Shimano Case Study
Payment gateway filters
The Shimano company and brand is dedicated to assisting and advancing wholesome, healthy interactions between people and nature. Their innovative technologies produce high-quality bicycle products and sporting equipment that enhance the enjoyment and performance of bicycle enthusiasts and outdoorsmen across numerous countries and regions globally. For decades, Shimano primarily operated through their OEM and Dealer Network business, and only recently entered the eCommerce D2C market with the launch of four Shopify websites.
The Fraud Problem
The high precision and durability of Shimano products, technology, and design come with a corresponding high price tag. As with all high-end merchandise, they tend to tempt fraudsters and thieves with the possibility of a substantial payoff.
Prior to launching Shimano Indoor Bicycle, Frank Martinez, head of D2C at Shimano North America Holding, encountered a series of high dollar chargebacks on one of the sites within the Shimano family of brands. Having learned from experience, Frank ensured his sites were set up with a fraud prevention system prior to launching the new Shimano sites.
To prevent fraud, Frank Martinez relied entirely on Shopify’s built in fraud prevention system and the filters provided by his payment gateway. His gateway filters were set conservatively, assuming this was the best way to keep the business safe from fraud. Any order with a billing address that didn’t match what the card company had on file was automatically declined, as was the case with any order made with an international credit card or if there was an incorrect or mistyped CVV code.
Shimano’s customer base is primarily comprised of athletes and road cyclists. Due to the outdoor requirement of the sport, many bicyclists travel to warmer climates during the winter months to partake in races and better enjoy the activity. To aid in their ease of travel, customers will order Shimano products and equipment and have the items shipped directly to their travel destination. Their order will reflect miles of distance between their shipping address and billing address, which frequently resulted in Shopify flagging the order as ‘High Risk.’
Similarly, customers participating in overseas triathlons would attempt to have their orders delivered to a freight boarding service to Europe or the Middle East. This would automatically register as a ‘High Risk’ transaction by Shopify and the order would be canceled. Additionally, international customers were not able to check out at all, as the gateway filters put in place restricted the use of all International Credit Cards without exception.
Distressed customers would call Shimano’s customer service department frustrated over their canceled orders and disrupted travel arrangement. The only solutions Shimano had was to either direct them to a local retailer or have their customer service team do extensive research to determine the validity of the transaction, often resulting in order delays and frustrated customers. So much time and energy was being diverted from growing the new business to deal with these fraud related issues.
It became increasingly clear to Frank that it was time to upgrade his fraud prevention system to a more advanced, intuitive solution, and specifically, one that would accurately distinguish legitimate consumers with unusual purchasing patterns from actual fraudsters.
Shimano’s Fraud Prevention Requirements
In his search for new fraud prevention software Frank prioritized credibility and a strong market presence. “When I look for technology partners, I am happy to try new and upcoming solutions for something like affiliate marketing, but for fraud prevention I needed something I knew I could rely on. I specifically looked for a solution with a strong track record of accuracy and reliability.” His goal was to offload the fraud prevention responsibility entirely, so that he could focus on making sales and driving revenue. Other important factors were; ease of integration, customization and usability; approval rates; and competitive pricing.
One of the biggest considerations was integration with his current ERP system. Shimano’s order retrieval system operates by gathering orders into a temporary block and loading them into their ERP every 15 minutes. Frank was looking for a fraud solution that would cancel fraud attempts before they turned into orders, thereby blocking them from ever entering his ERP system.
“Of utmost importance to Shimano was the availability of human review and agents to work with the company, or the customer, should an order need extra attention. Being able to work out an issue with a human was key, especially in gathering additional information from the customer to approve an order. NoFraud’s chargeback protection and fighting those chargebacks on our behalf was icing on the cake.”
The NoFraud Difference
NoFraud responded quickly and with enthusiasm, always ready to listen, discuss, adapt and deliver.
After researching the available solutions, NoFraud and one competitor were left on the shortlist. To assist him in the final decision, Frank reached out to current NoFraud users. Each of them attested to NoFraud’s firm commitment and vested interest in the success of their customers, highlighting the excellent customer service they received as NoFraud customers. Any time a NoFraud customer had a suggestion or idea of how to improve their system or experience, NoFraud took the recommendation seriously and was often able to implement the improvements quickly.
The feedback from satisfied NoFraud customers was invaluable to Martinez, as he knew that collaboration and customization would be necessary for his websites. The NoFraud team understood his integration requirements during the vetting process, and quickly came up with an easy solution and confirmed compatibility. Ultimately, ease of integration was another major determining factor.
Convinced of NoFraud’s effective integration capabilities, coupled with the excellent feedback he gathered from existing customers and publicly available review sites such as G2, Frank opted to use the NoFraud solution.
Shimano’s approval rate currently stands at over 99.6%. NoFraud approves orders that would have otherwise been automatically declined, such as purchases by tourists visiting Florida off cruise ships and using international credit cards, and orders made from a customer in the Middle East with a billing address in Minnesota and a shipping address in Arizona. Before partnering with NoFraud, orders of this nature were a source of lost revenue. With NoFraud’s powerful AI tool validating those orders instantly, Frank is able to focus on where his time is best spent, growing Shmiano’s online business.
“NoFraud’s responsiveness and readiness to be flexible and collaborative, is unmatched. The speed and ease of communication makes working with NoFraud a continually great experience. My customer service team is no longer busy assuaging angry falsely declined customers and now spend their time building more meaningful customer relations, such as discussing products and aiding in purchasing. Above all, I am entirely alleviated of fraud concerns, I don’t even check what the NoFraud system is doing anymore, I can trust them implicitly and focus on expanding my business. Choosing NoFraud was absolutely the right decision.”Frank Martinez
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