China Eastern Airlines Corporation Limited (China Eastern) is one of the world’s top five airlines in passenger volume1, carrying almost 80 million passengers annually. To get a bigger slice of the overseas market, the carrier wanted more visibility and control over its international transactions and the fraud risks that may impede business growth.
The airline started out with 3-D Secure, a payer authentication system, but soon felt it was insufficient fraud protection that left gaps in managing online payments. The fraud rate was kept low, but the order acceptance rate was equally low at below 60%. China Eastern also did not want to rely on in-house manual reviews, as it would be a huge resource investment, or implement rigid screening rules that would eliminate all potential traces of fraud but unintentionally reject more valid orders.
Snapshot view of CyberSoure & China Eastern Airlines
- Busniness challenge: An ineffective fraud strategy that sacrificed order acceptance for a low fraud rate
- Solution: Cybersource Managed Risk Services for insights into their fraud challenges, and Cybersource Decision Manager to automate fraud detection and make it faster and more accurate
- Business value:
- Boosted order acceptance rate from less than 60% to over 80% while maintaining a low fraud rate of below 0.2%
- Increased payment volume by more than 20%
- Received the National Enterprise Innovation Award First Prize for their fraud solution
- Gained a better understanding of fraud management to help grow their business
China Eastern needed to minimize fraudulent transactions without raising the reject rate so that payment volumes—and profits—could be increased. It worked together with Cybersource Managed Risk Services team to better understand its fraud challenges, and implement a new fraud strategy.
“We learned that having a low fraud rate isn‘t always an accurate indication of successful fraud management. On the contrary, it might mean that good orders and genuine customers are being turned away. Hence it is important to assess a strategy not only by its fraud rate, but also by its order rejection and false positive rate,” said a China Eastern spokesperson.
The airline also rolled out Cybersource Decision Manager across its entire online platform for cross-border transactions to automate fraud detection and make it faster and more accurate.
Boost order acceptance for cross-border transactions
Within three months of implementing Cybersource solutions, the airline saw dramatic improvements to its fraud control and bottom line.
By comparing insights from billions of global transactions and hundreds real-time correlation tests, Decision Manager allowed China Eastern to automate and accurately evaluate orders rapidly. This helped the acceptance rate soar from less than 60% to over 80%, while still maintaining a low fraud rate of below 0.2%. As a result, China Eastern enjoyed over 20% increase in payment volumes from international sales.
Increase in staff productivity
Through Managed Risk Services, the airline was able to outsource its entire fraud operations—which include automated screening and manual reviews—to a team that delivers the round-the-clock monitoring and fraud expertise it previously lacked. This significantly boosted staff productivity. Staff are now able to devote their time to more business-centric tasks that contribute directly to revenue growth. At the same time, customers now have a secure and frictionless buying experience.
In 2019, China Eastern's fraud management solution received the National Enterprise Innovation Award First Prize, a prestigious honor co-sponsored by three major Chinese governing bodies. China Eastern was the only project in the civil aviation industry to advance to the final evaluation stage. Built using key inputs from Decision Manager, their fraud solution received praise for striking the right balance between improving customer experience and enhancing security. In addition, their efforts were recognized for opening international sales channels for Chinese airlines.
Map fraud management to business growth
With a deeper knowledge in fraud management, China Eastern has put in place a holistic fraud management strategy that balances fraud control and order acceptance. This enabled the airline to reach its business goals of reducing operating costs, maximizing revenue and enhancing the customer experience.
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