Making Your Chargeback Data Work For You

Making Your Chargeback Data Work For You

Your business and, frankly, your livelihood depends on data. You’re tracking your sales numbers, your fixed and variable costs, the number of active employees you have, the amount of time your customer service team spends on calls, and how long it takes to get a new product to market. These are all facts and figures that you cannot afford to ignore. So, why are you taking a hands-off approach to your chargeback data?

Your chargeback data and what you do with it has just as much measurable impact (and possibly more) as your sales data. You can have the highest sales in your industry, but if your chargeback ratio is too high, you’ll have trouble succeeding. You can’t ignore your chargeback data and hope everything works out for the best.

What Is Chargeback Data?

When we talk about data, we’re not just talking about numbers. Chargeback data includes the following key business markers:

• Chargeback type:  It’s important to know what types of chargebacks you’re seeing and to track the reason codes. Knowing this information can highlight holes in your business processes. For example, you could be missing key data on your website about your refund/return policy or a high number of mobile purchases that are resulting in increased chargebacks.

• Representment decisions:  Do you automatically choose to represent every chargeback, or do you do the opposite and never choose to represent? How do you decide when to proceed with a representment? What is your representment success rate? Remember, representment can be a good thing—when you do it at the right time with the compelling evidence that allows you to win your dispute.

• Buying history:  Understand where your customers are coming from. Knowing how your customers are finding your product, where they’re doing their research (online, in-store, or some combination), how they ultimately purchase your product (mobile, website, in-store, phone), and how they receive your product. Once you have this information, you can improve your marketing and sales strategy to reach your target demographic, and you can learn where you need to focusmore attention on strengthening your fraud strategies.

• Customer facts:  Who is buying? Who isn’t buying but is spending lots of time researching your products? Who is returning your products and not filing a chargeback? Who is filing chargebacks, and why are they filing these chargebacks? How are your customers interacting with you? Who is working with your customer service team? How satisfied are your customers and where are they posting reviews and feedback?

• Chargeback ratio:  This is the big one that most people think of first when we discuss chargeback data. Your chargeback ratio is vitally important, and can have a significant impact on the success of your business . But simply knowing your chargeback ratio is not enough. The chargeback ratio does not give you the entire picture of your business and how it is operating.

Your chargeback data paints a clear picture of what your business is and isn’t doing. Each component in this data pool is important and can highlight how and where you’re succeeding and where you have room for improvement.

Learning What To Do With Chargeback Data

The challenge lies in learning and knowing what to do with this chargeback data. You might be able to tell us your chargeback ratio, but what does it tell you about your business and how you need to make changes? The same holds true, for example, in knowing that most of your sales are coming from mobile—but how does this impact your fraud prevention or customer service approach?

If you know the bulk of your chargebacks are associated with problems regarding your return/refund policy, then you need to take steps to improve your website, change your billing descriptors, update the details on customer receipts, strengthen your customer service team, and review the entire sales process.

You’re not alone in not knowing what to do. A recent Worldpay study titled Fraud Trends 2016 highlights that most merchants are overwhelmed by the amount of data they have and aren’t sure what they should be doing with it. Couple this with uncertainty in how to handle the proliferation of mobile sales and how to better harness social media to prevent fraud, and most merchants are still merely are on the cusp of learning how to harness the power of chargeback data.

Data is power—but what to do with this data is the big question. You can ignore it at your peril or you can work with chargeback data experts to help you understand what your data is telling you. You might not like what your data is showing you, but once you understand how to use chargeback data to strengthen your business, the stress of chargebacks and your chargeback ratio will be significantly diminished.

The data is sitting there waiting for you—what you do with it is up to you. Know that we’re here to help and provide you with the solution you need to get your chargeback data working for you rather than against you. We urge you to read the Worldpay study and learn more about the future of fraud.