The rookie mistakes making it harder for merchants to fight back against chargebacks

Michael Mallon

Nov 22, 2021

This article summarizes information and findings from the Accertify-sponsored Javelin merchant survey and report, “Merchant Chargebacks: Building Brand Value by Optimizing Efficiencies.1

According to a recent Javelin survey1, many merchants feel at a disadvantage with the current chargeback and dispute processes. The survey also indicated chargebacks are increasing faster than win rates, and many feel they are fighting a losing battle. While some of the pandemic-related resolution processes can still be improved, merchants will need to adopt better strategies and implement superior tools to get ahead of this uphill battle.

The Javelin survey1 gathered responses from 500 large and small, online and in-store merchants. The results show that chargebacks are costing merchants in lost time and revenue.

The chargeback management experts at Accertify analyzed the merchant responses. This article provides important guidance on how to mitigate risk and implement more reliable processes to manage these increased disputes.

51% of Online Retailers Report That Chargeback Volumes Are Increasing

In the Javelin survey1, 51% of online retailers reported an increased volume of chargebacks, however only 49% report an increase in win-rates. This means that chargebacks are increasing but merchants don’t have the tools and insights needed to increase their win rates.

There are two main problems that are potentially to blame for merchants struggling to respond to and win chargebacks:

A surprising number of merchants shy away from fighting chargebacks. Of surveyed merchants, 46% report1 that they are unable to interpret chargeback guidelines, which they perceive as being complicated and ever-changing and may end up costing them in lost revenue

Merchants feel defeated by their lack of understanding and assume they have no chance of winning disputes.  In fact, survey results[2] highlight these two important trends about merchant assumptions and confidence when it comes to winning chargebacks:

  • 43% of merchants assume they have no chance of winning a dispute
  • 34% of merchants lack confidence that they will win a dispute

Strained budgets and insufficient staff only exacerbate these issues, making it even more difficult to find the time and resources to respond to chargebacks.

Merchants do not have to be resigned to major losses from chargebacks. Instead, they can implement consistent, reliable strategies to protect their business.

Combat Chargebacks: Two Tactics to Recover Loss

While merchants reported these two distinct challenges to fighting chargebacks, both are easily overcome.

Enlist Chargeback Experts Who Understand the Rules

Nearly half of surveyed merchants find chargeback guidelines confusing and frustrating. This lack of understanding is solved by enlisting the help of trusted experts, like our team at Accertify. Partnering with people who understand chargeback rules and guidelines, and which cases are winnable, makes it easier for merchants to navigate this terrain. For most merchants, it is important to invest in a chargeback management provider.

Create Better Processes to Increase Chargeback Wins

Whether or not to respond to a chargeback can paralyze many merchants. As many merchants’ volumes have grown drastically in the past year, it is not surprising they are seeing an increase in chargebacks. However, this problem will not go away if merchants ignore it. Instead, it is critical to take proactive steps to determine which chargebacks are not only winnable, but worth the effort to respond. For example, determining a minimum threshold can be very valuable. For example, chargebacks under a certain dollar amount may not be worth the time and effort to contest. Likewise, knowing that without certain compelling evidence, it is nearly impossible to win a chargeback is advantageous. So responding to those with the necessary documentation is important as well. Merchants should also use all available tools to help when responding to chargebacks such as templates that streamline the process, data collection workflows and more, which can substantially cut down on the manual efforts necessary.

Accertify Chargeback Management: Helping merchants avoid, assemble, analyze and adapt.

Many merchants do not have the resources or knowledge necessary to become chargeback and dispute experts. Partnering with a proven solution provider is the perfect alternative. As merchants, especially online retailers, continue to see increased volumes this may not only be a good idea, but a necessity to stay ahead of increased chargebacks and constantly changing rules and regulations.

 

Accertify Chargeback Management helps merchants:

Avoid

With dispute deflection, real-time responses and chargeback alerts (and more!) Accertify can help merchants stop chargebacks before they occur.

Assemble

With over 40+ integrations to processors across the globe and a library of pre-built dispute templates, Accertify Chargeback Management can help automate the response process and significantly reduce the manual effort required.

Analyze

Chargebacks can be a symptom of a larger problem. Our chargeback experts can help merchants understand if there are operational processes or fulfillment issues that are to blame for increased chargebacks. Additionally, integrating valuable chargeback data into your fraud prevention application can further help provide critical feedback loops and mitigate fraud at the time of payment.

Adapt

With network policies and regulations changing twice a year, with fraud attacks constantly morphing, and supply chain and fulfillment impacted by COVID-19, it is critical to have a platform that can quickly adapt and manage change.

While no chargeback management solution can eliminate chargebacks entirely, our expertise can help merchants win more chargebacks, prevent revenue loss and increase efficiencies.   

Accertify’s comprehensive chargeback management platform is powered by industry experts and uniquely equipped to help merchants fight chargebacks and increase their win rates.  

Request a consultation about Accertify Chargeback Management.

1 Javelin Survey 2021 – Merchant Chargebacks: Building Brand Value by Optimizing Efficiencies

2 Javelin Survey 2015 – Merchant Chargebacks: Building Brand Value by Optimizing Efficiencies