Customer Service

Stopping fraud without sacrificing customer experience: A real-time playbook for modern retail

If your fraud strategy currently prioritizes protection over experience or vice versa, it’s time to rethink the balance. Modern fraud prevention should do both, in real time.

Photo: Adobe Stock

January 9, 2026 by Bill Bruno — CEO, Celebrus

Fraud has stopped behaving like a seasonal spike. It's now a constant pressure on retailers, showing up in new channels, blending in with legitimate behavior, and accelerating through automation. At the same time, customer expectations have never been higher. Shoppers want fast checkout, seamless recognition across devices, and zero interruptions. The tension between those two forces defines modern retail: protect the business, but don't get in the customer's way.

Getting that balance right requires more than stronger tools. It demands real-time decisioning, cleaner identity data, and a clear understanding of where friction actually belongs. Below is a practical playbook for strengthening fraud defenses without sacrificing the experience customers expect.

1. Audit the fraud stack you already have

Most fraud programs weren't built in a day. They're the result of years of patching, incremental rule changes, and tool layering. Over time, that leads to complexity and blind spots.

A detailed audit usually reveals three things:

Rules that are still active even though the behaviors they target disappeared years ago.
Thresholds set far too low or high for today's volume.
Gaps where static models can't keep up with rapidly shifting attack patterns.

Retailers don't necessarily need more tools; they often need sharper visibility into what their existing tools are actually doing. Start with a simple question: Which parts of our stack are helping us, and which are slowing customers down?

2. Strengthen your digital identity foundation

Fraud detection hinges on recognizing who's on the other side of the screen — not just at checkout, but throughout the entire journey.

That requires a unified view of each shopper, consistent identity signals across devices and channels, and first-party behavioral data that updates in real time.

Without this, even the best fraud systems operate with partial context. Unifying identity reduces false positives, strengthens trust signals, and gives retailers a clearer sense of normal vs. abnormal behavior. When identity is accurate, every fraud decision becomes more precise.

3. Test your environment for bot and automation threats

Automation is now a core part of fraud operations. Bots can mimic gestures, timing, scroll patterns, and even hesitation. Many retailers don't discover automation risk until it's already affecting inventory, checkout performance, or account integrity.

Behavioral biometrics — analyzing how a customer interacts, not just what they enter — can distinguish humans from automated tools long before payment. Retailers should routinely test their sites and apps for bot resilience, not just monitor for attacks after the fact.

A retailer that understands its automation exposure is always a step ahead of the attacker.

4. Apply friction with precision, not universally

For years, "more friction" was treated as the safest path. Step-up authentication, CAPTCHAs, and added verification became common, even when risk was low.

This creates a frustrating customer experience and often ultimately results in a lost sale.

The goal isn't to eliminate friction but to apply it only where the risk justifies it. When retailers rely on real-time signals, legitimate shoppers glide through the journey, while questionable behavior triggers added checks.

Done well, this keeps good customers happy and fraudsters frustrated.

5. Shift from reactive monitoring to real-time response

The fastest fraud today happens in seconds. Attackers test credentials, use scripts to scale attempts, and pivot quickly when blocked.

A reactive approach — reviewing logs, adjusting thresholds days later — isn't enough. Retailers need signals and decisioning that operate in milliseconds:

Live behavioral data.
Automated alerts.
Rapid adjustments to evolving patterns.

Real-time response doesn't just stop fraud earlier. It prevents cascading customer impacts like account lockouts, false declines, or delayed approvals.

Better fraud prevention should improve customer experience

Fraud prevention and customer experience are often treated as opposing goals, but they actually reinforce each other. Better identity data means fewer false declines. Smarter automation defenses mean fewer slowdowns. Real-time analytics make it possible to separate trusted customers from threats without burdening everyone.

Retailers that build these capabilities aren't just reducing fraud loss — they're creating journeys customers return to again and again.

If your fraud strategy currently prioritizes protection over experience or vice versa, it's time to rethink the balance. Modern fraud prevention should do both, in real time.

About Bill Bruno

Bill joined Celebrus in 2018 as the vice president of North America and became CEO in October 2021. He has over 19 years of experience in the media, data, and analytics sectors and has a passion for fostering a culture of innovation while working with brands to drive transformational change. Prior to Celebrus, Bill spent many years as CEO (North America) for an AIM listed company upon leading his consulting business through a successful acquisition by that company in 2013.

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