Any subscription site that doesn’t watch and worry over credit card chargebacks is a site that’s doomed to have rocky finances. The problem isn’t just giving back refunds, it’s the fact that your merchant account processing fees will rise if you have too many chargebacks. Then your monthly processing limit could fall. Ultimately, you could lose your processing account completely, and have a darned hard time opening a new one.
These are not inflated fears. If your site’s chargebacks hit just 1% of total sales, you’re in deep trouble. Card processors are even more risk-averse these days then they were in better economic times.
In January, on this site, I’m doing a whole series of seminars on processing to help subscription sites. In the meantime, here’s some cool news. A new service just launched called BadCustomer.com where merchants – including eretailers as well as subscription sites — can pool information about consumers who are chargeback prone. Then, the thinking goes, you’ll be able to block these customers from purchasing at your site. It’s not about stopping the customers who honestly order and then ask for a refund because they weren’t satisfied. It’s about the creeps who take advantage of site after site on purpose.
I’m sure the privacy orgs will be up in arms. I love privacy as much as the next consumer, but as an innocent merchant who has fought chargebacks , I know which side I’m on. Think of it as a Better Business Bureau for the merchant instead of the customer – we should have the right to do business with honest, upright people.
P.S. This is not an endorsement. I haven’t spoken to the folks at BadCustomer.com yet, nor am I a client.
According to a survey run on the SIPA site for the past 70 days, the 81 respondents mainly broke into two distinctive clumps. 30% of respondents work for a publishing company that’s mainly virtual with 75-100% of staff working outside formal offices. 55% of respondents said their company is not virtual with 0-24% of staff working outside the main offices. The vast majority – nearly 100% – of SIPA members have a primarily subscription-based business model.
In my experience, virtual team success depends on experience. I usually only hire people for virtual work who already have experience of virtual work — because I’ve been burned by too many “I’m sure I’d love it” newbies in the past. Also, only experienced-in-their-craft teams tend to work well. If you are strategically building an organization that will have significant future growth with high profit margins, you may decide to staff up with a bunch of cheap inexperienced workers who your fewer, experienced staff train and manage. That business model, with a flock of cheap newbies surrounding each experienced expensive worker, pretty much requires in-house staff.
When American Express’s merchant account client service rep called to “welcome” us yesterday, he asked, “Do you go to your clients’ offices or do they come to you?”
I was stumped. In all my years in the publishing industry, I don’t think I’ve ever done either. “I’m in publishing; we publish reports and then people buy them and read them. Why would they come to my office?” I asked. “Oh, the rep answered, “It says here you’re in Advertising Services.” I am dumbfounded, “Well, change it please!” Turns out he can’t. In his database Publishing is the same thing as Advertising Services.
Because I guess there’s just that one business model, right? Yeah, that’s gotta be it.
Data from Shawn Collins 2009 AffStat Affiliate Marketing Study (available as a free 40 page report here) shows most affiliates don’t care about your super-duper-365-day-cookie. They know cookies get wiped or overwritten. 55% are fine with a 30-day cookie or less. The vast majority of the remainder are cool with a 90-day cookie.
So what do affiliates really want?
direct deposit – 62% of them really want it, not a check please!
landing pages that convert better, 80% watch their earnings per click and reject sites that don’t do well
well copywritten text links that get clicks. Text links can be better than banners.
the flexibility to be an affiliate for a wide variety of products. Only 3% chose new merchants to work with based on “relevancy to my current web sites” and 30% have more than 10 domains.
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