Despite the fact that making big-ticket purchases is easier than ever thanks to one-click eCommerce retailers, studies show that Millenials would rather spend their money on ticketed experiences than save up to purchase material items. Additionally, they’re willing to spend up to two-thirds moreon these experiences than their previous generation counterparts. Is it any mystery that cybercriminals are now targeting events and shows for ticket fraud?
Fraudsters go where the money is, and new trends show that event ticketing fraud is an emerging profit center for them. It’s particularly alarming for smaller, independent event organizers and ticket retailers with already tight margins that can’t afford the havoc wrought by fraudsters.
Event organizers and ticketers are experiencing a new surge in both customer demand from younger audiences purchasing more expensive tickets and VIP packages, as well as from fraudsters looking for loopholes in their systems. Enterprise ticket retailers may be prepared for this surge, as they’ve always had fraud teams in place to deal with chargebacks and stolen tickets. However, smaller independent organizers and ticket retailers may not understand or be prepared for the imminent threat that ticket fraud poses to their bottom line. In fact, when surveyed 48% of small and medium-sized business owners thought their companies were too small to be targeted by fraudsters. However, nothing could be further from the truth as studies show that Millenials actually prefer to patronize small and mid-sized businesses with events being no exception.
At particular risk are independent festivals, local theaters, and VIP experiences. Especially those that offer print-at-home or mobile ticketing because the barcodes are easy to replicate by printing multiple copies of a ticket or with a simple screenshot.
Fraudsters’ favorite ticket fraud
There are a variety of ways that fraudsters can take advantage of unprotected events and ticket retailers. The most common way is through classic card-not-present (CNP) fraud. If the fraudster himself wants to check out the latest off-Broadway play hitting their city, they’ll simply purchase stolen credit card numbers from the dark net and buy themselves a ticket. In order to avoid detection and ensure they’ll get in the door with the ill-gotten ticket, purchases are made last minute. Unfortunately, this tactic leaves the point of purchase on the hook for the cost when the true owner of the credit card reports it to their bank.
Ticket merchants also can’t discount friendly fraud. This occurs most often when excited potential attendees cannot afford to attend but do so anyway. These amateur fraudstersmake legitimate purchases, attend the event and then file a claim with their credit card provider that their information was stolen and used fraudulently.
The show must go on
Ticket fraud shows no signs of slowing down any time soon, making it crucial that event organizers selling their own tickets and ticket retailers alike implement a proactive fraud management strategy and mitigate the risks associated with ticket fraud. The right solution will protect your consumers, your event, and most importantly your profits.
Partner with a proactive fraud prevention solution backed by a consortium of fraud data to stop ticket fraud at the beginning of the process. Consortium networks utilize the power of machine learning and shared fraud data from organizations all across the globe to analyze and detect risky transactions where credit card information is stolen or customers who’ve engaged in friendly fraud with other retailers. By stopping ticket fraud before tickets are in hand, more legitimate attendees get the seats and you protect your bottom line revenue by avoiding chargebacks.
Want to see proactive ticket fraud prevention in action? Click here to learn how a fast-growing ticket retailer was able to slash manual reviews in half.