In today’s hyper-saturated marketplace, businesses are pouring an ever-increasing share of their time, effort, and financial resources into attracting new customers. It’s hardly surprising, then, that the pressure on businesses to ensure that once a potential customer comes through the door, sales are converted, and loyalty is retained is at an all-time high.
Christopher Tennyson, senior product strategy and innovation manager at Kount, an Equifax company, and Simon Vallis, the company’s head of international partnerships, lay out the steps they can take to build trust and ensure that investments in customer acquisition are not squandered.
1. Prioritise policy transparency
It might seem counterintuitive to make it easier for customers to return items or cancel subscriptions. However, companies that create obstacles for consumers could ultimately risk jeopardising future sales, Tennyson cautions. “A large majority of shoppers are looking at those policies before checking out,” he says. “So, making sure they are clear and easy to find is going to help businesses increase conversions, especially in the ecommerce space.”
That means specifying what items can be returned, explaining the process in full and outlining the appropriate returns window for shoppers. The more detail the company can provide, the harder it becomes for customers to later claim they didn’t have sufficient information. “Policy clarity is not only important for sales conversions with the consumer, but it’s also important for your own employees so they know whether or not they can accept a return,” Tennyson adds.
2. Ensure secure payment processes
Having secure payment processes is important for businesses for two reasons. First, they reduce the risk of chargebacks if a customer’s card information has been compromised. And second, secure payments signify trustworthiness and give the customer confidence that they are dealing with a reputable company. Vallis advises businesses to use reliable payment processors and technology that contain security factors that are PCI (Payment Card Industry) and PSD2 (Payment Services Directive 2) compliant.
Although this can create a layer of friction, firms may not be aware that they can use mechanisms such as TRA (Transaction Risk Analysis) exemptions for low-risk transactions, which can limit or prevent friction for customers throughout the payment journey, Vallis continues.
3. Write clear product descriptions
To avoid scenarios that could lead to returns or chargebacks, merchants should do everything in their power to ensure that expectations match up with reality. Step one, says Tennyson, is to provide customers with as much information as possible about their products. Take sizing, he suggests. When selling clothes online, retailers will do well to establish guidelines that include exact measurements. Merely designating an item as ‘medium’ won’t cut it in a competitive ecommerce landscape.
Equally, product photos and descriptions are a prime opportunity to give customers a sense of how the item will look in real life. Colours, among other things, must be identical, and a brief explainer on how products are used can work wonders to minimise misunderstandings.
To cap it off, companies must make the delivery model clear - is this a one-off purchase or a recurring monthly subscription? Tennyson emphasises: “Anything that results in unnecessary friction or an unexpected outcome for customers hurts trust and potentially brand reputation.”
4. Use recognisable billing descriptors
Where disputes are concerned, the devil is in the details. Crucially, brands need to be cognisant of how their business appears on a customer’s bank or credit card statement. Any discrepancy, whether it’s a variation from the brand name or just a store number, could cast doubts about the legitimacy of the transaction, says Tennyson.
Savvy businesses attach as much transaction data as possible to a payment, he adds. The more clarity that appears post-transaction to remind a consumer about the time, place, and item purchased the lower the risk of a chargeback. This added detail empowers banks to swiftly confirm the authenticity of a transaction in the event of a customer inquiry. Emailing or texting order confirmations can also help reduce chargeback risk by establishing absolute clarity regarding what was ordered, what the total cost was, and when it will be delivered, he adds. In doing so, customers and businesses alike find themselves on firmer ground when it comes to transaction disputes
5. Take anti-fraud measures
“Fraud prevention is often very much a balancing act,” says Vallis. He recommends that organisations embrace a fraud mitigation strategy that effectively curbs risk while supporting an uncompromised customer experience.
“As a business, you may be prepared to allow some element of fraud risk if you are selling a fairly low-value item and you want to maximise the number of orders that are accepted,” he explains. “That approach would be different to a business selling, say, Rolex watches, where the loss of one item could be more than $10,000.” Once a business understands its risk appetite, the next step is finding a suitable anti-fraud tech vendor that can reduce risk but also remove friction and make the experience better for consumers, Tennyson agrees.
6. Provide accessible customer feedback channels
Another way businesses can undo customer acquisition efforts is to make it unnecessarily complicated for customers to contact the merchant if they have a problem with a purchase. “Having a straightforward and transparent line of communication into a business is the most effective way to deal with any form of complaint or dispute because it’s ultimately those disputes that will lead to chargebacks,” says Vallis.
Merchants may also consider providing communication channels that are relevant to the customer. For example, if it is a gaming company, customers may prefer to communicate via online platforms (Twitch, say) rather than having to make a phone call. “Finding new and creative ways for customers to reach you through the platforms they are living on every day can really enhance the post-sale experience,” Tennyson concludes.
By following these basic guidelines, businesses can bolster their reputation with consumers and avoid missing out on potential sales, ensuring time and resources spent on attracting customers are not made in vain.
For more information, view Kount’s chargeback management solutions.