Platforms & Apps

The PeC Review: Makes Good Business

A free service protects merchants from bad customers—both malicious and foolish—saving time, frustration, and money.
Ecommerce merchants love customers and love providing good customer service. It is at the industry’s heart. But some customers are not so loveable and knowing who they are before you do business with them is a great luxury.

Enter BadCustomer, a free service that lets merchants check a customer’s chargeback history against a massive database of bad customers before consummating a sale. If a problem customer comes to a site protected by BadCustomer, they can be prevented from making a purchase without first committing to try to resolve issues with the merchant, should any arise, without submitting a chargeback. BadCustomer can, as such, help merchants dramatically reduce chargebacks, earning this service four out of a possible five stars in this “The PeC Review.”

The PeC Review is my weekly column devoted to introducing you to the products or service that I believe can help improve your ecommerce business, and this week, I’m going to explain why I really like BadCustomer.

There Is A Need For BadCustomer

Louis placed his order on a Thursday at 3pm Pacific Time. Moments later the online merchant sprung into action, processing the order and shipping it in less than one hour. The order was delivered ahead of the promised delivery date in pristine condition. This is great customer service, right? Well not if you ask Louis, whose order resulted in a chargeback to the merchant.

Louis is a real person, and his chargeback is documented. He claimed that the merchandise was not received even after he had it in his possession—a fact he later admitted. In this case it was not intentional fraud. Louis, who is not computer literate, did not see the order confirmation or shipping notice emails the merchant sent and assumed that the order had not been completed, so he bought similar items elsewhere. When the package arrived, he wasn’t sure how to return it, so he called his credit card company. There was not an option for returns, so he just said that he never received the items.

Louis is a bad customer. In fact, as crazy as this sounds this was not the first time Louis has submitted a chargeback that was not real. But what can a merchant do? Not much, in this case the merchant had set proper expectations, both on site and in the emails that Louis never read. Nonetheless, the merchant lost the shipping expenses both ways (the merchandise was eventually returned) and spent more than ten man-hours responding to the chargeback.

Worse, there are other cases wherein fraudulent customers purposefully try to cheat online sellers. Bob, who is a real person, regularly orders items, doesn’t answer the door when the items arrives so the carrier will leave them on the porch, and then submits a chargeback to his credit card company claiming he never received the package. Bob is intentionally ripping off online stores, but because the chargeback system is skewed to favor customers there was little a merchant can do unless the police get involved.

In case like Louis’s and Bob’s, most merchants would have preferred not to take the order, and with BadCustomer, not taking the order is just what a merchant can do.

4 Stars

BadCustomer Stops Orders Likely to End in Chargebacks

BadCustomer’s most obvious benefit is that it gives merchants the opportunity to not accept orders from bad customers, who are known to have submitted chargebacks in the past.

Personally, if a customer has ever submitted a chargeback, I don’t want to take the chance of doing business with them, so I’ll use BadCustomer to just stop the transaction in its tracks. And if my competitors want to take all of the bad customers, that is fine with me too, since these sorts of shoppers drain a business’s resources.

BadCustomer Educates Customers

Louis, the customer that I mentioned above, did not really understand how he was harming the merchant. He just did not know how to properly respond and was, perhaps, embarrassed. BadCustomer can actually help educate customers about how to properly communicate with merchants to resolve issues or concerns, eliminating the need for a chargeback.

First, merchants using the service are encouraged to place banners and explanatory information on service. I would recommend carefully explaining the issue-resolution process for your customers.

Second, when a bad customer’s order is rejected, the service explains why the order was rejected and gives the customer a change to learn about chargebacks and why they are not fair to merchants. In the end, the customer can pay a reinstatement fee and complete their order, having promised to contact the seller with concerns rather than starting another chargeback.

BadCustomer Offers a Way to Sanction Some Customers

Finally, even with BadCustomer running, you are going to get some orders from foolish or malicious customers, and when you do, you can sanction them by adding them to the BadCustomer database ensuring that they cannot buy from you or any BadCustomer partner again.

You May Need A Developer’s Help

Integrating BadCustomer into your existing checkout process may be a little too complicated from some small merchants. So you may want to engage a developer to implement the BadCustomer API.

Summing Up

Being a responsible, friendly, and customer focused retailer does not mean that you have to do business with everyone that surfs to your online store, in fact, avoiding problem shoppers can save you time, frustration, and even money, not to mention protect your store’s reputation. BadCustomer is not without its issues, for example, you will want to modify your site’s privacy policies, since you will be submitting some customer data to the service in order to check a customer’s information against the database. And at least some of the shoppers you turn away will be offended, but BadCustomer is good for business, which is why it earned four out of a possible five stars in this review.

Armando Roggio
Armando Roggio
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