One of my least favorite emails to receive is the dreaded chargeback notification.
A chargeback notification happens when a customer attempts to cancel an order (or receive a refund on a fulfilled order) through their credit card company or PayPal instead of contacting us directly.
When a chargeback is issued, the payment provider temporarily refunds the customer. Then they create a “case”, as it’s essential a very low-level legal claim against the publisher. We then have the opportunity to share the facts of the matter (which is almost always either that only a day or so has passed since the order was placed or that we already shipped the order to the address the customer provided). We also reach out to the customer to explain that we’re here to help if they’re willing to work with us directly instead of through the chargeback response system. 30-45 days later, the payment provider either decides in favor of the customer or the company.
I hope you can see from this description just how bad for all parties this is. By issuing a chargeback, the situation becomes one of customer vs company. I want to work with customers, not against them. That harmonious state is broken when a customer issues a chargeback, as it can threaten our ability to work with various credit card companies and PayPal. We’re also charged an additional fee if the payment provider rules in favor of the disputing customer.
Just to be perfectly clear, I absolutely support customers holding companies accountable. If your order hasn’t shipped, it’s fine to cancel it. If you ordered A and we shipped you B, it’s our responsibility to make it right. If you told us to ship to Wisconsin and we shipped to Taiwan instead, that’s our fault. If your game is missing a component, we need to send it to you (fill out this form).
The difference is that we can serve you so much faster and better if you contact us directly instead of issuing a chargeback. That way we can work with you to make it right instead of presenting our case to a payment provider. This also helps to ensure that platforms like Shopify don’t list you as a “high risk” customer, as it’s a form of fraud if you attempt a chargeback where it’s proven that you did actually receive what you ordered.
Of course, every customer’s approach to order cancellations, confusions, and frustrations is impacted by past experiences, probably including at least one where the company never replied or didn’t assist you responsibly. I’m really sorry you’ve had those poor experiences (I have too). However, I believe that the majority of companies will attempt to serve you, so chargebacks should be a last resort, not the first attempt. Please give us a chance to make it right by working directly with you.
Despite this post, chargebacks really are quite rare for us. I’m truly grateful for the vast majority of customers who contact us directly about webstore order concerns. I’m writing this simply because I don’t think many people know just how much of a hassle chargebacks are for all parties. Thanks for reading!
PS. If you ever have questions or concerns about your order, Joe and Dave are here to help at contact@stonemaier.com. They can help you the fastest if you provide the order number (especially since we now have 4 different webstores in different regions).
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Also read:
- An Open Letter to Kickstarter Backers from a Tiny Publishing Company
- An Open Letter to Gamers from a Growing Publishing Company
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14 Comments on “Chargebacks: What I Wish More Customers Knew”
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As someone who has sold product through PayPal, has always had a super fair money-back guarantees and super fast response rates, I hated whenever I got chargebacks. Fortunately, I don’t have to deal with that anymore.
As a customer, I always try to reach out to the company first, second and third. A chargeback should be your second to last result (with the last result being legal action if the situation warrants it). Not only does it pit customer versus company, but it can also be a very protracted battle. That 30 to 45 days is a lot longer than most people think it will take.
The only time in recent memory that we had to file a chargeback was against the online webstore of a large videogame publisher who sent a defective product to us. After trying to get them to process a simple return for weeks, and getting the same canned response from various customer service agents that our request was “being placed on hold pending review,” we finally resorted to a chargeback. They continued to ignore us as we continued to try and resolve the matter, and eventually we wrote complaints to the CEO, their local BBB, the FTC, and even the California Attorney General (the state they are headquartered in). We got a lovely reply from the Attorney General’s office indicating that although they don’t take legal action on individual complaints, they would contact the company for comment, and keep our complaint on file. A few days later the company approved the return, and by that time our chargeback was granted too. We sent them back their item with the prepaid shipping label they sent us, told them that since the chargeback went through we considered the matter closed, and we would not be buying from them again.
In contrast with that debacle, the (very few) times I have needed customer service from Stonemaier, they have always been among the most professional, quick, and helpful I’ve ever had.
Just a shoutout to Dave. Over last weekend i ordered a game, and decided I actually wanted everything for it, and not just the pieces I ordered. He got back to me, on the weekend, got the order cancelled, sent me a confirmation, and I ordered the complete set. One of the things I really like about buying from Stonemaier is that they are very responsive and engaged with their customers.
Most time we have chargebacks, we reach out to the customer directly outside the chargeback platform with an abbreviated version of what you stated above and a proposed solution to their problem. 100% of the time so far, they’ve let us solve it directly and drop the “claim”.
Some folks think that’s the best way to do it, and are happy to find out there’s an easier (and better!) way.
We do the same, though I would say our response rate is closer to 50%. It’s still a lot more time and hassle for us and the customer even when they’re responsive to that message.
Only time I’ve had to do charge backs really is at fast food places with mobile orders since corporate handles the money. They simply tell you to charge back essentially. You’re right though, I’m glad most companies are willing to work with the customers. Great blog!
I completely agree and try to always work with the merchant when possible. This does overlook what does happen sometimes too though, in that someones credit card number was stolen and used for the purchase. In that case, the thief has the game that was ordered (most likely) and it isn’t fair for the owner of the credit card to pay for it.
I also made a chargeback recently for a transaction that showed something like “Merchant Name: (800)123-4567” on my transaction. To be clear, it literally said Merchant Name and a placeholder number. I very likely did spend $40 with them, but since they hadn’t completed the setup of their system I couldn’t recall.
Dan: I think the first category you described–while important–is in a different category than situations where a customer is trying to change or contest an order they placed. For stolen credit cards, I think the process usually involves reporting the stolen card to the credit card company, not issuing a chargeback (it is not the fault of the publisher if someone bought something with a stolen card).
I agree that it’s confusing when helpful information isn’t listed on the credit card. I wish we had more control over that.
Chargebacks can be initiated if the customer (in this case the banks customer, not yours) claims the transaction was fraudulent. I don’t know if the bank provides the reason/category for the chargeback however when they notify you. The one that I received via Kickstarter simply said a chargeback had been requested.
In the case of accepting a stolen card, it used to be the case that they’d look at whether a merchant had adequate protections in place to prevent it (e.g. using 3dSecure or Verified by Visa) and decide where the fault lay, but now I think it’s mostly priced into the transaction fees as risk (so using 3DS results in lower fees, for example). Essentially the card brands just balance the risk between the merchant and the card issuer in the case of losses.
It’s been a long while but I used to work in forensic investigations for payment card data breaches. The payment card ecosystem is actually quite interesting, and simpler than you might expect as well :-)
So i have had to do chargebacks. Normally not a full amount. I had an online order with McDonalds. Went through the drive thru and it charged me several dollars more. Went into the store to ask about it and it’s their system and they have no control of it. So I would submit the incorrect charge to my bank with a copy of my online order total. I tried to work with them, no luck.
I have had requests to change an order with stonemaier Games and Joe was so helpful!!! It was funny, as soon as I got the invoice for the change, I paid it, faster than he could email that he sent the invoice. Every interaction I have had with Joe is always pleasant.
Funny timing on this blog post, I just received an email from Stripe that they are no longer returning chargeback fees starting June 1st…
https://www.ecommercebytes.com/2023/03/08/stripe-hikes-international-payment-fees-no-more-15-dispute-fee-refunds/
Joe replied to my email inquiry last week within 5 minutes and he had my problem solved within 15 minutes. Great experience all around.
Ugh, thank you, I feel the EXACT same way. The few times I’ve had chargebacks it seemed almost thoughtless on the part of the customer, as though they thought it was the same as asking for a refund, but the ramifications went on for a loooong time – even after they themselves contact their own bank and try to withdraw the complaint. Every time it’s been an expensive headache with no winners.
The customer service at Stonemaier has always been first-rate which I have always appreciated in an era where, generally, that customer interaction seems to have been minimised and devalued.