Cyber 5 fraud decreased year over year, according to data from a sample set of nearly a thousand online retailers in the United States.
The data, from fraud management and chargeback protection services vendor ClearSale, found a decrease in attempted fraud between Black Friday and Cyber Monday. Notably, whereas ClearSale data showed attempts at fraud (or fraud avoided) decreased 37% year over year, order volume and order value also fell among the same group of online retailers.
Bruno Farinelli, senior director of risk at ClearSale, said there are a couple feasible possibilities for the decreases in order volume this year. The first is that many online retailers started their Cyber 5 sales and promotions weeks—and in some cases months—before the actual Black Friday weekend.
“This could have spread out the order volume that would normally happen in one weekend to a broader number of days,” Farinelli said. “The other very reasonable assumption that we could make is that the economic slowdown and the interest rate hikes in the U.S. and across the globe have seen shoppers more cautious in their spending and more frugal with their wallets during seasonal shopping.”
ClearSale’s network includes more than 35 online retailers in the Top 1000, including eight that rank among the largest 100 retailers. The Top 1000 is Digital Commerce 360’s database ranking the largest ecommerce retailers in North America based on their web sales. ClearSale ranks third in the Payment Security and Fraud Prevention category in Digital Commerce 360’s new report, 2024 Leading Vendors to the Top 1000 Retailers.
Fraud decreases from Black Friday to Cyber Monday
ClearSale found that from Black Friday to Cyber Monday, order volume decreased 41% year over year. Order amount decreased, too, down 27% year over year.
The percentage of fraud attempts in relation to total orders also decreased slightly, according to information shared by ClearSale. It decreased to 1.5% of orders being fraud attempts during the Cyber 5 in 2023, from 1.75% last year.
“While fraud is extremely dynamic, economic pressure is one of the drivers behind it, which is why we are seeing a general increase over the last couple of years of attempted fraud in ecommerce,” Farinelli said.
As a rule of thumb, he said, an increase in order volume and value means an increase in fraud, and vice versa. This year’s data followed this formula, he said, but the overall rates of fraud are increasing.
Watches and glasses led as the categories with the highest percentage of fraud attempts during the 2023 Cyber 5, according to ClearSale. 12.83% of orders in the category were subjected to fraud attempts. The next-largest category was computers, at 4.84%. That’s about a third of the rate of the watches/glasses category.
The top categories of fraud attempts in 2023:
- Watches/glasses: 12.83%
- Computers: 4.84%
- Phones/Electronics: 4.47%
- Digital: 4.44%
- Jewelry: 2.71%
Three of those categories were also in the top five last year, according to ClearSale data. However, none of the categories ClearSale tracked in 2022 reached 10% of its orders being fraudulent.
The top categories of fraud attempts in 2022:
- Accessories: 7%
- Computers: 5.49%
- Jewelry: 4.56%
- Phones/Electronics: 4.52%
- Luxury apparel (over $200 ticket value): 3.14%
The computers, jewelry, and phones/electronics categories all remained in the top five this year. However, the rates of fraud for each decreased year over year, with the jewelry category’s fraud decreasing the most.
Data consistency
The decrease in fraud during the Cyber 5 is consistent with data from Signifyd, another cybersecurity vendor. Signifyd’s network includes 115 retailers in the Top 1000. It found that fraud attempts during the Cyber 5 decreased 20% year over year.
J. Bennett, chief customer officer at Signifyd, said that’s because last year, there was a big and sophisticated wave of fraud attempts engineered by a crime ring in Southeast Asia, and that has not been repeated this year.
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