How Ghost Orders Are Costing Food Delivery Businesses Millions

Ghost orders can significantly impact food delivery businesses by causing financial losses through fraudulent practices. Fraudsters create fake orders that appear to be legitimate but are never fulfilled.

Here’s how it typically works:

• App Cloners: Fraudsters clone food delivery apps to manipulate the system.
• Fake Accounts: They generate thousands of fake user and driver accounts, often controlled from the same device.
• Automated Orders: They rapidly accept multiple orders using tools like auto clickers.
• Delivery Simulation: They falsely mark the orders as delivered by using GPS spoofers.
• Incentives Claim: They then claim incentives based on these fake completed orders.

This manipulation not only leads to financial losses but also damages the platform’s reputation and compromises genuine customer experience.

Fraud in the food delivery app business is a serious concern for merchants worldwide.

Fraudsters love the taste of food delivery accounts, with approximately 57%-60% of food delivery merchants considering account takeovers one of their top fraud risks.

Here is a list of major fraud in the food delivery business.

Common Types of Fraud in the Food Delivery Business

User/Customer Side Fraud:

• Account Takeover
• Promo Abuse
• Friendly Fraud

Driver/Rider Side Fraud:

• Account Sharing
• Location Spoofing
• Promo/Incentive Abuse
• Automated Order Acceptance
• Ghost Orders

Fraud in the food delivery business (especially Account Takeovers) could be deadly for the industry if left unchecked. Food delivery businesses must always implement proactive fraud detection measures, including device fingerprinting, behavioral biometrics, and device location attributes.