It’s the most wonderful time of the year – for fraud

The holiday shopping season always manages to sneak up on us. One day you’re preparing your costume for Halloween, then suddenly, end-of-year celebrations are right around the corner and you still have a dozen friends and relatives to shop for.

This accelerated timeline leaves many of us in scramble mode, which is exactly what fraudsters are counting on. Every holiday season, spikes in online web traffic from last-minute shoppers all over the world create new opportunities for bad actors to capitalize on. Camouflaged by the chaos of the holidays, fraudsters launch a series of sophisticated attacks and various scams designed to fool hurried shoppers and gain access to their sensitive data and credentials.

To combat these attacks, many businesses implement comprehensive security measures in their digital checkout process. But these heightened guardrails often come at the expense of a quality user experience, frustrating customers during the most important shopping time of the year.

The good news? It doesn’t have to be that way. With the right strategy, retailers can secure transactions without upsetting customers whose patience is already thin during the holidays — and they can use behavioral biometrics to do it.


Woman shopping on mobile during holidays

The holiday shopping season can be just as frightful as the weather outside

Despite the chaos, the holidays are a lucrative time for retailers. It’s the season when they generate a big chunk of their annual sales and push to hit key revenue goals. And the holidays are only growing more and more financially important for retailers over time, as the value of holiday retail sales in the U.S. has risen every year since 2008, reaching $889 billion in 2021.

The holiday shopping season is also getting longer. In 2020, nudata monitored online traffic patterns and discovered that the holiday season started three weeks earlier than the previous year, beginning as early as October 11. The trend continued in 2021 and in 2022, as one quarter of consumers had already started their holiday shopping as early as September. In theory, this is good news for retailers. A longer holiday season means greater earning potential for brands that capture consumers’ attention. Unfortunately, these factors also offer bad actors additional opportunities for fraud.

As online traffic increases, customers often struggle to distinguish legitimate brand interactions from scams. Bad actors use tactics like fake holiday coupons, spoof websites, and deceptive package delivery updates to seamlessly blend in with the real holiday promotions customers see every day. They incorporate sophisticated attacks as well, imitating human behavior and sidestepping many of the traditional security measures retailers rely on to protect online shoppers. And even worse is that sophisticated attacks are on the rise, and that they accounted for 47% of all attack traffic in 2021.

Retailers know this is happening. In response, many retailers double down on traditional security measures, adding more friction to account modification and checkout processes. While this approach improves security, it hinders the user experience and creates unhappy shoppers who are usually in a hurry to complete their purchases. But a growing number of retailers are recognizing the importance of protecting customer data without frustrating shoppers with excessive security precautions.

That’s where behavioral biometrics enter the scene.

Behavioral biometrics are the key to a more secure holiday season

Behavioral biometrics go beyond device-based insights to enable your organization to develop user profiles based on behaviors like typing cadence, time spent on a webpage, and mouse movements As a customer interacts with the platform, their associated profile becomes more comprehensive. When the customer’s behavior deviates from what’s expected, your team can step in and introduce additional points of friction to verify the user’s identity and lock out potential fraudsters.

But these additional points of friction must align with customer expectations and promote a sense of security, rather than frustration. Every customer will accept a certain level of friction in retail transactions — but the amount of friction they’ll accept is determined by the context of the transaction itself. For example, a customer won’t mind completing extra security or login steps if they’re making a large purchase on a new website. But if they’re forced to jump through too many hoops to complete a routine purchase, there’s a good chance they’ll grow frustrated with the experience and the retailer.

If you fail to understand the importance of personalized user experiences and treat every user the same, you’ll upset trusted consumers in the process. But by investing in behavioral biometrics, your organization can strike the right balance between security and convenience during the holidays and throughout the entire year.

‘Tis the season to prepare for next holiday season

The holidays can make or break a retailer’s year. But if your customers are exposed to fraud or frustrated by one-size-fits-all security measures, your holiday shopping season won’t be as successful as it could be. Developing a thorough understanding of your customers and building digital security practices around those insights is the best way to prevent fraudsters from derailing your holiday retail season.

But it’s not enough to implement behavioral biometrics right before the holiday season kicks into high gear. The simple truth is that you should have multi-layered security solutions in place year-round, capable of accommodating spikes in fraudulent activity in real-time. So, as the holidays wrap up this year, consider whether your business — and your customers — could benefit from more personalized security measures in 2023 and beyond.