business case 5

topic : preventing fraud during short term and long promotions
area 
: food retail, loyalty promotion, stamps fraud prevention/detection

For several food retailers we set up a model that detected possible fraud during long term and short term promotions. We looked especially at paper stamps based loyalty promotions and evaluated the spending behavior of shoppers vs. the number of items that these shoppers were able to collect until now. The fraud detection ran during the full promotional period and took various modifiers into account like supplier funded items that increased the turnover value eligible for collecting stamps, or special mechanics for private label items. The weekly analysis we did for these retailers revealed actual fraud set-ups by cashiers and consumers, and corrective measures were taken to eliminate or limit the damage. We witnessed that fraud is a common aspect during loyalty campaigns and inhibits ROI for the investment and promotional set-up so it is important to detect potential fraud cases as early as possible during the promotion. In these specific cases too many stamps were collected that could not be linked back to shopping/spending; that resulted in consumers collecting articles without growth in their shopping spend and in some case nothing was spent at all. The fraud model provided our clients with the possibility to monitor on a weekly basis the potential fraud cases and take corrective actions on store and cashier level.