Merchants Face Quandary with Digital Goods: Balancing Fast Revenue vs. Fast Fraud

Vesta paper explores solutions for solving the digital goods catch-22

PORTLAND, OR — August 23, 2016 — Vesta Corporation, a global leader in the field of card-not-present (CNP) transactions, has released a new white paper, “A Merchant’s Guide to Successfully Selling Digital Goods.” The paper explores how merchants can successfully navigate operational risks and position their business to capitalize on the revenue opportunities of the digital world.

Digital goods and services—including eBooks, digital music streaming, digital gift cards, eTickets, online gaming, and subscription services—have grown exponentially with consumers’ heightened expectations for immediate gratification. In fact, 97 percent of the top U.S. retailers and restaurants now sell online gift cards. Vesta’s experts explain in the paper that adding digital goods requires an operational infrastructure that can process real-time transactions while concurrently managing the higher fraud risk created by instant fulfillment.

“Fighting digital goods fraud, or what we call ‘fast fraud,’ requires a sophisticated team of experts and real-time advanced analytics,” explains Vesta’s Chief Marketing Officer, Tom Byrnes. “And since most physical goods merchants’ current payments and fraud systems are focused on supporting physical products, they are incapable of combating the fraud risk accompanying digital goods.”

According to a Javelin study, retailers struggled to address that fraud risk to the tune of $32 billion in 2015 — more than double the 2014 ecommerce fraud rate. That rate is only expected to rise as the introduction of the EMV chip card standard constricts the supply of counterfeit cards, inciting fraud rings to deploy new tactics that target online CNP transactions. The white paper explores the following topics in detail:

  • The shift in purchasing behavior driving merchants to offer digital goods;
  • The risks and opportunities associated with digital goods;
  • Finding balance between risk and delivering a frictionless customer experience;
  • Advice for making the move from physical to digital goods.

“This paper is a must read for any retailer expanding its digital goods offerings or any merchant looking to add digital products to its lineup,” continues Byrnes. “It’s a shift that has to be carefully plotted in order to deliver on the revenue opportunity while balancing the risk inherent in instant fulfillment.”

Visit this website to download a complimentary copy of Vesta’s new white paper, “A Merchant’s Guide to Successfully Selling Digital Goods.”

About Vesta Corporation:
Vesta Corporation is the global leader of revenue-generating payment solutions for enterprise partners in the telecommunications, digital goods, media, and financial sectors. The company’s patented fraud protection technology is proven to increase conversion and acceptance while eliminating fraudulent transactions and merchant liability. Vesta has been recognized as a leading innovator in payments technologies, holds multiple patents, and has won numerous awards as one of America’s fastest growing companies. Founded in 1995 and headquartered in Portland, OR, Vesta’s operations span the Americas, Europe and Asia.

Press Contact:
Ian Toner
Communications Strategy Group, on behalf of Vesta Corporation