Billions of people visit online marketplaces each year to source goods and services. Of these numbers, hundreds of millions of shoppers come from the US alone. With these staggering statistics, you may be tempted to dismiss the grim reality that the online marketplace is rife with security risks affecting businesses and customers. However, security risks are an everyday reality.
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Some common risks businesses face in online marketplaces include data breaches, identity theft, and fraud. The hazards to shoppers include counterfeit goods, scams while buying or selling, and exposure to malware by threat actors. This article will explore the risks businesses and shoppers face in marketplaces and a few solutions to these security risks.
Common Marketplace Security Risks And Solutions
1. Data Breaches
Data breaches are common in the online marketplace, affecting both long-established businesses and startups. Data breaches occur when cybercriminals infiltrate a company's servers, gaining unauthorized access to sensitive information such as credit card numbers, addresses, and passwords. These security lapses can stem from various causes, including targeted system attacks, unintentional employee mistakes, or even the oversight of third-party service providers.
To safeguard businesses against threats and avert data breaches, online marketplaces must ensure their systems are always up to date. Additionally, they should refrain from storing sensitive data like credit card information and carefully regulate access to sensitive information within their organization.
IT experts, having identified the data breach threats in the US, now offer IT consulting services in Charlotte to protect online marketplaces.
2. Payment Fraud
Payment fraud in the online marketplace can present itself in many ways. One of the common ways fraud happens is by using stolen credit and debit card numbers to buy large amounts of goods from online marketplaces, then reselling them for a profit. Unfortunately, the use of stolen identities to open accounts and make fraudulent purchases online is also quite common.
Payment fraud causes businesses financial losses and the loss of customer trust when they fall victim to scams in a marketplace, among other problems. Typical solutions marketplaces can take to reduce or eliminate payment fraud include incorporating secure payment gateways and multi-factor authentication for extra security to employees and customers, who can then secure their login and payment process.
Also, online marketplaces need to invest in fraud detection and prevention tools that will flag suspicious transactions. Far from that, online marketplaces must monitor transaction patterns and customer behaviors to detect anomalies or suspicious activities that may indicate fraud.
3. Phishing and social engineering attacks
Social engineering is psychological manipulation to get marketplace visitors to share sensitive information with someone that has malicious intent. On the other hand, phishing involves sending fraudulent emails or messages that seem legitimate but contain links or attachments that lead to phishing websites. When a victim clicks the link or opens the attachment, they get directed to websites that steal personal information such as social security details, passwords, credit card details, etc.
There is no one size fits all solution to phishing and social engineering attacks as they vary and change over time. However, some of the practices that businesses can put into play include the following:
- Training employees to recognize phishing emails to avoid losing business and customer data.
- Implementing multi-factor authentication will make it harder for a phisher to attack your marketplace system even with a password.
- Constantly monitoring systems for any signs of a phishing attack.
4. Fake Reviews
Fake reviews give a perception of a product that is not true, thus misleading potential buyers and damaging the reputation of businesses. Fake reviews can cause customers to lose trust in the products and services offered in a marketplace. Plus, they may attract the scrutiny of regulatory authorities and review platforms, potentially leading to a loss of business for the marketplace.
Some steps to weed out fake reviews include manual moderation, automated algorithms flagging suspicious reviews, and encouraging 'verified' purchase reviews to confirmed buyers. Also, marketplaces should encourage customers to report questionable reviews and implement user verification processes, making it difficult for reviewers to create multiple accounts on your platform.
5. Counterfeit Products
The growth of e-commerce has increased the demand for cheaper versions of popular items. To the same degree, counterfeit products also flooded the market. So pervasive is the counterfeit product market that it is estimated that more than half of the products in the marketplaces are counterfeits.
Fake online products enhance unfair competition, destroy the reputations of brands whose products have been counterfeited, and cause massive revenue loss.
The solution to this menace is implementing strict verification processes for sellers on your platform and collaborating with brands to identify and remove counterfeit listings. You can also cooperate with law enforcement to prosecute sellers of counterfeit goods on your platform.
Marketplaces are a great way to get sellers to sell their products and make money. To bring them on board and keep them, you must build robust systems to ensure their businesses and customers are safe and secure in your marketplace. The tips shared in this article and IT experts' help can help you get a safe marketplace up and running in no time.