Profit Efficiency as a Risk KPI

Many eCommerce companies use a variety of metrics and key performance indicators (KPIs) to evaluate how effectively they are meeting specific business objectives. This presentation begins by looking at what KPIs are, and uses simulated data to help demonstrate shortcomings with chargeback KPIs like chargeback rate and weighted chargebacks. Next, false positives and control groups are discussed, followed by the concept of a confusion matrix. A new approach called profit efficiency is then defined, along with its functions and a comparison of profit efficiency with other KPIs in regular and peak seasons. The review concludes with a look at six advantages of using profit efficiency as a KPI.

For more information on profit efficiency, please click here to view the whitepaper "Maximizing Profit Efficiency as Overall Evaluation Criterion for Fraud Control."