Prevent the Pain
Why is it important to reduce or eliminate chargebacks? Because they are costly, create higher fees for you, and your merchant account can eventually be canceled altogether. Not an ideal situation for a growing small business to be in. Better to be proactive than reactive. Also realize that proof falls on the shoulders of the business, guilty until proven innocent.
So, what can be done to prevent a chargeback from occurring? Make sure your domain name and your toll-free number appear on their credit card statement. Often, the official company name does not match the domain name and thus customers do not recognize the charge. When this happens, the easiest thing for them to do is call the credit card company and complain about a fraudulent charge. Make it easy for them to call you and get a clear answer on the charge. This will save you both money and headaches.
You can certainly mention the real company name during the checkout process and in order confirmation emails but don’t expect customers to see it. People don’t read stuff like this, they only skim for what they want to see. If your market is high dollar or has repeat charges (consulting), you may need to consider getting a signature. From a fraud prevention perspective, it may be worth looking into IP checking, reviewing large/strange orders, blocking certain countries, using merchant account fraud prevention tools, or working with outside fraud prevention companies.
Your customer service policies will certainly make a big difference. Be sure to include a toll-free phone number on your websites and products. Consider having a liberal return policy and instead of fighting it, just eat it and move on. Besides providing a good value product, consider including additional unannounced bonuses arriving over time (preferably over a month or two), helping them consume the material, and extending the refund time period.
Some customers will try to pull a fast one and say they never received the merchandise. If this becomes a big enough problem, you may be forced to resort to proof of delivery signatures and waivers. Sometimes, for various reasons, we decide we must fight back. Would you like a really great technique to make this easier?
Call the person directly and tell them you are from the collection department of [your company name]. Tell them you realize there is probably just a misunderstanding and that you would like to get this taken care of ASAP. Explain the charge to them and tell them that most people own up to their responsibilities. Ask them to sign a form you will send to them stating that they accept the charge. Ask them to call their credit card company and tell them, too.
The best thing you can possibly do is treat people fairly and with integrity. This simple step can eliminate a significant amount of the potential chargebacks.
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