Understanding the Business Impact of Bots on Merchants' Bottomline
By Angel Grant
As a payments and security professional, you know automated bot attacks are more than a threat to your security infrastructure—they represent a business challenge that must be addressed to preserve your organization’s operations and fiscal viability.
However, the costs that criminals impose through bots can be so varied that it can be challenging to explain to an organization’s business leaders the broad economic and operational impact of malicious bot traffic.
Indeed, bot attacks can have serious economic consequences: Global online fraud losses linked to bot attacks are projected to exceed $48 billion a year by 2023, and online fraud associated with bots is projected to grow 131.2% between 2022 and 2027, according to a report by Juniper Research. However, the damages wrought by bots go beyond revenue loss: Malicious bot attacks can jeopardize your customer experience initiatives, increase the cost of gaining new customers, and reduce opportunities to upsell products and services. And that’s before tallying the human cost of bot mitigation: According the Forrester Total Economic Impact Report, teams can waste up to 10,000 hours annually on manual bot protection.
The many faces of malicious bots
Bot activity and attacks can take on multiple forms, and pursue different ways of interfering with your sales, web operations, and customer relationships. Following are examples of common types of bot attacks that threaten successful e-commerce activities for both retailers and their customers.
Content scraping involves the use of automated bots to collect large amounts of content from target websites to analyze, reuse, or sell that data elsewhere. While content harvesting has legitimate uses (online travel aggregators scrape airline websites to gather airfare information, for instance), scraping can also be used for illegal purposes, including price manipulation by competitors and the theft of copyrighted content. In addition, high volumes of scraping activity can impact site performance and prevent legitimate users from accessing a site.
The impact of scraping can be particularly damaging during periods of high shopping activity, when your e-commerce site is already busy with prospective customers. Competitors may be extra motivated to gather up-to-date pricing data from your site to make their own rapid price adjustments, and the extra traffic can bring down or slow your site, making it unresponsive to your shoppers. In an online shopping environment, performance counts. Your competitors are just a click away.
Inventory is hard to manage at the best of times, but retailers are facing particularly difficult trials during today’s supply chain crisis. Inventory hoarding bots can add to the logistics challenge by placing large numbers of products on hold, thereby removing them from your inventory and preventing actual customers from making a purchase. Sustained inventory hoarding, and other forms of bot manipulation, can frustrate shoppers and threaten customer loyalty and brand reputation, to say nothing of impacting revenue, as consumers can easily go elsewhere to make their purchase.
Retailers who offer limited time, or limited inventory, products for sale run the risk of purchasing or scalper bots, which can complete the online buying and checkout process instantaneously to purchase goods in bulk the moment they go on sale. These items are then usually resold on secondary markets at a significant mark-up.
Both hoarding and purchasing bots allow criminals to control valuable inventory or prices, leading to artificial scarcity, denial of inventory, and consumer frustration.
Credential stuffing and account takeover is another bot-driven exploit that can interfere with e-commerce success. Attackers test large numbers of compromised credentials (such as usernames and passwords breached from another site) against another site’s website login forms to gain access and hijack those accounts for monetary gain or to commit fraud.
Bot management is cost management
Increasingly, automated bot attacks represent an economic challenge that businesses and organizations must address for the sake of their bottom line and the safety of their business operations. To achieve their revenue goals, companies must protect their customers and clients from fraud and account takeover and relieve their security teams of manual and ineffective anti-bot workflows.
A series of reports have captured the financial and business consequences that result from automated attacks by bots, making it easier for security professionals to point business leaders to the fiscal impact of cybercrime and discuss the return on investment (ROI) of dedicated anti-bot solutions. To help payments and security professionals better communicate the costs that automated bot attacks can inflict on your organization and the business benefits of successful bot management, read the F5 white paper From Bots to Boardroom: How Bad Bots Negatively Impact Your Balance Sheet. We intend this document to serve as a launching point for conversations among infosec and fraud teams and the C-suite regarding the top-line and bottom-line impacts of malicious bot attacks and the significant financial advantages of effective bot defense technologies.
In addition, F5 has developed two methods of analyzing the business impact of bot traffic to your organization and the ROI of successful bot mitigation technologies. Find out how much malicious bots are costing your business in fraud, infrastructure expenses, employee burnout, and lost customers by signing up for a free and comprehensive bot business impact analysis customized to your business and industry. Or use the free bot impact calculator today for a high-level view of the business impact of bots on your organization.
The primary takeaway here is that bot management is an important cyber and economic resiliency topic – especially in times of a recession. Elevating the bot discussion with your C-suite is the first step in addressing the threat that malicious bot attacks present to your company’s business operations and fiscal health. Find out how you can meet the demand for cyber and economic resilience.
Protect your customers—and your bottom line with F5
F5 is a multi-cloud application security and delivery company that enables customers to bring extraordinary digital experiences to life. F5’s portfolio of automation, security, performance, and insight capabilities empower many of the world’s largest enterprises, financial institutions, merchants, service providers, and governments to create, secure, and operate adaptive applications that reduce costs, improve operations, and better protect users.
In this video Dan Woods, F5’s Global Head of Intelligence, discusses the greatest threats facing today’s merchants and provides examples of how F5 helps companies mitigate fraud.
For more information about F5, visit http://f5.com