Chargebacks/credits

[Rolo]

Long post - and I Know this might be pretty basic stuff for some, but more information is better for everyone - might even create some spin off thoughts

How to lower credit/chargeback ratio:

Credits are the first step before chargebacks... a credit could have been a chargeback - its just a matter of how the subscriber choose to handle the issue (subscriber contacts paysite or paysite´s processor and it will become a credit... subscriber contacts his bank and it will become a chargeback). So for every credit the paysite can avoid, then the paysite is probably also lowering its chargebacks in the process

Because most credits are "short term" (big % happen within 60 days of signup), then paysites doing active things to lower credits will see fast results. First lets split credits or refunds up in 4 categories:

1. "Technical credits" happen when a subscriber does not get access to the paysite or he is not able to watch the paysite because of his computer/browser/connection.

2. "Content credits" comes from subscribers who are feeling cheated because they did not find the content they were looking for or had been promised.

3. "Subscription credits" mostly happen because subscribers cancel their trial subscription after it has recurred into a full monthly subscription.

4. "Fraud credits" are made either from dishonest subscribers or fraudtly resellers/affilates promoting the paysite.

Some of these types of credits are easier to lower than others.

One thing paysites need is infomation regarding why the credits are happing. Some subscribers will contact the paysites direct regarding why they want credits others will go direct to the processors. Some processors lets paysites know why they have issued a credit to the subscriber. Another option for paysites is that they could e-mail those subscribers who have received credits, and simply ask them "why".
Paysites collecting information regarding the credits and why they are happing is very important, so its known where to focus.

1. "Technical credits" are short term and prehaps one of the easist to lower, because paysites can control most of it. Making sure that subscribers gets instant access, and that they can find easy infomation on how to contact for technical support (e-mail, phone access etc. - if it takes more than 5-10 mins to get access, then they will demand credits insted of access). Try not to use any exotic video/plugin formats - paysites using wide accepted formats windows media, real and mpeg have less problems with their subscribers setups. Making sure that paysites loads fast, and that subscribers with slow connections also have content they can watch without waiting for 20 mins to download is also a good thing to keep subscribers happy.

2. "Content credits" are short term and can usual be spotted by looking at the tour of the paysite... does the paysites have everything inside its members area - just like tour says? Wild exaggerations are not good... also check if there are any resellers/affilates who have spiced up the promoting a bit to much.

3. "Subscription credits" are harder to fight, because they can be short term, mid term or long term... short term credits are usual subscribers who are waiting until the last day of the trial before they cancel - or the day after... they feel they "made the deadline", so when they check their credit card statement and sees a monthly subscription on top of their trial, then they will be contacting someone, either to verify that the subscription has been cancelled or to get a credit (if they call their bank, then it will most likely end with a chargeback). Now the trick is information - let them know when their subscription has ended by e-mailing them. That will satisfy most of them, and if the paysite have a good members area (see content credits), then they might be ok with the extra time, because they knew they were playing close to the "deadline", and did like the content. Mid term credits are also subscribers going over the "deadline", but there are also new reasons like subscribers who have forgot about their subscription (explaining that their subscription will be cancelled will also satisfied subscribers in mid term), wifes/girlfriends/parents checking up on credit card transaction is also a problem, but there is not much paysites can do (here its very important to have good phone support at the processors).

4. "Fraud credits" are also hard to fight. Most of this fighting is done at the processor, but the paysite can also do some work. Getting to know the paysites subscribers by checking each signup for strange info (will know when you see it - ex. usernames like "fuckyou" etc. should setoff a red flag). Also monitor paysite for password traders - new accounts which get detected by the paysite´s anti password trade script is probably made with a stolen/fake card - new subscribers which are heavy users (starts to download everything within the first 10 mins) are also worth to do an extra background check on.

Resellers/affilates fraud is also hard, but there are some tools which will make it easy to spot those (don´t think I should give away all the tactics in this forum) - but if paysites suspect a reseller is cheating then they will contact processors and/or other sponsors the reseller is using and do some asking... also sharing infomation with other paysites regarding who they have found cheating is popular.

This is just the very basic stuff, and like I said in the begining most will already know this and MORE... and its that "more" which would be nice to know about

This will help us take the "next step", which would allow us to lower our chargebacks/credits even more without costing too much on the profit side...

Who is with me and got some infomation to share



Last edited by Rolo at Jan 3 2003, 12:52 AM