A recent report by Clutch found that a majority of online shoppers run into scams, with many of them even falling for these scams. The report also covered who consumers feel is responsible for the scams, where the scams are most common, and more.
A Large Majority of Online Shoppers Encounter Scams
According to the report by Clutch, which was based on a survey of consumers, 71% of respondents said they encountered a scam or attempted scam while shopping online. In addition to simply encountering a scam online, many consumers also fall for them.
For example, 56% of respondents said they’ve been scammed while shopping online, and among those who have been scammed, 42% say that it happened over the last year.
While all generations are familiar with ecommerce scams, younger generations have more familiarity and awareness, and thus may be less likely to fall victim to these scams. According to the report, 95% of millennials are familiar with ecommerce scams, compared to 92% of Gen Z, 86% of Gen X, and 82% of Baby Boomers.
Due to this relatively high awareness of the existence of online scams, 92% of online shoppers are concerned about the influence that these scams may have on the purchases they make online. Many shoppers are always on guard and rely on instinct and skepticism to keep themselves safe from the growing risk of online scams.
For example, 62% avoid deals that seem too good to be true in an effort to avoid potential scams. Many people are also growing more aware of other potential red flags of scams, such as time-sensitive discounts, misspelled brand websites or stores, and ads that show off luxury goods at incredibly low prices.
Ecommerce brands also need to keep in mind that ecommerce fraud and scams aren’t limited to consumers. Many companies find themselves dealing with issues like chargeback fraud, promo abuse, synthetic identity fraud, and many others. Advancements in technology, such as AI, are also accelerating these types of digital fraud, so companies need to be careful.
Who Has The Responsibility of Preventing Scams?
In terms of accountability, 61% of consumers say that the online platforms have the most responsibility for preventing ecommerce scams. This includes social media networks, marketplaces, and search engines.
These are the destinations that often host the listings and ads that directly scam people, so consumers expect these platforms to identify and remove scammers and fraudsters before they have a chance to reach the customer.
Specifically, fake ads impersonating major and well-known brands are common, as 58% of consumers say they have seen these types of scams. Even though the actual brand itself isn’t involved at all and is also a victim of the scam, 54% of consumers say their trust in a brand decreases after seeing a scam involving the brand.
So even if a company had nothing to do with the scam or fake ad, its credibility may suffer simply by being associated with the fraud.
The report also found that 67% of respondents believe brands can help protect potential customers from falling victim to these scams by actively monitoring for (and removing) fake ads.
In addition to actively monitoring and removing these fake ads, other ways that companies can better protect customers from scams include:
- Educating customers about common scam tactics, so they know what to look for.
- Share and verify the emails or support channels they respond from, so consumers can easily check whether an email or phone number that’s reaching out to them is actually from the company or not.
- Post the types of things they’ll ask for, and never ask for, when communicating with customers.
- Respond quickly to customer requests or concerns about any fraudulent activity or scams.
Social Media is Where the Most Scams Are
While these ecommerce scams can appear just about anywhere online, they seem to be the most common on social media. A third of consumers (33%) have recently encountered a suspected scam on social media, compared to email (18%), online marketplaces (16%), or unfamiliar online storefronts (11%).
This isn’t surprising, as social media feeds move incredibly quickly and are full of ads. While many of them are legitimate, it’s often hard to tell the difference between a legitimate ad and a scam, unless you’re being very careful and checking profiles or looking for a verified badge.
As the results of this survey show, online scams are a major issue not only for consumers, but also for platforms and ecommerce brands, too. While eliminating these scams entirely may not be possible, companies need to do all they can to reduce them. If not, their brand credibility may suffer from something that’s entirely out of their control.
