Got an Amazon Chargeback Email? Here’s How You Can Recover Your Money.
Working through an online marketplace like Amazon offers some great benefits to you as a merchant. You can manage inventory, invoice customers, and market products—all without the need to build out your own eCommerce platform. You also have the benefit of visibility, considering Amazon is one of the most recognizable eCommerce platforms in the world.
It’s not all sunshine, though. Operating as an Amazon Marketplace seller opens you up to the risk of chargebacks.
In this post, we’ll examine Amazon seller chargebacks. We’ll also look at what you should do after receiving an Amazon chargeback email, and what you can do to prevent future chargebacks and protect your business.
About Those Chargebacks…
Is this the first time you’ve ever received that dreaded Amazon chargeback email? If so, you might be wondering: what is a chargeback?!
Chargebacks occur because of a credit or debit cardholder dispute. It’s essentially a forced payment reversal that’s carried out by the cardholder’s issuing bank.
There are lots of chargeback reasons a cardholder might claim. The charge might have been unauthorized, or maybe the goods ordered didn’t live up to the customer’s expectations. In some cases, cardholders might even file chargebacks because of buyer’s remorse, or because they’re trying to “get something for free.”
In any case, you end up losing the revenue from the sale, any merchandise shipped, and the cost of shipping, interchange, and other overhead. You also get hit with a chargeback fee by your bank. If that’s not bad enough, chargebacks can add up over time: if you receive too many chargebacks, Amazon might start to view you as a liability, and decide to boot you from the platform.
So, you can see why it’s in your best interest to protect your business against chargebacks wherever possible. How do you go about this through Amazon Marketplace?
Chargebacks are a Problem…No Matter the Platform.
Chargebacks can add up over time, causing a serious problem for your business. Click here to learn how you can protect yourself.
How Chargebacks Work in Amazon Marketplace
When you sell goods through an online marketplace like Amazon, the site serves as an intermediary between you and the cardholder. The customer pays Amazon, and all interactions between you and your buyer are facilitated by the eCommerce giant. This means that the marketplace has the power to set the terms of your interaction, and may be aware of certain information about a transaction even before it reaches you.
If a customer disputes a purchase conducted through Amazon Marketplace, Amazon will know about it right away. They should then contact you; this Amazon chargeback email should inform you that you have seven days to choose how to proceed. You can:
Issue a Refund
Return the funds to the customer and (hopefully) resolve the dispute.
If you allow the chargeback to progress, the bank will reclaim the transaction funds and you’ll be assessed a chargeback fee.
If you believe the dispute is invalid, you can attempt to overturn the chargeback through a process called representment.
In many cases, the best idea may be to issue a refund. You’ll lose sales revenue, but a refund allows you to avoid a chargeback and protect your business against the long-term negative ramifications. Of course, this may not always be an option; if the cardholder goes directly to the bank to submit a chargeback, rather than to Amazon, then a refund would not be on the table.
If a refund is unavailable—or if you believe the cardholder is abusing the chargeback process (a practice known as friendly fraud)—then representment is the best course of action. You can fight back by selecting “Represent Your Case” from Chargeback Claims in Seller Central. Alternately, you can reply to the Amazon chargeback email and explain your intent to fight the chargeback.
Representment & Amazon Chargebacks
You should only engage in representment when you’re confident that a claim is a case of friendly fraud. You should never challenge a chargeback resulting from genuine third-party fraud or merchant error. In both these cases, it was your responsibility to take action that would have prevented the circumstances leading to the dispute. So, if a chargeback is not the product of friendly fraud, then you have no choice but to accept the losses.
Friendly fraud may be more common than you realize, though. In fact, our data suggests that approximately 61% of all chargebacks will be cases of friendly fraud by 2023. If you’re confident that a cardholder’s dispute claim does not square with the facts of the transaction, then it’s time to engage in representment.
The 2021 Chargeback Field Report
The 2021 Chargeback Field Report is now available. Based on a survey of over 400 US and UK merchants, the report presents a comprehensive, cross-vertical look at the current state of chargebacks and chargeback management.Free Download
Amazon chargeback representment is a little different from a typical chargeback claim. First, after receiving an Amazon chargeback email, you must submit documentation to Amazon (rather than to the bank). Next, an investigator from Amazon then reviews the evidence (don’t worry—none of this is visible to the cardholder). Some examples of documentation that you may submit include:
- Shipping receipts
- Tracking information
- Product specs and page copy
- Records of any interactions with the customer
If the investigator believes you have a case, they will forward the information along to the cardholder’s issuing bank. The issuer then examines the evidence against the cardholder’s claim and provides a ruling. If the issuer finds in your favor, then the funds from the transaction will be returned to your account. If they side with the cardholder, though, you will lose the funds.
In either case, there could be additional fees assessed to cover administration costs for the dispute. That’s not to mention the time and resources you must invest in digging through transaction records to compile your case.
Prevention is the Answer
Representment is a good option to recover funds and mitigate damage to your brand due to Amazon chargebacks. However, the best course of action is to prevent chargebacks wherever possible.
At Chargebacks911®, we’ve identified 50 basic practices you can implement today to prevent chargebacks, provide better service to customers, grow your business, and protect your bottom line. Don’t lose another dollar to those pesky Amazon chargeback emails. Take your strategy from defense to offense by claiming your free copy of 50 Insider Tips for Preventing Chargebacks today.
What is a chargeback alert on Amazon?
This is an email notification sent to you by Amazon, informing you that a cardholder has decided to dispute a transaction. Under card network rules, cardholders have the right to dispute a charge if it was unauthorized, or if the seller didn’t provide the goods or services promised.
How do I stop an Amazon chargeback?
Amazon may give you the option to refund a transaction before it evolves into a chargeback. However, you can’t stop a chargeback once it’s been filed. At that point, your only options are to either accept the losses or fight back through chargeback representment.
Can an Amazon chargeback be denied?
Yes; if the cardholder’s issuing bank reviews the case and decides that the cardholder does not have a valid claim, they may reject the dispute and uphold the original transaction.
What happens if you don't pay an Amazon chargeback?
Sorry, but you don’t really have any choice in the matter. The bank will automatically withdraw the disputed funds from your account, with or without your consent.