Make Returns Easier, Avoid Disputes

Sydney VaccaroPhysical GoodsLeave a Comment

Make Returns Easier, Avoid Disputes
It is important to take into consideration the customer experience when making a return, not only for customer loyalty but to avoid disputes as well.

Of course, every customer wants an easy and carefree return policy. But it is easier said than done for merchants. Merchants, especially ecommerce merchants, have a lot on their plate already when it comes to just the logistics of returns. But it is important to take into consideration the customer experience when making a return, not only for customer loyalty but to avoid disputes as well.

What is Chargeback Fraud?

Chargeback fraud is when a cardholder fraudulently disputes a charge in an attempt to gain the money from the transaction back while still retaining the merchandise or services. They are taking advantage of the dispute process.

There are plenty of motivators for chargeback fraud. These can range from buyer’s remorse, lack of customer service, or a strict return policy. Any inconvenience or problem that may make a customer turn to their bank to resolve the issue, instead of the merchant, can be a cause of chargeback fraud.

How to Make Returns Easy

The goal for merchants should be to avoid disputes. Even if the merchant puts together a winning response document and the transaction amount is returned to them, merchants will still have to pay a fee associated with the dispute. So it is always better to avoid a dispute altogether. Here are a few tips to avoid a frustrated customer trying to get their money back through the dispute process:

Issue Returns Quickly

When a customer goes through the process of returning merchandise, they expect the funds to be returned quickly. If the funds are not returned quickly, the customer may think that you did not issue the return at all, then dispute the transaction. The faster the funds are returned the better.

Note that merchants should never refund a customer once the dispute process has been started. If the customer wins the dispute and the merchant refunds them they will receive the transaction about twice.

Create a Clear Return Policy

Creating a clear return policy is important in many ways. It helps customers understand the return policies before purchasing, it helps regulate returns, and if a dispute comes in it provides needed compelling evidence for a dispute response. Making sure you disclose your return policy to your customer is just as important as having a clear return policy. Don’t make your customers search for it.

The Expectations Are High

For better or worst, customers have become accustomed to two-day shipping and hassle-free returns. Their expectations are high when it comes to convenience. Any return process that takes some work on their end or is anyway a hassle to complete may push them to just dispute the charge instead of go through the return process.

Keep in mind that for most cardholders, disputing a charge is easy. It usually just takes a few clicks or a quick phone call to dispute. The goal for merchants is to make contacting your customer and making a return as easy as contacting the bank.

If You Have to Make it Strict, Let Them Know

Sometimes merchants simply can’t match the absolute hassle-free return because of the industry or type of good they sell. If you are one of these merchants, make sure your return policy is absolutely made clear to the customer before they buy. This makes sure that there are no surprises and the customer doesn’t feel cheated when they have to return the product.

Beyond Preventing Disputes

There are benefits for creating an easy return policy beyond just preventing disputes. A study found that when a firm introduced a really easy, amazing for customers return policy they found it boosted profits in both the short and long run. Profits when up by more than 45 percent per customer, on average, over the six-month window, and by 29 percent at the end of the three-year span.

Introducing fees, restrictions, and strict deadlines into a return policy can make a customer not want to work with the merchant to return the product or just not buy from the merchant all together. Always make sure to keep the customer in mind when creating a return policy.

Of course, every customer wants an easy and carefree return policy. But it is easier said than done for merchants. Merchants, especially ecommerce merchants, have a lot on their plate already when it comes to just the logistics of returns. But it is important to take into consideration the customer experience when making a return, not only for customer loyalty but to avoid disputes as well.

What is Chargeback Fraud?

Chargeback fraud is when a cardholder fraudulently disputes a charge in an attempt to gain the money from the transaction back while still retaining the merchandise or services. They are taking advantage of the dispute process.

There are plenty of motivators for chargeback fraud. These can range from buyer’s remorse, lack of customer service, or a strict return policy. Any inconvenience or problem that may make a customer turn to their bank to resolve the issue, instead of the merchant, can be a cause of chargeback fraud.

How to Make Returns Easy

The goal for merchants should be to avoid disputes. Even if the merchant puts together a winning response document and the transaction amount is returned to them, merchants will still have to pay a fee associated with the dispute. So it is always better to avoid a dispute altogether. Here are a few tips to avoid a frustrated customer trying to get their money back through the dispute process:

Issue Returns Quickly

When a customer goes through the process of returning merchandise, they expect the funds to be returned quickly. If the funds are not returned quickly, the customer may think that you did not issue the return at all, then dispute the transaction. The faster the funds are returned the better.

Note that merchants should never refund a customer once the dispute process has been started. If the customer wins the dispute and the merchant refunds them they will receive the transaction about twice.

Create a Clear Return Policy

Creating a clear return policy is important in many ways. It helps customers understand the return policies before purchasing, it helps regulate returns, and if a dispute comes in it provides needed compelling evidence for a dispute response. Making sure you disclose your return policy to your customer is just as important as having a clear return policy. Don’t make your customers search for it.

The Expectations Are High

For better or worst, customers have become accustomed to two-day shipping and hassle-free returns. Their expectations are high when it comes to convenience. Any return process that takes some work on their end or is anyway a hassle to complete may push them to just dispute the charge instead of go through the return process.

Keep in mind that for most cardholders, disputing a charge is easy. It usually just takes a few clicks or a quick phone call to dispute. The goal for merchants is to make contacting your customer and making a return as easy as contacting the bank.

If You Have to Make it Strict, Let Them Know

Sometimes merchants simply can’t match the absolute hassle-free return because of the industry or type of good they sell. If you are one of these merchants, make sure your return policy is absolutely made clear to the customer before they buy. This makes sure that there are no surprises and the customer doesn’t feel cheated when they have to return the product.

Beyond Preventing Disputes

There are benefits for creating an easy return policy beyond just preventing disputes. A study found that when a firm introduced a really easy, amazing for customers return policy they found it boosted profits in both the short and long run. Profits when up by more than 45 percent per customer, on average, over the six-month window, and by 29 percent at the end of the three-year span.

Introducing fees, restrictions, and strict deadlines into a return policy can make a customer not want to work with the merchant to return the product or just not buy from the merchant all together. Always make sure to keep the customer in mind when creating a return policy.

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