Spankx LLC - Testimonial
|Company:||Spankx LLC - Testimonial|
|Industry:||Health & Beauty|
- Not happy with chargeback recovery & prevention rates of current provider
- Chargeback rate of 6%
- True fraud chargebacks close to 35%
- Chargeback & fraud losses over $1.5 Million
- Implemented FPR-360 tool to identify root causes of chargebacks
- Completed vulnerability assessment to determine current chargeback win & prevention rates
- Recommended negotiating a better service level & response rate with fulfillment and customer service vendors
- Identified fraudulent sales channels & terminated relationships of sales partners with high chargebacks
- Fought chargebacks using Smart Chargeback Representment
- Chargeback rate reduced to under 3%
- Recovered $275,000 with a win rate of 67%
- Prevented 47% of chargebacks within 8 months using FPR-360 tool & other prevention strategies
- Reduced true fraud chargebacks to 6.5%
- Improved customer retention by 28%
Choosing the Right Team
The health & beauty sector is not immune to losing revenue to chargebacks, as the owner of Spankx would come to learn in their first years of business. Spankx LLC, an online retailer of health and beauty products operating throughout North America, today earns about $12 million in annual revenue—but that success did not come without setbacks.
In his first three years of business, Lanzisera witnessed his chargebacks escalating out of control. He calculated that he had already lost $1.5 million and would continue losing up to 10% of his revenue to chargebacks if he didn't take action. In early 2016, he hired a large, well-known firm to represent Spankx in chargeback disputes and to help them identify causes and reduce their total chargebacks.
Unfortunately, even after hiring this firm, things weren't getting any better.
Lanzisera wanted to decipher why Spankx was receiving so many chargebacks, to increase their dispute win rate, and to reduce the number of future chargebacks—but none of that was happening. He felt that his company was largely ignored by the firm after the initial agreement was signed. The final straw was when he received a $28,000 pre-arbitration charge from the firm, deducted out of his bank account overnight.
Enter Chargeback Gurus
Lanzisera didn't give up. His research into other chargeback specialists pointed him to Chargeback Gurus. His challenges piqued the interest of co-founder Suresh Dakshina, who personally came to the Spanks offices to meet with Lanzisera, learn more about his company, and lay out the services they could provide. Lanzisera was impressed.
They looked at every layer of my business, spent several hours, suggested several changes in the operation without me even signing an agreement. That impressed me a lot. Chargeback Gurus team is completely different than my previous provider.
A partnership began that day in November 2016 which would pay dividends to Spankx. Lanzisera is now provided with risk and vulnerability assessments, chargeback projections and daily reports. He speaks with Chargeback Gurus by phone one a weekly basis. In addition to chargeback management and representation, Chargeback Gurus also help him with account reconciliation, setting up merchant accounts, monitoring customer service, and many more "little things".
One of the most valuable services to me is a daily report on what the customers are commenting on or complaining about. Sometimes I get a log of refunds, and this tells me why and what is going on. The key to this business is customer retention, and [using the information in this report] we’ve been able to increase it by 28%.
More than two years later, Lanzisera couldn't be happier. Spankx swiftly acted on all the advice offered by Chargeback Gurus to improve their operation, customer service processes, and protocols. The implementation of new processes and best practices combined with the hands-on, daily monitoring and reporting by Chargeback Gurus – not to mention dispute representation – has reduced the company's chargeback rate by half and nearly doubled their dispute win rate. In total, Spankx has saved over half a million dollars in revenue so far.
It's been night and day with what I used to have. They came in and made improvements to my back-office systems. They're really hands on, pro-active and transparent to deal with, and I get the pulse on how my business is doing... It comes down to the service you get after you buy. The Gurus have excellent service. The other guys? No comment.