Do you groan when you see another chargeback roll in? Would you describe your signature capture system as “jerry-rigged,” “improvised” or “works well enough, I guess, most of the time”? Fixing outdated signature capture may have surprising power to improve your business’ security and even marketing opportunities. Read on to learn how to keep signature capture mistakes from holding you back.
A chargeback is a consumer protection option, allowing consumers to dispute a credit card charge. If the credit company investigates and finds the charge is invalid, the merchant has to refund a purchase that had previously cleared and often pay a chargeback fee, as well. Encounter chargebacks too often, and the cost of replacing stock and paying fees can get overwhelming.
Chargebacks can happen due to fraud, either via card theft or a card user “digitally shoplifting” by claiming refunds on items they ordered online (but kept). Chargebacks can also happen with no ill intent. A customer who doesn’t recognize the charge or remember ordering an item may perform a friendly chargeback, although the effect on your business is the same. A 2016 MasterCard survey found that 60 percent of small businesses aren’t protecting themselves against online fraud, making it that much easier for chargebacks to eat into the bottom line.
Signature capture makes all the difference because you can prove that the customer did indeed authorize the purchase. Storing receipts and other transaction details in Virtual Terminals protects valuable information against a hard drive crash. Friendly fraud accounts for up to 86 percent of chargebacks, according to Global Risk Technologies, so keeping signatures on record can make a dramatic difference in reducing chargebacks.
It may seem like a minor point at first, but printing out a receipt can add an inelegant note to the customer transaction (especially if the receipt in question is one of those paper pythons for a two-item purchase). Smeared ink, a dry pen, or a sputtering printer can convey sloppiness or carelessness, which is annoying when you work hard to present a seamless experience. If you switched over to an electronic application that doesn’t fit with the rest of your software, troubleshooting an app breakdown or having to revert to paper receipts slows down the transaction.
Electronic signatures are expected to increase at a compound annual growth rate of 31.5 percent from 2016 to 2022. Maintaining up-to-date software is an important part of meeting customer expectations and staying technologically competitive.
What do digital receipts and your favorite card trick have in common? They can both serve as ice-breakers. At a party, ice-breakers get the conversation going (“How on earth did you know that was my card?”). At the register, it’s easier to get a customer’s email address so you can offer them a convenient digital receipt. From there, you have an opening to suggest that the occasional email with coupons or handy tips can continue to delight your customers.
Blue Corona found that two out of three small business owners list finding new customers as a top concern. Outdated signature capture tools that don’t integrate well with the rest of your system (or no signature capture at all) don’t help you expand your customer base. You’re losing an obvious opportunity to connect with local, interested customers who have already dropped in to make their first purchase. Capturing signatures and emails in a secure format, and weaving in marketing in a natural way, helps you create a convenient transaction experience in the moment, while setting the stage for a future relationship.
Are you set up for paperless transactions? Has reading this article uncovered new connections between signature capture, chargeback rate and marketing tactics? Tell us your thoughts below.