We’re publishing a new Skift Trends Report in partnership with Riskified: Solving Travel’s Revenue-Limiting E-Commerce Fraud Problem, that takes a closer look at the hidden costs of travel e-commerce and provide strategy on how to address it. Digital purchases make up a critical and growing share of travel industry revenue.
According to one recent estimate, worldwide digital travel sales will surpass $676 billion in 2018. But despite these optimistic e-commerce forecasts, all is not well.
In fact, a growing problem threatens to destroy the industry’s hard-won digital gains: e-commerce fraud. One recent estimate of the airline industry found that e-commerce fraud cost the sector nearly $900 million a year, with roughly 75 percent of those costs borne by the airlines themselves.
In the OTA sector it’s even higher: another forecast predicted OTA fraud would grow by 24 percent between 2017 and 2020, costing more than $10.9 billion worldwide by 2020. However, the strategies used by most travel businesses to fight fraudulent transactions actually make the problem worse, not better.
Many travel businesses rely on outdated, rigid, labor-intensive fraud prevention protocols that are leading to a growing number of “false declines,” legitimate purchases that are wrongly rejected due to suspected fraud. The result of these inefficient fraud-detection safeguards is a problem that is much costlier than fraud itself. Read more from skift.com…
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