eCommerce Chargebacks: The Role of Returns and Refunds

Credit card chargebacks are dreaded by most online retailers, and something to avoid at all costs. So, whilst ecommerce operators try their best to avoid  fraud and therefore reduce their chargebacks, are they also concentrating on the service element to avoiding the charges?

A chargeback can be issued if there is a problem with a product or service, as well as a result of CNP Fraud, so it makes sense that ecommerce operators ensure that they have a robust returns and refunds process, to avoid customers claiming via their credit card company.

However research from ecommerce platform provider Snowvalley.com, shows that not all retailers are making the returns and refunds process simple. Unfortunately it shows that returning an unwanted item bought online is actually becoming increasingly more difficult, than when their previous research was carried out in 2008.

Five retailers actually made it impossible for customers to return their purchased items; customer service lines were down, there was no returns information available, returns systems were offline, and worst of all, these five ecommerce operators are electrical goods retailers and all appear in the Hitwise Top 50 shops list!

Not all of the report’s findings are bad news; 90% of all refunds were completed quickly and easily, using the retailers automated system, showing that the majority of retailers understand the role of the refund and return process as a means of not only reducing chargebacks but providing an excellent customer service.

The full refunds and returns report for 2009 is available at:  http://www.snowvalley.com/reports/