A guest post by: J. Ruzicka, Certified eCommerce Fraud Professional
When reconciling your past chargebacks it is important to categorize your chargebacks into appropriate categories. I like to use two buckets, fraud and customer service. Today I will focus on avoiding customer service chargebacks for a small to mid-sized merchant.
As a fraud professional I think the most avoidable chargebacks are customer service driven chargebacks. The merchant should be doing several things to ensure the customer will not need to call their issuing bank to file a does not recognize, services not provided, cancelled recurring transactions, duplicate processing, merchandise or non-receipt chargeback. Today, I would like to show the steps that I consider important that you use to reduce these chargebacks.
The very first step to avoid these types of chargebacks is to properly setup your credit card descriptor with your processor. The descriptor should be a link back to your website and include a toll free phone number (even though most consumers will be calling with cellular phones the toll free number studies show a toll free number will help provide credibility to your online business and provide a more professional look and feel for your customers).
Website layout is the next important step to take to avoid these chargebacks. Your website should include easy to read terms and conditions, return policies and provide your toll free phone number in an easy to find location for your customer. You can also have other means of customer service included in your website. These can include email addresses, mail location, online forms to contact us and a live chat. If you have multiple websites consider creating your “family of brands” in a logo at the top of each page. If you are processing into the same account for each of your websites this will help tie your descriptor nicely back to your sites. An example of multi branding is gap.com. Whether you are on Old Navy, Banana Republic or Gap.com you see the family of brands on each page. If you have a store location(s) this will also help provide credibility to your site and should be included on your website.
After completion of purchase it is important to immediately send a confirmation of payment / receipt. A second email should be followed that will include tracking information. On both emails you should include your customer service contact information and hours of customer service availability. If you do not have 24×7 customer service, allow for a customer to leave a voicemail but be certain that you provide realistic response times in your message. If you say that you will be calling back the next day and are unable to, the customer will call their card issuer.
If the customer calls to report damaged, non-receipt or other issues with the merchandise it is important to track these calls under the customer’s profile index on your back-end system. If the issue cannot be resolved and you believe the customer might file a chargeback it might be in your best interest to offer a replacement or free return shipping or an RMA (return package by a merchant assigned tag) to get the merchandise back (depending on the product, it’s value and your past history with the customer).
If a customer service related chargeback comes in you will have documents to represent the chargeback. Depending on the reason code the buyer filed under it will give you an understanding to what is needed to assist in representing the chargeback.