Can Chatbots Decrease Chargebacks?


How Chatbots Improve Service & Decrease Chargeback Potential

It’s absolutely essential for eCommerce merchants to offer fast, responsive customer service. However, the costs associated with live, round-the-clock service across multiple avenues of contact represent a significant burden for many businesses. This is why chatbots are becoming an increasingly popular option for eCommerce merchants. When properly deployed, chatbots are an easy and cost-effective way to improve customer service and decrease chargeback potential.

Learn how to identify chargebacks caused by customer service mistakes.


What are Chatbots

Chatbots are apps designed to perform basic communicative tasks to streamline interactions between human customers and businesses. A chatbot can serve as the first interaction a customer has with a business, allowing the individual to relay his concerns while the chatbot collects and organizes important points. These interactions increasingly play-out through social media and direct messaging apps like Facebook Messenger, Kik, and WhatsApp.

This system benefits the customer by providing a quick and efficient service channel that directs them where they need to be with as few hurdles as possible. It also benefits the merchant, because chatbots are cheaper than live service and require no training, saving valuable time and resources.

Many in the business community see chatbots as the future of customer service. Consider the following facts and figures collected by Forbes:

Quick Initial Response

Contemporary customers are not willing to wait days for a response to customer service inquiries. Even if a resolution doesn’t come immediately, people want their concerns to be acknowledged. A simple greeting or request for clarification from a chatbot along with an estimate of when the customer can expect a response reassures shoppers, making them feel important, respected, and appreciated.

Automate Simple Tasks

Chatbots operate on algorithms, and the closer a question comes to resembling a basic database query, the more adept a chatbot will be in response.

Not every problem requires deep human investigation. Simple tasks like helping customers retrieve order information, or answering basic policy and procedure questions are ideal for chatbots.

Educate Consumers

Many businesses offer tutorials, demos, videos, and other content to supplement products, but consumers may still have additional questions or need clarification. Chatbots are ideal in these situations because they allow customers to ask questions and receive answers in real time while engaging with the business’s content.

Capture Customer Data

Each interaction with a chatbot is an opportunity to learn more about a customer. The more often individuals engage, the more complete and fleshed-out the merchant’s data profile of their customer.

Chatbots Provide Secondhand Benefits

Chatbots immediate benefits are obvious: faster, more-accessible customer service, and superior data-mining. The long-term benefits are equally important, because they preserve and enhance a merchants’ profitability.

Streamlined customer service practices can significantly decrease chargebacks. It cultivates reservoirs of goodwill between the customer and the merchant. It reinforces a customer’s loyalty and validates his/her decision to shop at your e-store, and demotivates a customer from seeking restitution from his/her bank.

But please note, this is ONLY true when chatbots are properly deployed. Chatbots may have the opposite affect if not closely and expertly managed, potentially resulting in greater customer frustration and more chargebacks.

The State of Chargebacks 2018

Launched as a way of collecting and analyzing industry findings, the State of Chargebacks survey reflects the experiences of more than one thousand respondents in the card-not-present space. Download to learn the latest insights on fraud and chargeback management.

Free Download

The Potential to Do Harm

Over-reliance on any single technology or solution is a problem, and chatbots are no exception. While AI technology continues to improve, a chatbot that can be trusted with full, genuine autonomy is still many years away.

Contemporary chatbots improve with additional data, but there is still a point of diminishing returns. Currently, the technology tends to max-out at 85% efficiency. In addition, making live human customer service seem too remote can “brand” a company as cold and indifferent.

One must remember that the point of automation is to remove friction from customer interactions, and to simplify and streamline the overall process. Chatbots are only useful if they achieve these ends; otherwise, they are counter-productive.

Counterbalance Machine Learning with Human Oversight

Customers want to have access to live, effective, human-based customer service at every stage of their interaction. This means:

Provide 24/7 Live Service

eCommerce does not have business hours; there’s no such thing as a 9-to-5 workday. Online shopping can take place at any time around the globe, and therefore customer service needs to be available at any time as well. One way to achieve this is through “overflow” call centers that handle calls during peak times and outside the traditional business hours.

Answer Calls in Three Rings or Less

The longer a customer waits for service, the more likely that individual is to hang-up and request a chargeback. Answering calls within the first three rings reduces the likelihood that the customer will give up on your prescribed channels.

Ensure that All Phone Numbers are Live

If customers call the number listed on a website and find it’s dead, they are very unlikely to try any other customer service channel. Make all phone numbers clearly visible on each page of your site, and ensure that the number is correct.  Don't make a lack of available contact with your clients one of the reasons for chargebacks.

Decrease Chargeback Potential by Managing Chatbots Effectively

Chatbots are important to create smooth customer interactions, decrease chargebacks, and learn more about customers. However, managing chatbots without attention to customer service best practices will cause more problems than chatbots resolve.

Do you know how to make the most of chatbots and AI technology? Concerned that you may be under-utilizing resources or alienating customers?

Our team of eCommerce experts has the necessary insight to help you free-up resources, prevent revenue-draining mistakes, and convert shoppers into buyers.

Prevent Chargebacks.

Fight Fraud.

Recover Revenue.