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Reducing Chargebacks

Reducing Chargebacks

December 1, 2008
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" When a customer contacts you ... you have an opportunity "

Recently, XBIZ World Magazine asked several industry players "What are your favorite chargeback reduction techniques?"

Here's what they had to say:

When a customer contacts you, the most important thing to remember is that you have an opportunity — one that you may not have had if the customer called the bank instead. The card association rules are in favor of the customer, so ultimately they can initiate a chargeback, get their money, and cause you to need to make 100 sales to make up for the one chargeback (depending on your volume). So, being friendly to your customer and understanding their concerns is important. Perhaps simply reminding them what the charge is for in a discretionary way is enough to resolve the matter. Or, offering them something free or at a reduced cost instead of a refund is sometimes a satisfactory resolution. Chances are the tone of your conversation will have a lot to do with the outcome. Using an experienced third party billing company with a 24 hour support center is an excellent way to go as well.

— Rand, Epoch.com

At MaxCash we believe a lot of it has to do with attitude: Companies that treat their customers as valuable clients are a lot less likely to face chargebacks than companies who mistakenly think of them as idiot surfers.

— SPANNOW, MaxCash.com

The best way to reduce chargebacks is to give the members what they want: fresh content updated constantly — pure and simple.

— Shok, CreamBling.com

We offer members a very detailed support section where they can find answers to frequently asked questions, report a bad link, download the latest versions of various media players, access cancellation pages for all billers and give a support email that we answer within 24 hours.

— Kenny B, IACash.com

Most chargebacks occur when customers are mislead or annoyed when an issue can't be fixed in a timely manner. We make sure to give our consumers easy access to get any issue that they have resolved within 24 hours. A 24/7 call center, support emails with a response time of less than 60 minutes and an easy, foolproof cancellation application all play a major roll in getting our chargebacks to a very manageable number.

— Billy, PaperStreet.com

Provide easy member's area navigation and don't put photos or videos on your tour that are not in your member's area. Offer enough of the content that is in your niche to keep member retention high — some sites only offer 20 sets of content for a particular niche, with no updates.

— LotzaEd, LotzaDollars.com

The best way to reduce chargebacks is to make every reasonable effort to prevent them from happening in the first place. Much of the advice for preventing chargebacks is pretty basic, really: don't advertise services or content that you don't offer; don't make exaggerated claims about your website that will lead to disappointment among your users; and generally avoid misrepresenting your product. Providing effective and responsive customer service is important, too. Customers don't necessarily expect that their issues will be resolved immediately, but they do expect a timely response and indications that the merchant cares about keeping them as a customer.

— Q Boyer, TopBucks.com

From the surfers who contact me through my review sites, it seems that the best method of chargeback reduction is having an honest tour that explains what the membership gets them in detail. Sites like VideosZ.com and the bondage sites owned by Kink.com actually have 'transparent tours' that let a potential customer see the entire member's area before buying a membership; and that does a lot of good in reducing chargeback ratios — as opposed to tours that mislead or misinform potential customers.

— Stewart, WebmasterScore.com


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