In actuality, fraud prevention is critical to growing revenue and maintaining any business' bottom line. That’s why it's important for fraud and security teams to “get a seat at the table”. Just as much as finance, operations, or any other department, your teams should be able to explain how your work is crucial to the business. Below are some steps to take to do just that.
Money talks on fraud
First and foremost, preventing fraud improves the bottom line. Having good fraud prevention in place reduces chargebacks, protects customer accounts, and safeguards the integrity of your business or platform. Doing so while maintaining a good user experience also leads to more engaged, loyal, and profitable customers.
It's important to take data and relay it to show how fraud prevention benefits the bottom line. Too often, fraud is discussed in terms of the potential money saved. It should also be quantified in terms of revenue generated, such as by facilitating a better customer experience. A fraud manager needs to take a more strategic approach and be able to communicate in business terms why their role is important. They also need to relate to why their departments are critical to the ongoing success of the enterprise.
So, that means quantifying how stopping bonus abuse means that the business will be able to better reward real customers with promotions. Or that keeping a customer's account safe and facilitating a digital environment free from abusive behavior ultimately leads to happier customers that spend more time and money on your site.
The work of fraud departments can be further quantified even beyond pure dollar terms. For example, if customer accounts are compromised, what’s the brand impact if they take to social media to complain? And if it happens at scale, there could be negative PR consequences and brand value implications as well.
Most of the time, people in fraud talk about metrics in qualitative terms that lack context into how it fits into the overall business. When it comes to asking the board or the C-suite for budget increases, fraud managers need to be able to articulate the ROI on these investments.
Measure, measure measure
Doing this successfully means having strong reporting and tracking protocols in place. Fraud teams should be able to deliver concrete metrics to executive leadership. This can include not only the “hard cost” of fraud but also the ancillary benefits of having good fraud prevention in place. These benefits include brand integrity, loyal customers, and avoiding negative headlines.
This is data that already exists, but fraud teams need to define it in a digestible manner for company leadership to understand. It’s easy to track money lost to fraud, but fraud managers need to analyze the data to determine figures such as how a reduction in false positives directly ties to increased revenues.
Such data can also be effectively used for sales and marketing purposes, for example, to reassure customers and potential customers that your digital platform is safe and secure. This is just another way to show the positive business effects of robust security and fraud prevention.
Fraud teams often struggle to get a voice in the wider business ecosystem. Executives generally only tend to notice if something goes wrong; like an offensive lineman on a football field, they are considered to be doing a good job if their name never gets mentioned.
But fraud and security departments can and should be more proactive in presenting how the work they do drives revenue and business growth. By using the right data and concrete metrics, they can do just that.
About Arkose Labs
Arkose Labs’ zero tolerance to fraud approach provides businesses with a fraud prevention strategy that looks beyond data-driven online fraud mitigation intelligence. Read more about how Arkose Labs disrupts the economic drivers of fraud and eliminates the financial incentive of cybercriminals by requesting this Whitepaper.