Tag Archives: merchants

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Myths About the Safety of Contactless Payments

Even though card payment is still a popular method of payment, more and more people are now switching to contactless payments especially after the COVID outbreak. It’s obvious that people want to prioritize their safety by limiting physical contacts, and one way to reduce the physical contacts at the retail stores is by paying through e-wallets. 

With more than 90% of the transactions being processed through contactless payment methods, Australia has become a leader in accepting this mobile payment trend. Not only in the US and Australia, but mobile payments are gaining attention worldwide, and for good reasons. 

Despite their popularity, contactless payments are associated with a few myths that make people wonder if they should embrace this new technology or stick to cash and card payments. We have listed a few myths surrounding contactless payments that every user should know before they start using mobile apps for transactions. Here’s a look:

  1. Electronic Pickpocketing is Possible

Let’s start with the most common myth. Some people believe that it’s possible to pickpocket your contactless payment data. All it takes for a person to steal your private information is the NFC card. If they are standing close to you with an NFC card, they can record your card’s details. The NFC card can read your account number and the expiry date, but that’s it! Even that is possible if the person manages to steal the POS terminal, which is practically not possible for any non-tech savvy person. 

Overall, there is a higher chance of your physical credit/debit cards getting stolen in a public place than your contactless card information getting leaked. So, you can rest easy knowing that it is just a myth and there’s no way anyone can pickpocket your contactless cards electronically.

  1. You Might End up Paying for Someone Else

First things first, the POS system can catch your card’s data only when the card is placed 1-2 inches from the terminal. So, if you are worried that the point of sale terminal will use your card’s information for somebody else’s purchases, know that it’s highly unlikely. Besides, you should maintain distance from the person and the terminal until it is your turn to pay.

  1. It is not a Convenient Option for Merchants

Embracing a new technology may seem daunting at first, but once you get used to contactless payments, there is no payment method that seems more comfortable and safer than these payments. Contactless payments are convenient for both customers and merchants. It’s a lot easier for customers to make the payment in one click. Imagine not having to carry cash every time you go shopping. All you need is a mobile app to transfer money to the merchant’s account. 

For merchants, there is no need to count cash and store the money in the drawer. At the end of the day, you have to count the total cash and match it with your records. Besides, you need to transport this money to your bank every day. Not only is the process pretty inconvenient, but it is risky. What if an intruder gets access to the cash? Stealing money is not uncommon at brick-and-mortar stores. So, to avoid such issues, you should use contactless payments. The money goes directly to your bank account.

  1. The Thief can Duplicate the Contactless Cards

If a thief gets access to your contactless card information, there is a risk they can duplicate your card. It is another common myth that stops people from accepting and making payments through mobile apps. When you initiate the transaction, the card sends a unique code to the card reader to process the transaction. 

It is only a one-time number that can neither be stolen nor be copied. Even if the thief gets access to your contactless card details, they cannot duplicate the card due to the one-time code technology. There is absolutely nothing to worry about your card getting duplicated. Even a professional hacker or a tech-savvy person cannot duplicate a contactless card.

  1. Stolen Contactless Cards can Cause Losses

We have already mentioned that it’s not possible to steal contactless card information. Let’s say someone gets access to this data somehow. Now, the common myth is that the thief can make multiple transactions using the stolen card information and the money will be deducted from the cardholder’s account. For some reason, people also believe that the thief will be able to use the stolen contactless card to make payments without having to enter the security PIN.

Even if your contactless card gets stolen and you suspect any fraudulent activities on your cards, you have to report them to the bank just like how you would report the fraudulent transactions with your physical card. Besides, you don’t have to worry about incurring major losses, as contactless payments have the same policies as any physical card. You will get total reimbursement for all the transactions made by the thief. Another important thing to note here is that a PIN is mandatory for all types of contactless card transactions. Even if you are buying groceries, you need to enter a PIN to process the transaction. 

  1. The Contactless Cards can Get Stolen if Someone Gets Access to My Device

Another major concern of contactless card users is “can someone get access to my card details if they steal the device connected to these cards”. Let’s face the reality – if a thief were to get access to your device, it wouldn’t be hard for them to find your contactless card information. However, contactless commerce is a lot safer than you can imagine. The card number is not visible. The hidden number has to be deciphered by the issuer to process any transaction. 

Conclusion

Not only are the e-wallets convenient and fast, but they allow people to make the payment in one click without having to swipe the card. These contactless payments make an ideal choice for customers and merchants looking for easy and safe ways to make payments.

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10 Things To Know Before Selling on eBay

Everyone sells their products on eBay, from giant corporations to small businesses. Selling on eBay can be exciting, but it can also be quite intimidating if you’re starting and don’t know the first thing about the website or how to make your products pop. That’s why we bring you the ten most well-kept secrets that sellers on eBay hold dear to sell their products and make them pop! Make sure to follow these tips closely if you want to become a top seller and make it big!

Without further ado, here are the top 10 things you should know before selling on eBay. 

  1. Get Inside The Mind Of A Customer

If you want to sell, you need to think not like a seller but as a buyer. Pretend you’re a customer thinking of buying the kind of products you sell. Go on the website as a casual shopper and see which products are already listed. Once you’re there, you can begin noticing patterns: which sellers have the most enticing photos? What makes them incite? What’s the average price at which your products are sold on eBay? 

By knowing these critical pieces of information, you can make your listings as enticing as possible to potential consumers, as you know what they like and what drives them to make the purchase.

  1. Know Your Enemy As You Know Yourself

This is an adage that remains to be true. eBay is a very competitive platform since there are so many people on it. If you want to be a top competitor, you need to know how your adversaries think. 

Use the top-selling feature to see which products pop off on eBay. Also, study the product listings and take notes on what you think makes them so marketable. Do they name their products something in particular? What kind of photos do they use? What are their product descriptions like? These are the key aspects you need to know to be a top seller on eBay. 

  1. Know Your Fees

eBay itself isn’t exactly free. If you’re not into the whole auction thing but still want to sell on eBay, you’re going to have to pay some fees. eBay offers a variety of subscription packages, including:

  • Starter
  • Basic
  • Premium
  • Anchor
  • Enterprise

The monthly subscription fee depends on your subscription plan, so look for the one that’s right for you and make it easier for your customers to buy your products!

  1. Know-How To Price Your Items

This is yet another crucial feature to keep in mind if you want to remain competitive on eBay. Whether it’s kitchen appliances or Cheetos shaped like Jesus, no matter what you’re selling, there’s a high chance someone is selling the same thing at a lower price with better production photos. 

This is why it’s vital for you as a buyer to track what your competitors are selling their products for and work in that price range, so you genuinely have a fighting chance. You can also offer lower prices to make your products more enticing to potential buyers.

  1. Get The Perfect Shot To Sell Your Product!

Humans are visual creatures; this is why production photos are everything. Getting good shots of your product with a cohesive composition and lighting can be the difference between selling your product for $300 instead of $3. 

But how can you achieve those great product shots you see everywhere? Well, one way is to make your DIY lightroom. This kind of thing can be made with cardboard, paper, and glue, but it has the same effects as a professional photoshoot! 

  1. Write Product Descriptions Like You’re Writing Poetry

Images aren’t the only thing you can improve about your listing. Writing good product descriptions can also be the factor that either attracts customers or makes them walk away.  Here are some tips you can follow to write the best product descriptions:

  • Keep it short, sweet, and skimmable.
  • Please don’t use other people’s descriptions; make them unique.
  • Break up your text using bullet points, lists, numbers, and short sentences.
  • Triple-check your spelling so you don’t sound like you’re trying to scam people.
  • Give as much detail as possible.
  • Write enticing headings.
  1. Be Open To Constructive Criticism

Feedback isn’t only good for you, but it’s also good for your business. If buyers go to your listings and don’t see any product reviews, then they might get scared off by the fact that no one can vouch for your products. This is why it’s essential to get your products out there and encourage people to leave reviews so that other potential buyers know you’re legit.

  1. Promote, promote, promote!

This one is a no-brainer; no surprise there. If you want to sell, then you need to promote your products with everything you’re eCommerce business has to offer. Here are some tips on how to do that:

  • Social Media: buy ads on Instagram, Twitter, and every platform you can think of. These ads will get people to your store.
  • Promotion Boxes: eBay allows you to promote your products within listings, make sure to use it to remain competitive.
  • Content Marketing: advertising your products on a content platform such as a blog or YouTube channel can surely make you go far.
  1. Sell in Cycles

As you track your competitor’s listings, you’ll probably be able to tell that their prices don’t remain the same for long. On specific dates, they peak, and on others, they get lower. Make sure to follow these patterns so you can remain competitive!

  1. Look At The Big Picture

Becoming a top-seller doesn’t happen overnight; it’s a process. This is why you need to sort both short-term and long-term goals for yourself, so you can stay on track and remember that when things get tough, it’s okay; they’re supposed to get tough at some points. Just keep your chin up and keep trying! Success isn’t always gifted; it’s earned. 

Conclusion

Now you know everything you need to know before selling on eBay!

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Best Practices For eCommerce Merchants Selling on Shopping Engines

These days, everyone is selling their stuff online, from fashion giants like Zara and H&M to small, hand-made businesses with few employees. If you’re the latter, then you know that getting your products out there can be tricky. Sometimes ad campaigns and word of mouth are not enough, and when those bills come in the mail, your heart starts racing as you wonder if you’re going to be the next ones to close up shop and hitch a tent in the park. 

Well, we have the solution. It’s called a Comparison Shopping Engine, and while it may sound weird and unfamiliar right now, you’ll probably get the hang of it in minutes.

Let’s get into what Comparison Shopping Engines are and how you can use them to generate more revenue, so you don’t have to eat out of cans for the rest of your life.

What Are Comparison Shopping Engines?

This is a great question to start with. Just what are these futuristic-sounding engines? Are they like car engines with physical parts? Do they require fuel? Well, the good news is that they don’t! You’ve probably heard of the term ‘search engine’ before being used to describe websites like Google, Bing, etc. These are called ‘search engines’ because they’re like giant digital machines people search for information. 

Comparison Shopping Engines are a lot like that, except buyers use them to search products and compare everything from shipping costs to prices instead of just searching for any information. 

Comparison Shopping Engines are every buyer’s secret weapon since they typically use them to get the best deals on products by looking at what multiple places are selling that product for, how much the shipping costs, etc. 

Why Should You Be On Them?

Well, this is a simple question to answer. Just like companies pay Google to show the links to their websites at the very top of the results page, you too can use Comparison Shopping Engines to get your products in front of more people.

In addition, people who use Comparison Shopping Websites are the best customers you can hope to find since they want to buy that product and they’re by far the most likely to complete the purchase during their visit. Comparison Shopping Websites are also the first to show up on Google’s result page so that you can gain a lot from their visibility.

If your products show up on these websites, then you’re pretty much guaranteed more traction to your online store, especially since it helps to build trust between you and the customers. When people see your products on Comparison Shopping Engines, they’ll know that you offer good deals and will be more likely to want to do business with you in the future.

Choosing The Right One

With so many different Comparison Shopping Engines to choose from, how are you supposed to know which one is best for your business? Well, there are some factors to consider. For starters, you need to know which Comparison websites your competitors are on. This comes with advantages and drawbacks. 

The advantage is that people who visit that particular engine are more likely to search for the types of products you sell. This is because all the traffic for that kind of product is going there. The disadvantage is that since all of your competitors are on that particular engine, you may have trouble standing out and might have to lower your prices to compete. 

Another option is to use a Comparison Shopping Engine that none of your other competitors have even heard of. You may get less traffic, but you’ll also probably make more sales since you appear to be the only one offering the kind of product that your customers desire. 

Top 3 Comparison Shopping Websites

Alright, now that you know what Comparison Shopping Engines are, let’s dive into some of the best of them so that you too can compare and contrast which one is best for your business.

  1. Google Shopping

Google Shopping is probably the most popular Comparison Shopping Engine out there. Since it’s built right into the Google platform, it’s very easy to find, and it probably offers the most visibility out of all of them since it showcases links to products at the very top of their results page when people search for them. If you want to get as much exposure as possible, Google Shopping is a fantastic choice.

  1. NexTag

NexTag is a veteran in the Comparison Shopping Engine world, established back in 1999 when you used to spend your days watching Saved By The Bell, collecting pogs, and wearing neon hoop earrings. Millions of people use the website every day, and it’s also probably the most versatile when it comes to products since you can list real estate, concert tickets, travel, and much more.

  1. PriceGrabber

PriceGrabber is a great choice both for buyers and sellers alike. In addition to having features of any other shopping comparison website, it also has features for buyers! With its easy-to-use Market Report, you can track purchases and monitor pricing trends so you can stay on top of your game.

But How Do You Get On Them? 

There’s the big question: all these websites may sound fantastic, but how are you supposed to get your products on them? Well, the first step is to get your products listed on them. You can do this easily by filling out the search engine’s CSV (Comma-Separated-Value), which is a bunch of information they need to list your product according to their format. 

This information includes product title, price, description, and image location. The website will then use this information to get you listed on their websites and put you in front of potential buyers!

The Bottom Line

Running a small business can be extremely difficult, but Shopping Engines can get the job done fast and easily. Don’t hesitate! List your products today and get them in front of buyers so that you can continue to grow.

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Shopify vs. Etsy: Which Is Better In 2021?

The Internet has exploded since the days of its conception. Before, computers took up an entire room and had to be run with thousands of buttons and dials. Then, we got a dial-up Internet making strange screeching noises through the phone, and then we got discs. Now navigating the internet has become a lot easier, too. The Internet now offers millions of services, including information, educational resources, tests, quizzes, and ecommerce. The days of camping out outside of stores have long since passed. Now anything you want is just one click away!

Navigating has become a lot easier, too. The Internet now offers millions of services, including information, educational resources, tests, quizzes, and shopping. The days of camping out outside of stores have long since passed. Now anything you want is just one click away!

And not only has it never been easier to buy something, but it’s also never been easier to start a business! Nowadays, anyone can create an account for free and start selling their products, no matter how niche they are!

However, if you’re an online seller, you may be overwhelmed by the number of choices you have at your disposal. Most people have narrowed it down to two main platforms: Shopify or Etsy. But how can you decide which one is best for you? 

That’s precisely what we’re going to figure out on this edition of : Shopify vs. Etsy. 

Overview

Before we get into the actual fight, let’s look at our fighters. In one corner, we have a tech giant that has been on the Internet for about as long as Queen Elizabeth II has been alive, Etsy. Etsy is the online equivale; Ent of a flea market: you can sell just about anything, at any price, and people can even get into bidding wars over your products! 

However, the bad part about Etsy is that it’s hard to develop your brand image there. Because Etsy currently doesn’t offer any ways to make your market store stand out, it can be easy to get lost in the sea of painted spoons. Still, millions of people use Etsy every day, and it is widely successful and reliable. 

And in the other corner, we have Shopify, the young buck who’s threatening to take down Etsy! Shopify has a significant advantage in that it is highly customizable. Platforms can easily use it to create their online stores and build a group of reliable customers to keep them afloat during hard times. 

Let the fight begin!

Anyways, now that you have some background on each of our fighters let’s look at their stats. Let’s see who comes out on top in each category!

Round 1: Ease Of Use

This is a hard one to measure up since both platforms are relatively easy to use. The user interface is intuitive, so it doesn’t take a rocket scientist to buy or sell products on each platform. 

However, Shopify has an advantage in the sense that everything on their website is built in. Because it’s so easy to attract customers, all you have to do is create an attractive website and market it throughout all social media platforms. 

Etsy, on the other hand, takes an entirely different approach to online sales. Instead of redesigning your website in the way that you would your physical shop or boutique, you set up a business in an already existing marketplace, sort of like hitching up a tent at a local flea market. 

This means that setting up when you are brand new is easy. But, sticking out and getting customer retention is hard because everyone is competing in the same marketplace with no options to differentiate themselves and stand out. 

Round 2: Domains And URL

Believe it or not, this is an essential part of growing your online business. Your URL is like your store’s address. It’s how people can find you in the ocean of other internet sites and know who you are and where to buy your products. 

Shopify has this covered by allowing buyers to buy their ion domain name so that they can make it something easy to search. Etsy, however, doesn’t allow for this type of customization, so you run the risk of customers having to paste a very long list each time or having to scroll past hundreds of results before they even get to you. 

Round 3: eCommerce Features

Now, this is the thing every online entrepreneur wants to know about: how easy is it to sell on either one of these platforms? Well, Shopify makes it extremely easy to run a business on their platform by giving you tons of valuable tools. For example, creating unique product pages, figuring out check out experiences that can’t be found anywhere else online, and offering a wide range of payment options so that no customer is left out!

On the other hand, Etsy doesn’t offer as many attractive features for sellers, but it does have its own set of assets. It offers entrepreneurs an effortless way to get started since they give access to an existing audience. 

Because pretty much everyone uses Etsy, your store can benefit from that traction as well. Other significant advantages to online sellers include shipping labels, discount codes, and vouchers, which are great for maintaining customer retention, advertising opportunities, email alerts sent directly to customers when products are back in stock, etc. 

The Bottom Line

So, who won the fight? Well, it’s really up to the owner of the online business. Some businesses prefer making their shops as customizable as possible to get traction, and others would prefer to lean into Etsy’s already existing popularity to gain customers. 

Some buyers may prefer Shopify’s web design and various payment options, and others may go for Etsy’s shipping labels and the possibility to make discount codes for customers. All in all, the true winner is always decided by you, the business owner. So, try out these two options and see which one is best for you!

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Is Your Ecommerce Conversion Rate Good Enough?

It is true to say that people are in business to make money, no doubt. And some are in business to make more money apart from their jobs. However, it is not easy to sell if your site is not attractive enough. 

You might be tired of paying for ads to attract people to your store and watching them leave without buying anything. Yes, that can be very frustrating. 

Many people ask themselves whether their conversion rate is optimal or simply good enough. Well, many factors will determine that question, for example, the product or category. It is not the same to sell cars as to sell clothes. To be clear, the conversion rate is given by the seller’s sales transactions divided by the number of people who viewed the item. 

To know that, you first need to know what your conversion rate is, and you need to know the averages to compare those numbers to yours. 

Average Rates

As stated above, you need to know the average rates compared to yours, and this way, be better informed. The average conversion rate from 2015 till 2020 for E-Commerce is about 2.63%. That means that around 2.63% of the people who view the product buy it. You might think this number is minimal, but in reality, it is quite a lot. However, as we will examine later, many factors will impact those numbers.  

What is a reasonable conversion rate for your business? 

There are a couple of things to look at. First, if your rate is improving, then it is a good one. However, all businesses are compared to their nearest competitor. While that is very important, you need to know something: the most crucial competitor to you, it’s you! 

However, we will go through all the significant factors to understand your averages better, so you can analyze and see where these are standing.

First, a significant factor is the industry. It is not the same conversion rate when a child goes into a store to buy candy compared to when an adult goes into a website to buy a watch. For you to know, the average conversion for arts and crafts is at 4%, while the baby and child industry is at 0.7%, the lowest for all industries. Here are some of the industries you might be interested in: 

  • Electrical Equipment—2.7%
  • Pet care—2.5%
  • Cars & motorcycling—1.4%

Another factor you should take into consideration is the product type. This could determine your conversion rate significantly. So, if you think that you have low conversion rates, you might just be trying to sell a low-converting product. 

Moreover, a factor that will significantly change your conversion rates is the country you are trying to sell in. For obvious reasons, it is not the same to sell a smartphone in Germany as in Thailand. Especially when it comes to E-commerce, there are populations more used to others, and there are populations that tend to buy more online instead of in an actual store. 

Take this case: Germany has the highest conversion rates, averaging 2.2%, while Italy has the lowest average conversion rate of 1%. So, if you want to know if your conversion rates are reasonable, take a look at where your customer base is coming from. Having a 1.5% in Italy is good but having the same rate in Germany is not.  

There is one factor that might be the most impactful in the data, and that is the traffic source. Traffic source refers to where your customer comes from. There are two sources: warm and cold. Warm sources refer to referrals or emails, and their conversion rates are way higher than cold sources, which refer to sources like paid advertising or social media. 

Email and referral convert at 5.2% and 5.4%. The higher rates are mainly because traffic has already heard about you before going into your web page. Cold source traffic converts at 1.4%, which is not as bad as you think since it is pretty close to the overall E-Commerce average. 

Also, it is not the same as which device is used when navigating through a webpage. Usually, web pages are better designed for laptops or computers, so people trust computers better than phones. It is not always the case, but it varies the conversion rates. The conversion rate for smartphones is 1.8%, while desktops’ rate is 3.9% on average. 

You must know this; all these factors will influence your rates, so be sure to know all you need to know before saying that your rates are either good or bad.  

Constant Progress 

It is vital to understand that conversion rates will not grow or decrease significantly overnight unless something catastrophic happens, which is not usually the case. Typically, the case is that you have to work hard to see some results constantly. You can do more with what you have, which is good; you always have room for improvement. 

Conclusion

To sum up, the conversion rates will never be as reasonable as they can be, but you might as well try it. As I’ve said before, anyone in the business world is there to make money, and since you are interested in making it, conversion rates should be a significant concern. People who think that their conversion rates are optimal are wrong. They can always do better. So, if you feel like yours are good enough, there is probably something you can do to make those numbers rise. Considering all the factors and planning a good strategy can result in more revenue without spending much money on advertising.

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How to Analyze the Root Causes of Chargebacks

Chargebacks are disputed everyday at every business, sometimes they can be difficult but have you ever looked back and analyzed the true cause for the chargeback?  Chargebacks are a common problem for businesses and especially for high-risk businesses. Chargebacks protect the consumer from fraudulent transactions as well as rectify errors from simple miscommunication. It’s not just small businesses that are subject to chargebacks; large, established retail enterprises fall prey to chargebacks as well. As such, it is essential to analyze the root causes of chargebacks carefully. Such analysis may uncover genuine problems with specific areas of operations of a business that may need to be rectified to wrest control over chargebacks.

Below, we explore what chargebacks are, why they are essential to dispute effectively, the root causes of chargebacks, how to analyze these root causes, and what preventive measures to take to prevent chargebacks from occurring.

What are Chargebacks?

Chargebacks are payment disputes the customer raises about a particular charge to their credit card. When a chargeback arises, the issuing bank withholds the funds from the merchant until it decides the accuracy of the transaction. If the bank rules for the business, the funds are released to the merchant. However, if the bank rules in favor of the customer, it reverses the charge on the customer’s credit card. The chargeback process is often a lengthy and cumbersome process that requires a significant amount of documentation and recordkeeping.

Importance of chargeback disputes

Disputing chargebacks is a crucial facet of running a business. There are specific cash flows associated with transactions involved in chargebacks that are suddenly on hold and may not possibly arrive. This becomes even more pronounced because the business has already incurred the costs of manufacturing the product, shipping it out and may now be assessed chargeback fees if the dispute is unsuccessful.

As businesses go through the motions of the dispute, they simultaneously need to get to the root cause of why the chargeback transpired. Everything from fraudulent activities to genuine issues the client raises, analyzing chargebacks’ root causes is vital to tackle recurring problems effectively.

Analyzing chargebacks root causes 

Merchants often revert to focusing on the disputing chargebacks and the revenue lost and how to adjust budgets for the cash flow that will not be coming in. Those are necessary steps for a business to carry out but only the first steps in a series of actions they must take.

There is a lot of information available in the chargeback merchants receive. For starters, merchants can analyze the cause of the transactions being disputed. Reviewing these causes can help merchants get to the root causes of chargebacks in their business. This root cause analysis may uncover that specific changes may be needed in any one of the following areas:

Customer Support – Evaluate whether the customer made any effort to reach out to the support team to rectify any qualms about the product before filing a chargeback complaint with the bank. It is essential to understand the consumer journey and identify any friction that can lead to miscommunication or a lack of communication that manifests into chargebacks unnecessarily.

Delivery – What are the merchant’s processes around the delivery of goods. It may be a bit hard to successfully dispute a chargeback when a child’s Christmas gift ordered a week in advance is received on Easter. Preferred delivery vendor relations may be offering your charge rates but costing you much more in lost revenue and negative customer feedback.

Sales Staff – Having a professional and well-trained sales staff is vital to a robust revenue pipeline and happy clients. If your sales team is overpromising and hyping up expectations of customers that don’t pan out upon delivery, it may be time to revisit your company’s sales tactics. You want to ensure overzealous sales staff aren’t being too aggressive in closing sales that customers end up regretting shortly after purchasing the product, let alone receiving it.

Product – This is a critical facet to consider. There may be a shortcoming with the product that the client doesn’t value as much. Is it a manufacturing or quality flaw? Are there durability issues? Lower quality goods can lead to client dissatisfaction and chargebacks. Furthermore, word of mouth in today’s hyper-social environment can further alienate clients from your company’s products if quality issues lead to chargebacks.

Card Related issues – Was the card valid? Was all the credit card information collected to process the payment? Merchants should carefully review the process in place of collection, verifying, and storing card data to ensure that there aren’t any inefficiencies in that operation leading to chargebacks.

Safeguards around chargebacks

Once businesses understand the true nature of the problems that give rise to chargebacks, they can successfully place safeguards to avoid them going forward. Some examples of safeguards can include:

Appropriate training levels for sales staff to work with clients by partnering with them as trusted advisors instead of looking to close a quick sale and moving on. It may not work all the time and may require changes from the top-down. However, it can reap significant benefits from both a revenue and branding perspective.

Emphasize stellar customer support. This will also require an investment of time and money in training and upskilling your support staff to set the appropriate tone of empathy towards current and future clients.

There are specific technologies merchants can invest in to avoid the chances of fraudulent transactions. These include:

  • 3-D Secure – an online authentication protocol for card not present transactions.
  • Tokenization – a storage mechanism of securing card data being used to process a payment.
  • BIN checkers – used by merchants to ensure the card details used in transactions are legitimate before they process the payments

Understandably, chargebacks are not an easy issue to tackle for businesses. Chargebacks cost real money. Merchants end up paying for chargebacks in many ways; through lost sales, shipping and handling costs borne by them, and chargeback fees by the merchant account provider. The merchant account provider may also start evaluating the merchant as a high-risk business leading to higher payment processing rates.

Sometimes it isn’t in a merchant’s control how a chargeback dispute is settled. However, there is hope and reason to be optimistic and take action on the matter. Merchants have a lot of control over chargebacks arising. By being deliberately proactive and using the steps in tackling chargebacks it will become easier to dispute them. 

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Merchants Called To the Offensive In Battle Against Cyber Fraud

Cyber Fraud has been a concern that merchants have been dealing with for a while. But the increasing use of online payments during the global pandemic has forced merchants to take it a little more seriously. The risk of fraud has never been greater than it is now.

People are engaging in fraudulent activities while online more than ever. Friendly fraud is a concern, as people are requesting chargebacks on many transactions after they collect their items. While customers are running off with various things, online retailers are losing money from chargebacks. 

Traditional forms of cyber fraud are still prominent. These include the use of malware, remote access Trojans, and other things that can target a merchant’s system. It becomes easy for thieves to steal data and compromise a website with these tools. A business will lose money on chargebacks if this happens. These chargebacks can be worth significant amounts of money, as data thieves often make expensive purchases through the identities they steal.

Online merchants are more susceptible to fraud than ever, but it doesn’t have to be this way. These retailers are working harder than ever to control cyber fraud. They are using many efforts to reduce the risk of fraud and to keep their investments under control. All of these moves are about going on the offensive and working harder towards identifying fraud.

Confirming the Customer’s Identity

Many cases of cyber fraud can occur when a person tries passing oneself off as another person. Online identity theft is a concern, as anyone could log into an account and claim to be that person. The customer will quickly engage in fraud after stealing that identity.

Merchants are fighting this form of fraud by using further measures to confirm each customer’s identity. The business can confirm details like one’s billing and mailing address, credit card data, and other factors.

The customer’s IP address will also be a factor. The IP address of the connection one uses when purchasing something would have to link up to the billing or mailing address one uses, for example.

Customers can also monitor other things surrounding a person’s identity, like one’s phone number or email address. A phone number might be listed in an area outside one’s area or have a billing address outside where one lives. The email address might also look fake or be registered in a different spot.

Other sudden changes like a higher frequency of orders or a significant increase in one’s order amount versus prior purchases could also be points of review. Merchants can check these things to flag possible fraudulent activities that might result in chargebacks.

Managing Internal Data

Internal data can also help identify cases of fraud. The business can monitor all the activities the customer enters. The team can monitor when that person logs into an account, what products someone purchases, unique promo codes one uses, and other activities. A merchant can compare internal data with everything else a customer is doing to confirm a transaction or to directly question whatever someone is doing while online.

The work is about finding unique changes in one’s behaviors. Anything that is out of the ordinary will be flagged. The goal is to prevent the customer from completing the transaction before anything can go forward.

Finding Fraud Through Behavioral Analysis

Artificial intelligence will play a critical role in preventing cyber fraud in the future. Behavioral biometrics technology is one part of the work. This system is a solution where a customer’s behavior is monitored in real-time. The customer’s interactions with online apps and devices are measured to identify how they act and if they show signs of possible fraud. The AI system will review these details and determine if the user is real or if that person is trying to commit fraud.

The behavioral biometrics system can also identify when a user is a remote access Trojan, a malware program, or a non-human entity. The effort can catch parties that might commit fraud. The work does not entail going through specific private details, but rather about confirming the person is accessing a site from a place where one might appear.

Positive Profiling Also Works

Another solution for preventing cyber fraud entails positive profiling. The practice involves using Big Data to review a person’s behavior through various retailers and websites. The customer’s behavior is compared with actions from other confirmed fraud suspects. The customer is screened instead of the transaction, providing a more accurate response to the issue.

Positive profiling is not about trying to uncover private data on a customer. It is about monitoring the customer’s shopping activities. It confirms that the customer is acting like any other shopper and that nothing is out of the ordinary.

A Chronological Analysis

The last point merchants are using to stop cyber fraud entails using a chronological review of everything happening in a chargeback. This part of stopping cyber fraud entails what happens after the transaction, but it can potentially prevent friendly fraud cases.

A time-based review can analyze the customer’s identity, prior purchase or shopping behaviors, and other details surrounding a transaction. The retailer can review how the deal is different or similar to others. The work is about showing that a person might have made a proper transaction and is trying to cheat one’s way out of paying for it. But it could also confirm that a legitimate chargeback is necessary. Whatever the case, it can still reduce the general risk of excess chargebacks in the process.

Will Everything Work?

People are going to keep on attempting cyber fraud no matter what happens. Some people will want a free ride on things, while others might be desperate and willing to do what it takes to avoid spending money on items. Whatever the case, online retailers are more proactive in reviewing possible cyber fraud cases. Their work is about preventing fraud and protecting their investments. With fraud being on the rise, these businesses will need to be more adamant when fighting fraud.

Frequently Asked Questions

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Top Ways Merchants Can Succeed During the Holidays in 2020

COVID-19 changed so much for millions of people, but retailers were among the hardest hit. Now that the holidays are upon us, retailers must act smart and fast. What happens in the last quarter of 2020 could make or break your business.

So how can you succeed during the holidays? Check out our hottest tips.

Have an Online Presence

Every business, even small brick-and-mortar stores need an online presence. Millions of consumers will shop online this year and skip in-person shopping altogether. Not having an online presence could be the difference between staying in business or not.

If you already had a website now is a great time revamp, update, or otherwise make it better.

Make Sure your Website is Fast and User Friendly

Your website must be able to handle a lot of traffic and your staff able to handle the influx of shipments, deliveries, and returns, all while providing great customer service. If shoppers are frustrated at your website speed, they may move onto a competitor.

Aside from speed, think of user-friendliness. How easy is it to use the website? Can all customers (including new customers) find what they need quickly? Is it easy to spot where and how they can contact customer service?

Offer Valuable Services

Today, consumers want to know what you’ll do for them that goes above and beyond the norm. Sure, they can order online, but what else do you offer?

Here are a few ideas:

  • Curbside pickup for contactless service
  • Real-time inventory updates for better service
  • Offer more payment options including ‘buy now pay later’
  • Staff accordingly so you can answer customer questions, provide timely curbside pickup times, and offer any other necessary support

Market your Business

Don’t forget in the madness of the holiday rush, all the changes, and observing COVID-19 regulations, to market your business.

All businesses will be operating online and hoping for the same target audience. Find a way to stand out from the crowd. What do you have to offer that others don’t? Focus on that when you market your business.

Don’t forget to get on social media – all platforms including Facebook, Instagram, and even Tik Tok if you have a young audience. Offer specials and give other reasons to get your company ahead of the market.

Get Ahead of the Market

This year will look different than any others. Black Friday may not bring in the same numbers in-store, but you can do the same thing online. Appeal to your audience who feels more comfortable staying home and prepare yourself now.

Most customers are shopping early this year – don’t miss the opportunity to grab the sales now, earlier than ever, and build trust in your customers. Don’t use this as a time of trial and error, but rather a time to find a solution to the problem that all businesses will face today – satisfying both the in-person and online customer to the same level.

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Merchants Prepare for Over $40 Billion in Returns [2023 Update]

Not everyone is always thrilled with their Christmas gifts, and now that we can shop for anything we want with relative ease and next to no effort, so too can we return items.

Holiday Record E-commerce SalesYear on year, Christmas shopping habits are growing and the dollar amount consumers spend is on the rise. It’s only inevitable that so too should returns increase. This is why this year, merchants are expecting to refund a whopping estimate of $41.6 billion worth of merchandise bought online. At least this is what a study undertaken by the commercial real estate services firm CBRE is estimating, along with their partner Optoro, which specializes in assisting merchants when it comes to processing returns. The projection for 2018 was $37 billion, so this is a pretty hefty increase which would make for an all-time record.

By assuming that, on average, around 15% to 30% of all online purchases are returned, CBRE and Optoro can calculate the return figure. By contrast, old-fashioned brick and mortar store shoppers return around 13% of their purchases.

An Early Start to Online Returns and High Volume

CBRE and Optoro’s report also states that each year, the return rate in the retail industry grows by around 10%, and up from last years $90 billion, this year’s overall cost of returns, both online and in-store, is predicted to reach upwards of $100 billion.

In other areas, USPS is expecting to handle over 1 million returned packages each day of the Christmas period, with its peak hitting on January 2nd with 1.9 million items, over 26% higher than the peak so far in 2019.

CBRE Matt Walaszek Report

According to associate director of industrial and logistics research at CBRE Matt Walaszek, “[The Christmas period is] a time when retailers are seeing all these sales and that does not translate into rising profit margins. However, the returns are quite costly. The costs are the number 1 stressor for the retailers.”

Inefficient methods for handling returns costs the retail industry around $50 billion each year, according to Optoro. Also, with over 10 billion “needless shipments” each year, costs really are adding up for retailers. Often, retailers aren’t able to resell returned merchandise themselves, so one tactic is to try to sell the merchandise to discount stores. Failing that, merchandise has to be destroyed, which, along with the $50 billion in costs each year, generates 5 billion pounds of waste.

Continuing on from what he said before, Walaszek added, “Customers have gotten really accustomed to free returns. We are really spoiled. And retailers have to figure this out to be able to compete in this marketplace.”

Conclusion

Christmas retail sales are expected to rise around 3.8% to 4.2% this year, which would see sales between $727.9 billion and $730.7 billion. With all these increases in sales, money lost through returns is only going to continue to increase too.

What is “Friendly Fraud” and How Can My Business Handle It?

Friendly fraud can be summed up as an honest mistake: reporting a charge as fraud when a customer did indeed make that purchase.  Often times this happens unwittingly either by another member of the household or by the cardholder themselves long since forgotten. Instead of working with the merchant to obtain a refund, customers file a chargeback with their credit card company, resulting in the bank issuing a refund on the merchant’s behalf although the merchant did not commit a mistake.

Various Reasons for Chargebacks

Whether they claim the product wasn’t delivered or the product didn’t match the proper description of the item, a customer can file a chargeback for these and other reasons. Sometimes customers simply do not know the difference between a return with the merchant and a chargeback from the bank. Other times, virtual shoplifters leverage the chargeback rules in their favor by ordering goods, receiving those goods, and then not paying by disputing the charge also known as chargeback fraud. 

In addition to the cost of the goods, merchants also pay chargeback fees, lose shipping costs, and spend time and money disputing charges. Making up 40 to 80 percent of a business’s losses in fraud total, friendly fraud results in merchants eating the costs.

Minimizing Friendly Fraud Incidents

Merchants can implement several practices in preventing chargebacks including keeping an open line of communication with customers. This will help customers get in touch with the merchant rather than the bank when they need to return a product or service. 

Merchants should also make their billing descriptor easy to identify. The name of your business on a credit card statement should trigger a memory of a legitimate purchase rather than trigger alarm that someone is fraudulently charging goods to a customer’s card.

merchant services refund policyMerchants can display the refund policy on their website outlining the timeline in which the customer must return the product. If merchants offer refunds and cancellations immediately, customers won’t need to resort to filing chargebacks with the bank. Merchants can make it easy for customers to return a product with pre-paid shipping labels. Also, merchants can notify customers of recurring payments to prevent a surprise charge and the resulting call to the bank. 

In addition to using delivery confirmation as a business practice, merchants can also keep a paper trail of all transactions to further inform customers of the details of the purchase. By offering details about the transaction, merchants can help customers recognize the purchase. This practice will dissuade fraudsters with ill intent from pursuing fraudulent purchases from the merchant with the current and future purchases. 

On the front end of the transactions, merchants can collect as much customer data as possible to help keep track of the order history. In this same session, merchants can use a software requiring customers enter their complete credit card information, as well as allowing customers to review the order and then verify the purchase. 

Merchants can also use data to notice trends with repeat offenders of friendly fraud. With heavy doses of data and communication, merchants can make cuts in their friendly fraud costs, as well as improve their relationships with customers.