Online dating chargebacks can disrupt even the most profitable dating websites. Since nearly all online dating transactions are card-not-present transactions, the risk for chargebacks is high. If you run an online dating service and want to significantly reduce your chargebacks that affect your bottom line, you’ve come to the right place.
This article includes everything you need about online dating chargebacks and provides actionable tips to implement immediately.
- Verifi/Ethoca chargeback alerts help you reduce your chargebacks
- Chargebacks are rampant in the online dating industry and can wreak havoc on your bottom line
- All online dating merchants benefit from fraud preventions tools such as CB-ALERT
- RDR can help reduce your chargebacks
What Is An Online Dating Chargeback?
In short, an online dating chargeback occurs when a customer initiates a dispute through their credit card issuer or bank, stating that they did not authorize a particular transaction or that the goods/services received didn’t meet their expectations.
A chargeback is different from a refund as the customer deals directly with the bank rather than the merchant, which devastates the merchants in the long run.
Real-life example: A spouse finds out their loved one is signed up to an online dating website by looking at their credit card statement. Once confronted, they claim that they didn’t sign up, and they call their bank to file a dispute. The bank will investigate and decide whether or not to charge it back to the customer. The chargeback is granted if the merchant can’t provide sufficient evidence during this period.
On top of returning funds to the customer, the bank/processor will also charge a fee for the chargeback.
This is detrimental to a merchant because your account is frozen or terminated once you exceed your chargeback threshold.
Why Do Online Dating Chargebacks Occur?
After spending two decades identifying chargeback reason codes, we can say with confidence that most of them happen due to the following reasons:
- Friendly Fraud: Buyers who appear legitimate but later file unjustified chargebacks.
- Criminal Fraud: Fraudsters who are deliberately trying to steal from your business.
- Affiliate Fraud: Affiliate marketers do not always market quality products. Customers can charge it back if they feel an affiliate marketer duped them.
- Fulfillment Issues: Packaging problems, shipping problems, or failed deliveries can all anger a customer, leading to a chargeback.
- Poor Customer Service: Poor customer service goes hand in hand with chargebacks.
- Poor Quality: Defective products that do not match product descriptions accurately.
- Dissatisfaction: The customer is simply unhappy with their purchases.
We can help you with these issues in real-time by implementing CB-ALERT. If you want to reduce your chargebacks significantly, fill out the application below.
Addressing chargebacks and fraud is essential if you want to grow your business. No matter how successful your business is, you will always fight an uphill battle if you waste money on chargebacks.
Here are some common steps all dating merchants should take to mitigate chargebacks.
- Use robust fraud prevention tools: Implementing tools such as 3DS2 authentication, RDR, and Ethoca/Verifi alerts.
- Use a merchant descriptor: An accurate merchant descriptor makes your company easier to recognize. Be sure your descriptor name matches your online storefront name.
- Partner With CB-ALERT: By partnering with us, you can stamp out fraudsters before a chargeback occurs.
- Clearly communicate transaction details: Make sure your customers understand exactly what they are purchasing, including the price and associated fees.
- Issue a refund to avoid a chargeback: In almost every case, a refund will cost you less than a chargeback. Refunds also give you a better chance of bringing the customer back.
- 24/7 Customer Service: Customer service is one of the essential things in fighting chargebacks. Good customer service can provide a refund or solve a problem before the customer disputes it with their bank.
- Use clear and concise billing descriptors: Make sure that the descriptor on your customer’s credit card statement is clear and easy to understand so that they are less likely to initiate a chargeback due to confusion.
- Keep accurate records: Maintain detailed records of all transactions, including customer contact information, order details, and any communication with the customer. This can be helpful in the event of a chargeback dispute.
- Monitor and address chargebacks: Use chargeback alert systems to address disputes promptly.
- Scrutinize Irregular Orders: If you notice an order come in from another country that you typically don’t see or if the amount is far more significant than usual, look into it to ensure accuracy.
Importance Of Customer Service
Businesses with reliable customer service can significantly reduce their chargebacks by simply responding to frustrated customers and either issuing a refund or solving their problems.
While hiring a team for customer service can be costly, it’s far cheaper than dealing with chargebacks that can destroy your business and put you on the MATCH list.
Why Partner With CB-ALERT?
If you run an online dating business, you know that chargebacks and friendly fraud can ruin a company’s finances quickly.
If you partner with CB-ALERT, we can do the heavy lifting and free up your valuable time spent fighting chargebacks so that you can manage your time and continue to grow.
We have two decades of experience in the space with an emphasis on online dating, and we know we can become a vital piece to the puzzle.
Below are some of the things we bring to the table at CB-ALERT:
- Ethoca and Verifi alerts
- 24/7 customer service
- Transparent pricing
- Visa compelling evidence 3.0
- Gateway/CRM agnostic approach
Ready to start saving money spent on dating chargebacks? Please fill out the application and help us grow your business to the next level.
What Is My Chargeback Rate?
Understanding how to calculate your chargebacks is essential to know you can stay under the chargeback threshold.
To calculate the chargeback rate, you can use this formula:
Chargeback Rate = Total monthly chargebacks divided by total monthly transactions.
Why Online Dating Is A High-Risk Industry
All dating sites are classified as high-risk merchants because of their merchant category code (MCC).
Dating sites experience more chargebacks than most industries, and banks/processors protect themselves by issuing high-risk merchant accounts.
Why Do Dating Sites Experience So Many Disputes?
There are several reasons dating sites deal with so many chargebacks. One reason is the billing model. Most dating sites offer a trial along with a subscription billing model. Therefore, merchants offering subscriptions will always be at a higher risk of chargebacks as customers can easily forget and file a friendly-fraud chargeback.
The other reason is infidelity. Rather than admit wrongdoing, a spouse will often claim the online dating subscription was fraudulent if caught by their loved one.
Say goodbye to costly online dating chargebacks by partnering with CB-ALERT. Let us fight your battle for you so you can continue growing your business in other ways.