The high-end fashion retailer is piloting beacons in three stores, using the mobile technology to send shoppers directions to in-store events.
78% of respondents to a survey by preCharge Risk Management Solutions reported a lower chargeback rate this year than in prior years. At the same time, 46% of consumer challenges of a charge were given automatic refunds in an effort to avoid chargebacks.
Credit card chargeback rates are declining among online retailers, although retailers’ efforts to fight fraud are becoming more expensive, says a survey of 1,950 online merchants by preCharge Risk Management Solutions, a developer of online payment risk management services. 78% of respondents reported a lower chargeback rate this year than in prior years. At the same time, 46% of consumer challenges of a charge were given automatic refunds in an effort to avoid the expense and potential damage to merchant standing that a chargeback creates.
More than 50% of merchants report having two or more full-time employees manually reviewing transactions on a daily basis, taking an average of 15 minutes per transaction.
The survey also reports that 96% of merchants claim to have been the victim within the past year of cases in which the cardholder placed an order then denied it, which preCharge names “friendly fraud.” Such cases can include buyer’s remorse, non-receipt of the order or simply not recognizing the charge on the statement. “Because the majority of consumers win friendly chargeback disputes, merchants have accepted friendly chargebacks as a cost of doing business,” preCharge’s report says.
The survey also asked merchants about the payment card companies’ Payment Card Industry Data Security Standards, which the card companies are requiring retailers to implement. 71% of survey respondents were unfamiliar with the policies and procedures that the PCI standards require. Of the 43% of merchants who reported they are in compliance with PCI, 92% relied on third parties as a means of maintaining their compliance.
PreCharge concludes that only about a fifth of merchants’ fraud-related costs come from actual fraud, with the rest relating to money spent preventing fraud or on lost sales. Fraud-related costs come in third-party fraud-fighting expenses, creating in-house fraud solutions because merchants don’t have total confidence in third parties, lost revenue as a result of strict fraud enforcement guidelines that reject legitimate transactions and consumers’ fears of fraud preventing them from shopping online to begin with.