SOURCE: eMarketer

March 15, 2005 11:30 ET

eMarketer: Fraud, Related Losses to Grow With eCommerce

Report Explores Consumer, Merchant Perspectives

NEW YORK, NY -- (MARKET WIRE) -- March 15, 2005 -- Online fraud is married to the fortunes of e-commerce -- both for better and for worse, according to a new eMarketer report.

"As e-commerce revenues grow, we foresee significant growth in fraud and fraud losses as well," said eMarketer Senior Analyst Noah Elkin. "However we believe it is unlikely that fraud losses will rapidly eat up a significantly larger share of the overall total."

The report, released today, focuses largely on the increasingly organized nature of 'cyber-crime' and illustrates the challenges facing consumers and merchants.

The threat of online fraud cannot be ignored, Elkin said. Just as crime will never be completely eradicated on the streets, it will never be eradicated in cyberspace, though the biggest threat lies in public perceptions.

"Online fraud represents a tiny portion of overall online commerce, but studies suggest that consumers are increasingly nervous about digital transactions," Elkin said. "A single high profile incident could create the impression that all online commerce is insecure -- and curtail business across the board; a string of negative incidents could significantly dampen the growth of e-commerce."

Merchants must be clear, credible and persuasive about security measures, Elkin suggests, as buyers are paying more attention to the identity of sellers, and funneling their purchases to trustworthy brands. "The bottom line is that online enterprises must not only pay close attention to evolving security concerns, but also demonstrate that attention to their customers, partners and suppliers."

About eMarketer

eMarketer, the world's leading aggregator of e-business and Internet statistics, provides objective market projections and analysis to online professionals in more than 140 countries nationwide. eMarketer's eStat Database is the most comprehensive compilation of up-to-date e-business and online marketing statistics in the world. For more information, visit http://www.emarketer.com.

Contact Information