For many online sellers, encountering bogus buyers is almost a certainty, such that it becomes a question of “when” and not “if.”
The best thing that sellers can do is prepare, and hopefully minimize the damage that a bogus buyer may cause. Scams do happen and they can happen on both sides: there are fraud sellers and there are bogus and/or fraud buyers.
The use of WooCommerce as a preferred platform for online selling has risen exponentially over the years. This means, sooner or later, a WooCommerce online store will inevitably encounter bogus buyers.
For many sellers, bogus buyers often waste the time and resources of online businesses. In the online business world—and the more traditional brick-and-mortar shops—time is indeed, money.
Speaking of money, bogus buyers significantly contribute to the losses of online sellers. In fact, a recent industry report indicated that online sellers’ losses to online payment frauds are likely to reach more than $206 billion between 2021 to 2025. Out of this huge amount, more than 45 percent are losses due to unpaid purchases.
What is alarming is that according to this same research, the COVID-19 pandemic has led to a surge in fake identity and account takeover fraud, which can potentially endanger the security of the entire online business ecosystem.
Speaking of the whole online business ecosystem, it is said that almost 60 percent of the world’s population now have internet access. More people will be on the web soon, driven by the convenience of online shopping. As a result, global retail e-commerce sales reached almost $5 trillion in 2021. However, global fraud is also on the rise and is seen to cst online business almost $50 billion in a few years.
Fortunately, there are many measures in place that can mitigate the effects of bogus buyers. Depending on the country, there might be regulations or laws that can protect businesses, including small or starting online sellers.
As a WooCommerce online seller, you have some options or best practices that will hopefully equip you to handle bogus buyers. In this piece, we will look into ways that WooCommerce sellers avoid these bogus buyers.
Knowing the bogus buyer
First, let’s take a quick look at what a typical bogus buyer is. Industry insiders often describe a bogus buyer as a person or a customer—or sometimes even a business entity—who buys or orders something online with no intention of actually paying for the said item. Simply put, a bogus buyer’s intent is to “fool” or even scam online sellers.
There are also many ways that a bogus buyer operates. Aside from the aforementioned fake buyer, a bogus buyer may also make false claims: for example, he or she may claim that the delivered item is damaged, thus, refusing to pay.
Over the last few years, a new nefarious breed of bogus buyers has become noticeable. These so-called “joy reservers” often make reservations on a particular item, only to abandon the said item and not pay for it. “Joy reserver” is now considered an online business jargon.
Many might consider “joy reservers” as annoying and fairly harmless. However, the lost time and opportunity are valuable, particularly for the seller. So here’s the scenario: You have a hot item on your product list and a particular buyer shows enthusiasm and often make positive reviews on the said item. The joy reserver then “reserves” the item, thus depriving other buyers from buying the item outright. From a sales standpoint, the online seller bears the losses if the scenario happens multiple times.
Identity theft is also a recurring concern that WooCOmmerce sellers face. Often, bogus buyers use fake or stolen identities to order. The “fake” delivery scam happens when information such as addresses, mobile numbers, names, etc. are wrongfully used.
Mass media coverages of delivery riders delivering in wrong addresses, wrong names, or deliveries that were not actually ordered by the person (whose identity was used) have become too common.
There are also a lot of videos shared on social media showing delivery riders holding huge orders, only to be left hanging and confused. In the Philippines, these scenarios have become so bad that the government had to step in and implement stricter rules on cash on delivery items.
How to Avoid Bogus Buyers on WooCommerce
As a WooCommerce seller, there are a few tips and tricks that you can do to handle the bogus buyer.
As mentioned, joy reservers are often more than a nuisance for a lot of online sellers. One of the ways to counter joy reservers is to set a strict reservation period. A reservation period may discourage the joy reseller from “holding on” to the item for a long period of time. Hopefully, a shorter reservation period will also mean the interests of other buyers will not dim, and thus will still be inclined to buy the sought-after item.
Experts say a one-week reservation period is ideal, although depending on the platform your using, you can even shorten this window.
Another way to deal with joy reservers is do some background checks. Joy reservers will usually jump from platform to platform, and will have—in some way—a digital footprint. Knowing the joy reserver will make it easier for you to make the adjustments. However, a word of caution: you cannot name and shame somebody, because he or she is a joy reserver. As an online seller on WooCommerce, you need to be wary of privacy rules.
Bogus buyers are also very fond of fake orders. And when we speak of fake orders, these are prank orders targeting online sellers. Perhaps due to the ease at which online ordering and selling, many individuals seem to find some joy in doing pranks out of mischief.
There are many, many anecdotes of prank orders, and although they may be fun for others, the online seller is left taking care of the logistics nightmare. And again, lost time means lost money or sales.
Bogus buyers often use cash on delivery or COD as a method of payment, although they do not really have any intentions of paying. The same pattern here emerges: The shipping, packaging, and delivery of items—which will eventually not going be paid—can take an enormous toll on you, as a seller.
One way of dealing with this is asking for a downpayment, although this is not a very common practice. Other WooCommerce sellers might use online payments only, particularly for pricey items, or orders made in bulk.
Another way is a more thorough background check on customers. Although this might be tedious, you can check all the customer details, particularly if the customer is new to your store.
You can also spend a bit of time looking for suspicious email addresses. A rule of thumb here is that email addresses with a lot of random numbers may raise a red flag. In most cases, fraudsters use temporary or bogus email accounts to place fake orders.
More ways to discourage the bogus buyer on WooCommerce
After spending time checking and double-checking customer information, another way for you to check if a buyer is bogus is to take a closer look at the orders made.
It might be almost impossible to stop fake orders, but there are ways to detect, and hopefully prevent fake orders from happening on WooCommerce store. The keyword here is detection: If you can detect a fake order, then you can stop the fraudulent transaction from happening. But how do you do this?
Large orders are always welcome, particularly if you are just starting your online business. However, large orders can also be huge red flags that you might want to watch out for.
As a WooCommerce store, you might already have a grasp of the usual volume that your usual customers make. These are very rough estimates, but if you plot the orders on a graph, you’ll likely to see fairly regular ebbs and flows. Spikes are usually seen when there is a sale season.
And yes, you might also have a handful of customers that are usually buying in bulk. However, if a new, unknown customer suddenly tries to make a significant order in your store, then you might need to double-check.
Industry insiders say this is where strict verification protocols can be used. You will be able to improve the security of your WooCommerce store by enabling strict verification steps such as passwords to access product pages. Information such as subscribers, previous shoppers, or registered users are very useful since you can review your customers’ actions in your store.
Go hi-tech and use WooCommerce tools
Fortunately, WooCommerce has tools that you can use against the bogus buyer. Some of these tools are plug-ins that were designed to specifically prevent fraud. You might need to spend a bit of time integrating the plug-ins to your WooCommerce store, but the effort will surely be worth it.
You may also need to pay a subscription fee to use these tools. Third-party developers have WooCommerce anti-fraud extensions which promise to combat fraudulent transactions and catch them as they happen.
The tool can automate processes including blocking or pausing fraudulent orders, including blocking orders from high-risk domains and unsafe countries. These anti-fraud extensions will also allow you to view risks and warnings, associated with orders, and eventually change order status based on risks.
These automated processes can be considered very technical but are necessary. Also, they give you the options to customize your security protection, including; confirming legitimate orders for purchases made from PayPal by sending a notification to the PayPal user; email checking with high-risk domains; and setting a “limiter” on order purchases.
You can even disable COD payment options to filter customers who have been identified as placing fraud orders. Further, you can also approve or reject new users who place orders at your store, particularly if these customers have been flagged.
How about placing a reward system for online payments? To avoid a potential logistics mess resulting from an unpaid COD item, perhaps you can offer special discounts or rewards to customers to buy items using online payments. It is a known fact that most bogus buyers make fake orders by using COD, but an online payment option might discourage the bogus buyer.
Your WooCommerce store can have many features to allow your potential customers to have a great buying experience. However, having many online features may be a disadvantage, as bogus buyers might be able to exploit your product pages. One way to prevent this is using passwords to protect product pages.
Under the WooCOmmerce anti-fraud extensions are so-called “blockers.” Developed by third-party companies, these extensions or tools prevent fake orders from happening and “blocks” bogus buyers. The blocker tool helps you to identify and block orders from specific IP addresses, countries, zip codes. The tool even creates a blacklist and automatically adds the blocked information. The good thing about blockers is that the bogus buyer can be stopped, even during the checkout process in your store.
Using multiple anti-fraud extensions in your WooCommerce store may be daunting, and you might eventually need a specialist or expert to assist you when it comes to the anti-fraud applications, However, you can consider this a sound investment in the long run, especially because bogus buyers also tend to be very technology-savvy.
Lastly, you can also implement multiple verbal, mobile, online confirmation methods just to make sure that you confirm with the buyer that an order has been placed.
In conclusion, there might not be a 100-percent, foolproof system to prevent bogus buyers from entering your WooCommerce online store. However, tightening up your security and using tools, and using industry best practices will allow you to lessen the blow that these bogus buyers might bring.