Umzu and Kinobody Team Up With NoFraud For Optimal Financial Health

$48K In annual chargeback losses eliminated

0 Order delays

$63K In annual overhead eliminated

The Company

Umzu and Kinobody are sister companies founded in 2014 serving the health and fitness industry. Both have grown into successful national brands, boasting eight figure gross revenues annually.

The Challenge

By 2018, the companies had grown quickly and were grossing over a million dollars in monthly sales—but under the surface, they were fighting a losing battle against fraud.

The anti-fraud tools provided by Shopify were not sophisticated enough to keep pace with the increasing complexity of the fraudulent attempts on their stores, which resulted in an increasing number of chargebacks. In order to stem the mounting losses, Umzu and Kinobody hired a full-time employee whose sole responsibility was to review orders for fraud with the limited data provided by Shopify’s Fraud Filter. During the holiday season and sales spikes, they relied on the customer service team to help manage the queue of orders under review.

Despite the team’s manual review of all transactions—Umzu and Kinobody continued to get hit with $3,000-$5,000 in chargebacks each month. Factoring in the cost of chargeback fees; the amount of lost product and the associated shipping fees; salary and benefits for the dedicated employee; and time spent disputing the chargebacks, the total annualized fraud loss ballooned to $135,000. With stronger sales anticipated as 2019 approached, the companies were on track to lose even more to fraud. Urgently seeking a viable solution, the companies’ owner turned to NoFraud.

The Solution

Having demoed a few fraud prevention tools back in 2017, Umzu and Kinobody decided to install NoFraud on their Shopify stores. NoFraud’s deep integration into Shopify’s platform and compatibility with the third party checkout app, combined with their excellent reviews in the app store, made NoFraud the obvious provider of choice.

“I had installed NoFraud’s free trial, and was impressed with the service offering. At that point we were small enough of a business that I felt we could manage chargebacks in-house. In the months before re-installing NoFraud, the fraud attempts were increasing in sophistication, frustrating our fraud prevention analyst and customer service team and causing alarming financial loss. ur rapid growth magnified these challenges. I knew it was time to outsource our fraud prevention to the experts.”

The Results

From the moment of installation, NoFraud’s automated system instantly began finding and blocking fraudulent transactions, providing much needed relief from manual review and chargebacks.

“The stress the team was experiencing quickly evaporated. Aside from the obvious financial benefits, implementing NoFraud boosted the morale of my team. I certainly did not expect that outcome.”

Now that valid orders were being correctly identified and processed without the need for manual review, Umzu and Kinobody were able to focus on growing their business and redirect their customer service team to tasks specific to keeping their customers happy. Total annual fraud loss decreased from $135,000 per year to $0 per year , allowing the companies to use those funds for further investment in revenue generating projects.

“NoFraud cut our expenses drastically.”

"Operating two 8-figure brands opens us up to a lot of risk for fraud. By using NoFraud we've managed to cut our expenses drastically. With NoFraud’s full automation within Shopify, we've also freed up the resources of a full-time employee to service our customers better. We couldn't be happier with NoFraud as our chargeback solution."

Darren crawford COO, of Umzu and Kinobody