Up to 80% of operational costs are negatively impacted by malicious bot activity
PerimeterX, the leading provider of solutions that secure digital businesses against automated fraud and client-side threats, today announced the release of a definitive study on the financial impact of malicious bots in retail e-commerce, Quantifying the Impact of Bad Bots on E-commerce Merchant Profitability.
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Conducted by Aberdeen Strategy & Research, the analysis estimates that 75-80% of e-commerce operational costs — e.g., the cost of website infrastructure, website marketing and the total cost of checkout fraud — are negatively impacted by malicious bots, which equates to between 18-23% of net revenue across the six popular e-commerce retail categories that were the focus of this study.
“Bad bots represent a material and growing problem for e-commerce merchant profitability, and currently their negative business impact is not that well understood,” noted Derek Brink, CISSP, vice president and research fellow for Aberdeen Strategy & Research. “We found, however, that advanced bot detection and mitigation services can reduce this negative impact by more than 50% at times of peak bad bot traffic, which contributes directly to protecting the bottom line,” Brink said.
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The research was conducted with e-commerce merchants in popular retail categories involving physical goods including consumer electronics; fashion and beauty; food and beverage; furniture, appliances and home improvement; general merchandise; and health and leisure. Respondents generated between $50M and $2.5B in annual revenue from their primary e-commerce segment, the majority of which was from online shoppers in the United States.
“Heading into the year’s biggest shopping season, it is critical that retailers fully understand the significant impact that bad bots pose to websites and mobile apps. It has gone beyond security and brand protection to become material to their overall financial performance. Quantifying the impact of bot-related attacks is a challenge. Our goal with this report is to shine a light on this murky problem, and help the industry find the right solutions,” said Kim DeCarlis, CMO, PerimeterX.