Chargeback Prevention Strategies
Some chargebacks may be unavoidable. However, a merchant does not have to simply sit on the sidelines. A plan designed to prevent chargebacks at every available opportunity can help significantly reduce the negative impact chargebacks have on a business.
There are readily available prevention methods currently in place proven to help merchants. Card network tools such as security codes (CVV), Address Verification Service (AVS), 32D Secure 2.0 (3DS2), and Visa Account Updater (VAU) are all methods of validating a shopper’s identity. Using multiple tools together can increase the accuracy of transactions.
Additional resources include chargeback alert programs. These aid merchants by providing advance notice of disputed transactions to clear up any customer confusion over a transaction and prevent fraud.
Outstanding customer service is an effective way to reduce the number of chargebacks. One key is ensuring the customer service process be easier than calling a bank and requesting a chargeback. A helpful customer service staff that provides timely support before, during, and after a sale will ensure that less mistakes and missteps occur within the order process.
A merchant should prominently display the customer service contact phone numbers and email addresses on the website pages, order blanks, receipts, packaging, and more. Time is a key component of the customer service experience. Live representatives should answer phone calls and emails as quickly as possible to address the issues and concerns of the customer.
Communication is Key.
Through the order process, all the way from a customer checkout through the delivery of the order, the more communication the better. This will make the customer more confident in their purchase and will allow you to hear any customer concerns and provide solutions.
Provide delivery dates, package tracking, order status, and shipping insurance to set expectations and provide transparency. Updates at key points during the shipping process give customers realistic estimations of when a product will arrive and ensures them their order is being fulfilled. Along with this, monitoring the day-to-day process will help ensure merchant error in the ordering or fulfillment aspects of the business is minimized.
Clarity in your marketing can also help eliminate chargebacks by providing honest clear descriptions of the product or service. Avoid being vague when marketing the product or service so as not to misrepresent the product. Providing accurate pictures and descriptions ensures the customer is well aware of what they are receiving, and feels the merchant is trustworthy.
The payment descriptor is how your business is listed on a credit card or bank statement. If your products are more familiar than your doing business as (DBA) name, customers may not recognize their transactions with you. Having an accurate descriptor that appears on their card statement will ensure that they do not accidentally chargeback because they don’t know what the charge was for.
When it comes to chargebacks, being proactive in all aspects of your business is a key to success. By using the tools and practices listed above, you can drastically improve the performance of your business, and reduce the headaches chargebacks bring.