a data compromise and nearly 500 other pieces of data to create a risk score. This allows merchants to identify those transactions with a higher risk of fraud and perform further cardholder authentication before gas is pumped. The time and costs associated with resolving fraudulent transactions can be substantial for both merchants and financial institutions and inconvenient for cardholders, which is one of the reasons why fraud prevention is critical. Visa’s solution is easy to implement, using existing message fields and formats as well as pump software or hardware to ensure minimal impact to merchants and acquirers. Several fuel merchants who piloted the technology over the last several months noticed a decrease in fraud, without negatively impacting their consumers’ experience. VTA as a tool help mitigate fraudulent transactions. A 23 percent reduction in the rate of fraudulent chargebacks during a pilot program in Los Angeles. This was done with minimal impact to the customer experience, making secure payment at the pump as convenient as possible. Providing fuel to millions of customers each month through approximately 15,000 service stations in the United States, said US Credit Card Operations Manager, from Shell, considering new solutions and technology it has to have a clear business benefit, be customer-centric and easy to implement. With no infrastructure investment, testing VTA as part of proactive fraud prevention tool-set to better identify fraudulent card activity earlier in the transaction cycle, without inconveniencing customers.
Visa Transaction Advisor is available to merchants through participating U.S. acquirers. Visa has partnered with Vantiv and is also working with other acquirers to offer the service to its fuel clients. Ease of implementation is a critical requirement whenever talking about a new merchant service. Visa Transaction Advisor builds on existing payment infrastructure, is easy to implement and flexible enough to allow customization by merchants.
Posted in Credit Card Security, EMV EuroPay MasterCard Visa, Visa MasterCard American Express Tagged with: account, acquirers, analytics, authorization, card, cardholder, counterfeit cards, credit, Credit Card Operations, customer, data, debit, financial institutions, fraud, higher-risk transactions, Merchant's, payments, Rates, retailers, terminals, transactions, visa, Visa payment, Visa Transaction, Visa Transaction Advisor, VisaNet, VTA
June 19th, 2014 by Elma Jane
Analytics versus Intuition:
Human behavior plays a big role in sales forecasting. We have a number to shoot for, and often we try to figure out ways to make it, regardless of the soundness of our reasoning. So we assume deals are going to close even if it means we have to ignore telltale signs of trouble until its too late. Using modeling and analytics to evaluate your company’s position in each deal. The model could tell you the warning signs, because analytics would reveal how closely any deal fit with the model’s known history of success. As with weather forecasting, there would be no value judgement, just a probability of rain. Managers would still need to apply their reasoning, but armed with this kind of knowledge, sales people up and down the organization could evaluate scenarios constructed to make their deals match up with the ideal.
Cloudy With 30 Percent Chance Of Sale
Take a more scientific approach. The sales process stage is one of the variables in the model that the company uses to evaluate deals. More importantly, the busisness applies analytics to the deal data rather than expecting managers to review all of it. Analytics would have no trouble spotting the incomplete deal stage and would downgrade the forecast appropriately. A report then would show the variance between the forecast and the model. If you apply this logic to every deal in the forecast, then you have a range of probabilities similar to those weather people rely on to tell you about Saturday’s conditions. More importantly and unlike a weather report, the forecast is also prescriptive because it shows you how you can improve it. Get that meeting with the decision maker if you want to close the deal. Everyone complains about the weather but no one does anything about it. If you’re tired of complaints about sales forecast accuracy, consider building an accurate model and applying analytics. It works for the weather.
Posted in Best Practices for Merchants Tagged with: analytics, data, deals, sales
February 18th, 2014 by Elma Jane
For Ecommerce Testing, Clarify Conversion Goals
Before you can start any testing on your ecommerce site, you need to clarify your goals. Setting the right goals is the first step to making any improvements. There’s a saying, “Whatever you measure grows.” So, make sure you measure the right thing.
Goals may seem like the obvious part. After all, you already know you want more sales, right? But there’s more to goal setting than just deciding to try and increase your sales.
The Goals Waterfall
Your goals for your conversion-optimization tests should flow from your marketing goals, which ultimately flow from the organization’s overall goals and strategy.
Business Goals – Marketing Goals – Conversation Optimization Goals.
The goals from optimization testing should follow from a company’s overall goals and strategy
Your business goals should determine your website goals, which should be prioritized to determine your leading conversion optimization goal.
The conversion optimization goal for any test should be selected based on how well it supports the website’s goals. This is often an area where there’s confusion about what are the priority metrics to improve. Don’t get off track by following website goals that don’t support marketing goals.
Prioritize Goals
Most sites will have several key goals, so you’ll need to prioritize them. You can do this in three steps.
Rank your goals in terms of their relative value to your business:
Assigning values to goals. The values don’t have to be absolutely accurate revenue-producing numbers to begin. Pick a median goal on your list, and assign it an arbitrary amount, and then estimate the relative value of goals above and below it.
Estimating actual goal values. Now, to get even better results, you can refine these relative numbers with whatever hard data you have, such as average order value, lifetime value of a customer, or the close rate and value your sales team sees when following up on quote requests. Don’t worry about 100 percent accuracy. It’s better to start testing with relatively firm numbers than to delay until everything’s perfect.
Priority Goal
1 Product Sale
2 Quote Request
3 Whitepaper Download
4 Blog Comment
5 Social-Media Profile Activity
Tracking Your Goals
Once you’ve identified your most important conversion goal for your experiment, make sure you track it. Goals are a crucial part of your web analytics setup. If you don’t have keys goals in place, you’re missing out on half the value of your various reports.
That means translating your testing goal into a technical goal trigger that will be tracked by the analytics and testing tools you’re using. The goal you track must be represented by a specific action the visitor takes on the website, like a button click or a visit to a page. Think about an action on the site that the visitors will do only once they have completed the goal.
The key is that it should be an action as close to revenue as possible. So, if your goal is to sell a product, you should track a post-sale thank you page as the goal trigger. (If you also accept phone orders, you may need to tackle some advanced tracking techniques to get reliable test results.)
Goals with values attached to them, as explained above, are the only way to find your most valuable visitors, they’re crucial for effective conversion optimization testing.
Be sure to set up ecommerce revenue tracking as well. Increasing average order value can be just as effective as boosting your sales conversion rate, and you’ll want to be able to include that in your results analysis.
A Single Goal
Web analytics tools can provide a ton of information, and it’s not uncommon for e-commerce sites to have a handful of key performance indicators. Example, you may track time on page and the add-to-cart rate, but when it comes to conversion optimization A/B testing, it’s important to focus on only the revenue-producing goals or goals for each test. Always make sure you are tracking revenue for each test variation. Otherwise, you could pick a conversion rate winner that inadvertently sells lower-value products.
Track revenue-producing goals for your A/B tests, but those other goals are still useful too. While not all web analytics goals are the best for A/B testing, they still may be helpful to generate hypotheses and explore new testing opportunities.
By paying attention to secondary goals, you can discover new testing avenues that help you get even more value from your ecommerce website.
Track as many goals and actions as you can with your web analytics tools so you can be free to explore your visitors’ behavior. Within web analytics is where you can do freeform exploration to generate ideas or hypotheses for your A/B tests. Then, validate those ideas through revenue-tracking controlled tests.
Posted in Best Practices for Merchants, Credit card Processing, Small Business Improvement Tagged with: a/b testing, accuracy, advanced tracking techniques, analytics, business goals, conversion, conversion rate, conversion-optimization, e-commerce, ecommerce, goal trigger, goals, hard data, increase your sales, marketing goals, optimization, post-sale, prioritize, revenue, revenue-producing goals, sell a product, strategy, website
January 2nd, 2014 by Elma Jane
Online consumers generate an avalanche of data.Companies such as Amazon and Target have used Big Data for years. It’s the secret behind their highly personalized product recommendations and email promotions.
The good news is that smaller companies can use the power of Big Data in their businesses, too. But just because you can gather tons of data, doesn’t mean you should. For most small-to-midsize businesses, trying to harness Big Data can sometimes do more harm than good. It can slow down your website and cost time and money.
To make effective data-driven decisions in your business, control the types of information you collect. Focus only on the metrics that truly affect conversion rates and ignore the ones that don’t have much of an impact.
Tracking raw ad impressions regardless of whether they yield clicks or conversions is an example of monitoring low-impact data. The same thing goes for blindly monitoring Facebook Likes or Klout scores. Stop wasting resources on metrics like these. Devote your efforts on the data points that count.
Here are the most important ones for e-commerce merchants.
Number of Site Visitors and Where They’re Coming From
Online marketing is rarely cheap and quick. You have to determine the best strategies to spend resources on. There are several free and easy-to-use tools that can provide this information.
Google Analytics is an excellent tool that gives you insights on your traffic and traffic sources. To go deeper, such as which specific newsletter or which Facebook update sent visitors to your site, you can create Custom Campaigns and add special URL tags for each campaign. This lets you drill down on the specific source for your referral traffic.
Also, set up your online campaigns to make it easy to monitor. For example, having a different landing page for each guest post will allow you to quickly see which ones are sending traffic. Or, for social media, you can publish updates using a simple tool like Buffer so you monitor clicks each from each post.
Sales and Beyond
Tracking your sales is key. Aside from looking at your basic sales numbers, compute your average order value and compare it with your marketing and advertising budget. Viewing how much you’re spending on each customer versus how much they’re spending on you will help create the right budget for customer acquisition and retention.
Beyond gross sales, monitor item returns to obtain the net sales volume. Determine also the reasons behind refunds and exchanges to improve your merchandise.
Also, track sales from promotional offers, to know what promos or discounts to provide in the future. If, for example, you used a loss leader to attract customers into your store, closely monitor overall sales based on that offer to see if it generated profits.
Knowing this sales data will enable you to send out tailored promotions to users. And if you can combine those insights with other data such as the time they usually buy from you or what device they use you’ll be able to optimize your campaigns for maximum conversions.
What Visitors Are Doing on your Site
Tracking the pages that users viewed, the actions they took, and their exit points can give you tremendous insights about your site and your visitors. Analyzing these things will tell you which aspects of your site need improvement.
For example, say you discovered that while shoppers are clicking the “add to cart” button, most leave before they provide their credit card details. This could mean that there’s something wrong with your checkout page. Perhaps it’s confusing or you need a stronger guarantee. Regardless, you won’t be able to identify the problem if you don’t track what’s going on.
How you track user behavior will depend on what you want to measure. If you want to track your exit traffic, for example, to add outbound link-tracker code to your website. For WordPress sites, this can easily be done using the Ultimate Google Analytics plugin.
On the other hand, if you want to track how users react to specific site elements such as buttons, text size, forms, and other key elements use heat maps that give you a visual representation of user behavior. Crazy Egg offers a solution for this. It enables you to see how people are behaving on each page.
Posted in e-commerce & m-commerce, Electronic Payments, Internet Payment Gateway Tagged with: acquisition, Amazon, analytics, big data, campaigns, conversion, credit-card, data, data-driven, e-commerce, email, exchanges, Facebook, google, insights, online, personalized, refunds, resources, sales, target, wordpress
October 31st, 2013 by Elma Jane
While credit card processors and retailers have made strides to combat credit card fraud, it is still rampant across the U.S. In fact, credit card fraud jumped 17 percent between January, 2011, and September, 2012, according to the most recent data from the FICO Falcon Fraud Manager Consortium.
Debit cards obviously have better safeguard measures in place, since debit card fraud rose less than 1 percent between January, 2011, and September, 2012. Plus, the average fraud loss per compromised account fell by 3 percent.
Card-not-present (CNP) fraud is the biggest challenge by far, accounting for 47 percent of all credit card fraud. CNP fraud – which includes payments via the internet, mail and phone – grew 25 percent over the two-year period. So, where the problems with credit cards lie.
Unfortunately, CNP fraud may get worse before it gets better, in FICO’s Banking Analytics Blog. This problem may even intensify as the US moves away from magnetic stripe and toward EMV [chip] card technology. In other countries adopting chip-based authentication technology, we’ve seen counterfeit fraud decline, but as a counterbalance, fraudsters often ramp up efforts around CNP fraud.
However, there was a glimmer of light in the credit card fraud fiasco. While card fraud attempts rose, the average loss per compromised account dropped 10 percent. Plus, the ratio of fraud to non-fraud spending remained constant. “In other words, the volume of card fraud increased proportionally to the volume of consumer credit card spending.
Even though many retailers have implemented successful fraud prevention programs, Visa provides retailers with the warning signs for CNP fraud, including:
Multiple cards used from a single IP address. Orders made up of “big ticket” items. Orders that include several of the same item. Shipping to an international address. Transactions with similar account numbers.
Posted in Digital Wallet Privacy, EMV EuroPay MasterCard Visa, Mail Order Telephone Order, Payment Card Industry PCI Security Tagged with: account, analytics, authentication, banking, big ticket, card-not-present, chip card, chip-based, cnp, counterfeit, credit-card, debit cards, EMV, fraud, fraudsters, international, internet, magnetic stripe, mail, non-fraud, orders, payments, phone, prevent, processors, retailers, safeguard, spending, transactions, visa
