Take Charge of Chargebacks Part Two, Compliance in 2017

Take Charge of Chargebacks Part Two, Compliance in 2017

Ready to learn how to make 2017 your most profitable year yet?

When the dust settles and the numbers are calculated, it is estimated that across the entire payment industry, 2016 will see approximately $5.8 billion dollars in chargebacks hitting merchants, spanning some 14.7 million chargebacks.  This total is up almost 21% over 2015’s numbers. .  While this number is projected to curb slightly due to card brands stepping up their rules around when consumers can initiate a chargeback, the issue at large isn’t going anywhere soon.

A few months ago in our first installment of Take Charge of Chargebacks, we covered the basic of a chargeback as well as some of our best practices which seek to mitigate their likely hood as you sell and promote across the ClickBank platform.

In this second installment, we will be expanding on ClickBank’s specific policies and providing some great refreshers on how you can decrease the likelihood of chargebacks impacting your account.

Chargebacks and ClickBank in 2017

Effective January 1st, 2017, ClickBank is more closely aligning our policies on chargebacks to those of the major card brands. We fully understand the complications chargebacks can cause your business and as your trusted partner, we won’t leave you high and dry.  We have a number of great tips and best-practices later on in the post but first, let’s take a deeper dive into ClickBank’s Quality Policy Chargeback (CBQP) policies and how we will calculate these rates in your accounts in 2017.

ClickBank’s Quality Policy Chargeback; Our Policies

In accordance with our client contract, ClickBank defines CBQP as follows:

A purchase is “charged back” when a customer disputes a charge through their bank or credit provider, usually because the customer claims the purchase was unfunded, unauthorized or fraudulent.”

When a ClickBank vendor becomes the subject of a CBQP, the vendor is assessed a fee based on the ClickBank Quality Product Chargeback rate of the vendor’s account. The CBQP fees assessed to the vendors are as follows:

  • $22 if the account’s chargeback rate is less than 1%
  • $29+ ClickBank’s margin if the account’s chargeback rate is between 1.0%- 1.49%
  • $49 + ClickBank’s margin if the account’s chargeback rate is greater than 1.5%

 Couple of key notes:

  • These fees are assessed on an account level basis, NOT by a grouping of accounts operated by the same vendor.
  • Starting at the end of January, the CBQP fee will be based on the prior month’s chargeback rate. For example, we will use the January 2017 chargeback rate to determine the fee your account will be assessed for the month of February.

Calculating Your ClickBank Quality Policy Chargeback Rate

Calculating the CBQP rate in your account is quick and easy.  To learn how ClickBank calculates the monthly chargeback rate that will be used for these fees, follow the simple steps below within your account.

 Step 1:

 Login to your ClickBank account and navigate to the “Reporting” tab and select “Transactions” directly below.

step1

Step 2:

 Once in the “Transaction” tab, please select the date range for month to current date.  If you’d like to see a previous month’s data, please adjust the dates accordingly.

step2

Step 3:

Once the date range has been selected, please uncheck all boxes under “DebitsexceptChargebacks”.

step3

Step 4:

With the date range selected and only “Chargeback” checked, please select the “Go” button and make a note of the total chargeback dollar amount which populates the window below.

step4

 Step 5:

Now, repeat this same process, selecting the same date range, but, only selecting “Sale” and “Rebill” under “Credits”.

step5

 Step 6:

With the proper date range selected and only “Sale” and “Rebill” selected, please select “Go” and make a note of the total “Sale” and “Rebill” total which populates the window below.

step6

 Step 7:

To calculate your CBQP rate, please divide the chargeback count by your total sales count.  Using the examples above it would look like this:

36 / 3317

=.01085318 or 1.09%

If you need further assistance calculating the CBQP rate in your account please reach out to us by email or phone at [email protected] or at 1-877-367-4686.

*If your account makes healthy use of our Joint Venture Contracts feature or you run high affiliate commissions, you may want to calculate your chargeback rate via sales count instead of chargeback dollar amount.  If you are unsure if your account qualifies for this method of calculation please contact us at [email protected] or at 1-877-367-4686.

Reducing Your Risk and Growing Your Bottom Line

With the nitty-gritty details aside, let’s dive into some great ways you can leverage the ClickBank platform’s wealth of resources and tools to further mitigate the risk of chargeback rates getting out of hand within your account.

 Notify Your Subscribers

  • Occasionally, customers can forget they have been actively subscribing to your product or service. By sending quarterly subscription notifications, customers who are no longer receiving value from their subscription have the opportunity to cancel, rather than chargeback.  This also provides you a great save-a-sale opportunity to try and piece together exactly what went wrong along the customer journey.

 Trial Transparency

  • All successful relationships are built on honesty. The same adage applies to those who purchase your product or service.  Customers who elect for a trial offer should be reminded they have been signed up for a free trial within the first 30 days.  In this same reminder, make it both easy AND apparent for the customer to cancel the offer. Should they choose to cancel, the option to do so is now easy to locate.
  • Along the same lines, be sure to have monitoring tools in place to see if a customer is actively using the trial within the first 30-day period. If a customer is not, shoot them an email reminding them of their subscription and include a simple way to cancel.  If the same customer has still not used the trial around the 26th or 27th day, manually cancel their subscription before a rebill and a potential chargeback occurs.

 Step-Up Your Customer Service

  • While ClickBank is home to the best-in-class customer service, no one quite knows your product like you do. From trouble-shooting specific issues to coaching your customers through a product feature, your efforts here are the first line of defense in protecting yourself against chargebacks.  Consider looking into advanced customer service options like live chat to assist in processing refunds, cancelations and assisting your customers with any other needs which arise.

 Understanding Customer Intent

  • The beauty of the ClickBank platform is the number of ways it allows you to customize the “checkout” process. One such way is through upsell features. Many vendors on ClickBank choose to include a subscription program during this upsell process. When a customer elects to refund a core product, best practices state you should then cancel the associated upsells or subscriptions the same customer purchased after the initial offer.

 Reduce Refunds and Chargebacks, Upsell with Order Bump

  • ClickBank’s latest platform feature, OrderBump, is an excellent way to get your feet wet with upsells, all without some of the complexity which can come with introducing additional pages into your sales funnel. With low chargeback and refund rates, Order Bump has had the transformative power to increase revenue by as much as 15% in only three weeks.  Learn more about Order Bump here, including how to get started. 

 Going the Extra Mile

  • Are you in the business of selling physical products? If so, consider adding a small packing slip to each order reinforcing the product is sold by ClickBank and to keep an eye out for receipts form “CLKBank”. On occasion, a customer can forget ClickBank is the merchant of record (which will appear on their card statement).  This small extra step can increase billing transparency and reduce any confusion leading to a refund or chargeback.

 Protect Your Brand

In order to assist you further against your fight against chargebacks, we’ve put together a few more resources give you even more tools to keep your hard-earned revenue right where it belongs.

Take a moment to head on over to the ClickBank Knowledge Base and explore our official entries on getting even MORE out of your Daily Sales Snap Shot or dive deeper into our policies on refunds and chargebacks.

Supporting Your Success in 2017 and Beyond

As always, we love questions and comments.  If you have other inquiries not answered here, don’t hesitate to reach out to our support team [email protected]

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About the Author

Brett Chesney

Brett Chesney likes to write content, dissect a good email and maybe throw around a few barbells in-between. You can keep up with me on Twitter @dammitchesney. If thats not your jam shoot me an email at [email protected] where I'd be more than happy to share a good kale salad recipe with you.