eCommerce is the Future and Now
Before we get started into what causes eCommerce scams or what problems affect everyone, it’s good to know what it means. Overall eCommerce encompasses a large area of the internet. It’s those sales online, profits and ultimately it just means transactions made over the internet.
It’s constantly growing and as more people buy online there is a growing risk of scams. What’s interesting is that these scams are being performed by fake eCommerce companies just as much as the people buying the merchandise. Both consumers and businesses are getting scammed and here’s why.
Selling Online Isn’t Always Easy
Yes, we love shopping online. In fact, we love it so much that eCommerce is expected to hit 4.5 trillion by 2021! But with all that growth also comes the downside of it all. eCommerce hurts brick and mortar stores and the added cost of shipping chips away at profits.
While it’s easy to be the consumer in this case, businesses have to shell out more for shipping (read more about shipping statistics here). Shipping is also part of the problem to the scams that are growing in this industry.
When an item ships you expect to receive it after a few days. Likewise, when items are returned companies expect to receive those as well. But here’s where things get a bit shady for some companies and people.
Shipping and Returning Items are Great for Scams
Most of us have heard about credit card scams and how to avoid those. But as a consumer have you heard about buying items online to never receive them? Amazon and other companies have had sellers that pretend to be selling an item, except the buyer never receives anything. And I’m not talking about porch pirates either…
When you purchase an item online there is a chance that the anonymous seller is just trying to scam you. This is especially true if you pay directly with your bank or credit card. Scams like this are efficient because it can be very difficult to track down the scammer in some cases.
Scammers are nifty and that’s why when you’re the consumer it’s important to only buy from sources you trust. Here are some ways to be safer…
- Buy from trusted websites online (Amazon, Ebay, Mercari, etc.).
- Read reviews about sellers and their ratings.
- Don’t make purchases using your actual card. Rely on PayPal or other safer paying methods.
Some of those methods can help keep your purchases online safer. But let’s say you’re the seller online, there’s a tricky set of scams against you too!
eCommerce Scams Hurt Sellers
Now that we’ve covered some of the ways that online sellers can scam consumers, it’s time for the sellers. Buyers can actually scam your online business if you aren’t careful. There’s a particularly fast growing kind of scam that buyers are using.
It’s the scam called “my box arrived empty”. Well it’s not really called that but you get the idea! A buyer will purchase an item and say that it arrived empty. This won’t really work with smaller sellers but large companies like Amazon or Ebay have ran into this scam. There isn’t much choice but to refund the buyer or send another item out to them.
While this scam might not hurt companies like Amazon that much, it can hurt sellers if it’s ever allowed. But this scam is much more uncommon to affect smaller sellers unlike the next scams below!
The Box Switcheroo Scam
This type of scam does affect smaller sellers a lot. It goes like this. A buyer will purchase a similar or identical item to the one they currently own. Next they will keep the new item and return their old item in the same box. This method works with shoes or some electronics. They might have worn out shoes of the same brand and style but still love using them. That’s why it hurts sellers to have an old item returned.
It’s not even about a product being defective or broken, it’s downright switched with a completely different item. The advantage of receiving a defective item return is that a seller can sometimes refurbish it to sell it at a discount.
I’ve seen this method used with shoes, headphones, game controllers and a variety of other items. The problem is that it’s very difficult to prove that someone returned their old item. Companies like Ebay have dealt with this situation by refunding the seller in the past, but some people aren’t as lucky.
Sadly, you can find a lot of unfortunate sellers who have had this issue. Sometimes the buyer doesn’t return all of the item or it’s missing parts. It’s a scam, and one that isn’t always easy to catch.
Return Policies, Liquidations and Other Customer Problems
I know I’m focusing more on the seller side but that’s the side that many people don’t really know about. We all for the most part have heard about staying safe with our banking information. But when it comes to the sellers it’s a hard business with eCommerce scams.
Return policies typically allow a customer to return items even in very poor condition. This creates a problem for liquidators, who deal with customer returns. Suddenly customer returns can arrive in salvage condition. People in general like to return things even if they are the ones that broke it. This isn’t always the case, but in many situations it is.
A return policy that isn’t reinforced or checked means liquidators may purchase incomplete returns. An item that is missing parts isn’t worth a whole lot. I won’t go into too many details about liquidations but I’ll put a link in here for you to get an idea on what it’s about. Basically, a single scam can trickle down the process line.
eCommerce Scams Leave a Trail of Damage
Whether you’re a consumer or a business online, eCommerce scams are bad. When a small business gets hit it could affect how much you, as a consumer will have to pay for items. Likewise, scams could cause new startups to quickly fall under and shut down before they even get a chance.
What do you think companies should do to reduce these scams? Have you ever been a victim of a scam like this as a consumer or a business? Let us know below!
Originally published at https://techvirtuosity.com on February 23, 2020.