Google Chargebacks Are Breaking You
Anyone who’s spent any time running an online business has probably stopped for a moment to imagine what it must be like to be Google. To be at the absolute top of your industry, with virtually unlimited resources at your disposal, you could accomplish almost anything you wanted to, and who could stop you?
And yet, the word going around in the card payments industry is that Google—or to be more specific, many of the Google companies owned by Alphabet—does not fight their chargebacks. But why not? It’s not a lack of resources. If they wanted to, they could probably develop one of the most efficient chargeback-fighting operations in the world. To Google, the chargebacks they receive must seem like little toy tanks and airplanes shooting at Godzilla—annoying at times, but never an existential threat.
However, just because Google can afford to shrug off chargebacks doesn’t mean that they aren’t harmful to them, or that fighting them would be a waste of their time.
According to our sources, the two Google companies being targeted the most right now are Google Fiber and Google Ads. Fraudsters sign up for these services, then request a chargeback, then sign up again with a new account to repeat the process.
How Much Money Is Google Losing To Chargebacks?
Alphabet’s revenues were over $115 billion in 2018, with the vast majority of that coming from Google Ads and a much smaller portion—less than $1 billion—coming from “other bets” like Google Fiber. If we very conservatively estimate that these revenues are taking a hit of half a percentage point from uncontested chargebacks, that could be well over half a billion dollars they’re losing each year, while making little effort to hold on to it.
By declining to fight chargebacks, Google is passing up the opportunity to learn more about them and gather data that can be rigorously analyzed. This has implications for them that go beyond lost revenue. Google may be unchallenged when it comes to internet search engines, but businesses like Google Fiber are not without serious competition.
Who’s Filing These Chargebacks?
While it’s likely that Google’s passive attitude toward chargebacks make them a lucrative target for fraudsters, certainly many of their chargebacks will be coming from legitimate customers who have some sort of complaint or issue with Google’s products. If they don’t fight their chargebacks for a company like Google Fiber, they’re not seeing the detailed reasons for why customers are filing those chargebacks, and they are losing out on the chance to learn more about their customers’ experiences and how they could improve their products, services, and processes.
Every chargeback tells a story.™ When you don’t take the time to fight your chargebacks, you can’t learn the stories behind them, and you’re missing out on opportunities to really make your business better. Google might be able to afford to pass up these opportunities, but they’re missing them just the same.
What Could Chargeback Gurus Do?
So the question we like to ask ourselves at Chargeback Gurus is, what would it be like to handle Google’s chargebacks for them? We think the fraudsters would be the easiest ones to handle—when you take a look at fraudulent chargebacks, it is often the case that the fraudster has failed to follow the correct procedures by contacting the company before requesting a chargeback, and we would be able to win those disputes by providing the relevant documentation. We expect Google’s rates of fraudulent chargebacks would plummet once fraudsters realize they’re no longer a pushover that doesn’t fight back.
As for the chargebacks with a legitimate basis, we would be able to provide Google with both the granular data and high-level statistical analysis that would show them why these chargebacks were happening, and it would be up to them to make the necessary changes and improvements to prevent them from recurring.
The end result would be for Google to have yet more money in their pockets at year’s end, which they could then use to acquire additional value-added companies that would complement their services, growing their user base and expanding the breadth and depth of their market reach.
Smaller companies might not be able to acquire a whole new enterprise with the money they save by fighting chargebacks, but we think that no matter how small (or big) your company, the advantages you gain from fighting chargebacks are too important to ignore.
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