New CyberSource Service Automates Online Order Acceptance
Decision Manager to help merchants move beyond fraud control to reducing cost of review and valid order rejection
MOUNTAIN VIEW, Calif., June 22, 2004
Many eCommerce merchants today are succeeding in reducing fraud rates to less than 1% of sales. The next and much larger battle: automating the entire order acceptance process. CyberSource Corporation (NASDAQ: CYBS) today announced the launch of Decision Manager, a new service designed to successfully limit not just the direct fraud problem, but also the related and costly issues of order review and valid order rejection. CyberSource Decision Manager offers the industry's most powerful anti-fraud tool, CyberSource Advanced Fraud Screen enhanced by Visa, coupled with a system that provides a new level of order review automation—all in a package useable by non-technical management.
The order acceptance challenge: Web merchants are currently manually reviewing almost one out of four online orders, up from one in six only three years ago. eCommerce is growing by approximately 35% per year. The convergence of those two trends means the order review process is headed for a crisis. Today's eCommerce managers must typically employ multiple fraud and order review tools and work with IT support to develop custom logic for the appropriate handling of products and orders. Business rules must be combined with automated decisioning to yield an appropriate accept/reject/review disposition for every order in every scenario. This difficult situation frequently forces companies to choose between high personnel costs required for extensive manual review or high order rejection rates due to rudimentary or overly conservative acceptance rules. Both choices decrease revenue and profitability.
The CyberSource Decision Manager solution: With CyberSource Decision Manager, business managers can now create rules to easily manage the entire order acceptance process through a single, easy-to-use dashboard interface. There is little or no need for IT resources. Based on criteria defined by the merchant, the new service automatically decides whether incoming orders will be accepted, rejected, or suspended for review. Orders suspended for review are temporarily held in a case management queue for fast review and disposition. Decision Manager pinpoints the reasons why each transaction was moved to that queue enabling quick review and conversion decisions. Whenever the merchant decides to add or modify business rules, the impact of new decision criteria on the company's pending orders can be easily assessed through one of two test modes.
"As critical as online fraud prevention is, it is also just the tip of the iceberg," said Robert Ford, chief technology officer for CyberSource. "Direct fraud averages about 1% of orders. But, rejection of orders affects another 3-4% of a merchant's business, and a full 23% of orders are now being manually reviewed. There's not much electronic about that commerce. The new frontier for those of us in payment is the creation of systems that can automate the order acceptance process. This should allow merchants to convert more orders to sales, confidently review fewer orders, and more quickly manage orders that are assigned to the review queue. We believe Decision Manager is the first complete answer to the challenge."
Configurations and capabilities of CyberSource Decision Manager
The new service comes in two principal configurations, Standard and Advanced Editions. The Standard Edition, with a complete menu of pre-built business rules, will meet the needs of businesses that have a relatively uniform product or service portfolio. The Advanced Edition will better serve merchants with distinctly different product categories, since it provides custom rule development and the ability to implement multiple order screening profiles. Both Standard and Advanced versions offer sophisticated fraud screening through CyberSource Advanced Fraud Screen enhanced by Visa, a market-proven world standard in risk management technology. Both versions provide a ready-to-use hosted system with extensive rule authoring capabilities, robust order screening services, a complete business rule test environment, case management tools, and extensive management reporting. Both editions work through a management console that allows selection of rules and fraud control tools with radio buttons or menus. Both also offer data export (via XML interface) to order management systems, CRM systems, and case management systems.
For those merchants with special requirements, such as a need for the decision system to interact with in-house databases or uncommon third party services, CyberSource also offers a custom edition of Decision Manager.
More information is at www.cybersource.com/decisionsolutions.
Standard Edition specific capabilities
Business rule dashboard—Easily creates order screening profiles using an extensive library of pre-built rules. Users simply click to "accept", "reject", or "review" the transaction if the rule is triggered. "Ignore" can be selected if users want the rule to have no effect.
Case management—Orders tagged as "review" or "reject" are automatically sent to a case management queue for review and conversion. There, users can see which rule caused the order to be suspended or rejected, and access is provided to all associated transaction details. Better, faster, more informed decisions can be made, all through the user's web browser.
Pre-configured reports—Users can automatically generate five key reports to assess rule performance.
Passive-mode rule testing—Users can run new screening strategies against current orders as a test and consequently assess rules without fear.
Data export capability—All data from CyberSource Decision Manager can be exported to resident order management systems, CRM, and case management systems via XML interface.
Advanced Edition specific capabilities
Advanced Edition has all the capabilities of Standard Edition plus:
Custom Rule Builder—This easy-to-use tool allows users to create rules based on order data fields (e.g., "If product is diamonds or SKU 45678 and shipping overnight, then . . . ").
Multiple order screening profiles—Multiple screening files can be created based on product category, SKU, order amount, method of shipping, country of origin, currency, or other order criteria. The appropriate screening profile is then automatically selected based on the attributes of the order.
Case management with multiple review queues—Up to eight review queues can be created. These can be used to prioritize reviews (e.g., isolate same-day orders from routine shipping), or to direct certain orders to the attention of specially trained reviewers.
Two test modes—In addition to the passive mode (available in Standard Edition), Advanced Edition users can employ "Replay" mode, in which past transactions can be played against new screening strategies to assess results.
Advanced reporting—Four reports are provided to analyze performance of profiles and reviewer queues.
Availability
All editions of CyberSource Decision Manager are available now. Decision Manager can be used on its own with any payment system, or as part of a complete eCommerce payment solution from CyberSource.
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"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995
Statements in this release that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, without limitation, statements regarding the Company's expectations, objectives, anticipations, plans, hopes, beliefs, intentions or strategies regarding the future. Forward-looking statements in this release include, without limitation, statements regarding: (1) fraud rates; (2) growth of electronic commerce; and, (3) use of Decision Manager leading to increases in revenue or profits. Factors that could cause actual results to differ materially from the forward looking statements include risks and uncertainties such as new products and services offerings by the Company's competitors and other risks indicated in our filings with the Securities and Exchange Commission. It is important to note that actual outcomes could differ materially from those in such forward-looking statements. Readers should also refer to the documents filed by CyberSource with the Securities and Exchange Commission, specifically the annual report filed on Form 10-K for the year ended December 31, 2003, filed with the Securities and Exchange Commission on March 11, 2004, and our quarterly reports filed on Form 10-Q from time to time, all of which identify important risk factors.
