Grinch Bots Are Targeting Online Retail. Are You Prepared?

As the 2023 holiday shopping season approaches, how confident are you that:

• Your products are being sold to real customers and not bad bots?
• Your customer data is accurate?
• You aren’t spending real dollars on fake traffic?

Very confident? If so, think again.

Almost a quarter of all retail site visitors are bad bots. These malicious actors snatch products, skew analytics, and steal customer accounts.

The numbers jump even higher during hyped holiday season sales and product drops. Last year, bot traffic spiked 50 percent during Cyber Week. During one hyped product launch Queue-it worked with, up to 97 percent of all traffic came from bots.

You can say you’re not concerned. That a sale is a sale, whether it’s made by a shopper or a bot. But how do you feel about higher costs? Or more customer complaints? How do you feel about more website crashes and slowdowns on your biggest days?

Bots do far more damage than just throwing your analytics out of whack. They directly impact your bottom line and brand reputation. Let’s look at how.

Bots Increase Costs

Bots cost the average enterprise 3.6 percent of its annual online revenue. For 25 percent of the businesses Netacea surveyed, this equates to $250 million per year.

Up to 80 percent of e-commerce operational costs are negatively impacted by malicious bots.

Where do these costs come from?

• Website infrastructure: If 40 percent of your website traffic is fake, 40 percent of your cloud computing bill is spent on illegitimate traffic.
• Advertising and marketing: Pay-per-click advertising is great, until you find out the “clicks” you’re paying for aren’t even real people; data is crucial to marketing, but bad data leads to bad decisions.
• Technical and customer support: Bots clear out stock, take over genuine customer accounts, and flood websites with traffic until they slow down or crash — all of which increase the load on your teams.
• Checkout fraud: Bots abuse e-gift card transactions (60 percent of which are fraudulent), and they use stolen accounts and credit cards that spike chargebacks (which cost merchants 47 percent of their annual revenue) and drain your fraud team’s resources.

Bots are there at all stages of the user journey, adding costs and cheating customers.

Bots Increase Complaints

Customers are familiar with bots. In one survey, more than half of all customers said they knew what a bot was. And if you’re selling hyped tech products or sneakers — where the demographics skew younger — awareness of bots is even higher.

When bots snatch products out of the hands of consumers, the shoppers feel they’re being cheated.

And what do consumers do when they feel they’re getting cheated? They complain.

To shoppers, a company that doesn’t care about bots is a company that doesn’t care about its customers. They feel you don’t have their best interests at heart, that you’re not working hard enough to stop bad bots, or both.

That’s why 35 percent of online businesses report bot attacks result in brand or reputational damage.

And even if your customers don’t know what bots are, they almost certainly know — and know how to complain about — website crashes.

Bots Increase Crashes

Queue-it’s analysis of a recent hyped sneaker drop found that up to 97 percent of the traffic was non-human. Of the 1.7 million visitors who tried to access the sale, less than 100,000 were playing by the rules.

Yes, bots are a problem for your costs and your customers, but they’re also a problem for your website. The load on this retailer’s website was 1,600 percent more than it needed to be. Without the virtual waiting room this retailer used, traffic like this would have almost certainly brought its site crashing down.

Forty-five percent of online businesses said bot attacks resulted in more website and IT crashes in 2022. For 91 percent of enterprises, the cost of downtime like this exceeds $300,000 per hour, making bots — and site crashes — a non-trivial problem.

When Walmart released the PlayStation 5 on Black Friday, for example, the company reported more than 20 million bot attempts in just 30 minutes. Walmart’s site crashed multiple times throughout the day.

Bots took down the website of America’s largest retailer on America’s largest shopping day. If Walmart can be a victim of bots, so can your business.

Blocking Bots is Good for Your Bottom Line

Costs. Complaints. Crashes. If you’re concerned about any of these issues, you should be concerned about bots.

So as you plan your holiday season sales and marketing campaigns, you need to plan for the accompanying onslaught of Grinch bots. How? Here are some basic steps:

• Block simple, known bot traffic.
• Monitor traffic and identify sophisticated bots.
• Act on flagged traffic.
• Filter bots and secure your site with web traffic management.
• Allocate time for after-sale audits.

These steps, and the use of bot mitigation software, will prove crucial for the 2023 holiday season and beyond. Because as brands like Nike, Amazon.com, Sony, and Foot Locker recognize, the fight against bots is a fight for your customers, your brand, and your bottom line.

Jesper Essendrop is the CEO of Queue-it, a leader in virtual waiting room software and services.