M-Commerce and frictionless purchasing, once industry innovations, have evolved into a necessity for today’s merchants. Once embraced only by innovators and early adopters, these and other advanced payment methods have “crossed the chasm” into acceptance by the majority of consumers. Beyond the convenience new payment methods provide consumers, can they be used for extending brand recognition?
Merchants have invested to keep up with consumer demand to shop when they want, where they want and how they want, and it’s paying dividends. A Harvard Business Review study found that omnichannel shoppers are more valuable than consumers who engage with retailers in a single place. They spend on average 4% more money every time they are in a brick-and-mortar store, and 10% more when shopping online, compared with shoppers who interact with a brand on just one channel. While this new omnichannel retail environment has been a boon for many retailers, it has left them vulnerable to both true fraud and friendly fraud.
With a few clicks or swipes, consumers can make a purchase without ever communicating with the merchant. This new freedom to shop at the speed of light can come at a hefty price if merchants are not careful. In many cases, merchants have become a commodity, lost to the anonymity of omnichannel transactions. When a brand loses its identity, it is far too easy for a consumer to rationalize committing fraud against a brand for which they have no affinity or loyalty. Given these developments in payments, extending brand recognition in new channels becomes imperative.
Revisiting the Value of a Brand
A brand is defined as the set of all tangible and intangible attributes that distinguish a product, company, organization, or cause. At its core, a brand is a promise. It is designed to positively impact the collective perceptions about a product, service or organization, forming a relationship that’s built on past experience with the brand and future expectations.
A strong merchant brand is a safe place for customers to return to again and again to make purchases from a resource they can rely on for a seamless and even pleasurable shopping experience. Achieving this level of brand loyalty is essential to a company’s ongoing growth and requires a long-term investment in its people, technology, and customer service. But that’s only part of the equation. Without a strong brand recognition strategy, the investment in building the brand may not be enough to overcome the risk of becoming a faceless and nameless consumer shopping channel.
The Role of At-a-Glance Brand Recognition for Merchants
There is no mystery to brand recognition – it’s how consumers “recognize” your business. Whether it is a memorable business name or visually appealing logo, an effective brand recognition strategy results in an at-a-glance identification of the brand, which is imperative when presented in a tightly constricted space such as an electronic billing statement. Recognition of a merchant’s brand on a billing statement can prevent consumer confusion and successfully reduce instances of consumer-initiated disputes.
Can Brand Recognition Help Reduce Friendly Fraud and Prevent Chargebacks?
Omnichannel marketing and frictionless payments are a consumer and merchant dream until a transaction dispute creates a nightmare scenario. Consumers dispute charges in three ways: friendly fraud claims, true fraud cases, and unrecognized charges.
Consumers typically contact the issuer first to dispute a charge on their billing statement, because they believe it is their best or only option to resolve the issue quickly and painlessly. Unfortunately for the merchant, the issuer often does not have enough information to address the customer concern, approves a refund and initiates the chargeback process, resulting in lost merchandise, revenue and the addition of costly fees.
Let’s revisit that scenario with one variation – at-a-glance brand recognition and transaction details available on the consumer’s banking app. In this situation, imagine if the issuer could access transaction data from the merchant and/or include it on the banking app.
- Merchant details including name, address, customer service phone number and relevant links
- Information to prevent customer confusion over how and when the purchase was made by including the type of purchase device and device name
- Consumer information including the IP address of the purchase device, phone number, email address, name and username
By providing this level of detailed information, merchants and issuers can deliver an excellent customer experience, build brand loyalty, and earn consumer trust. It can also dissuade friendly fraudsters by removing merchant anonymity from the equation, personalizing the brand relationship, and preventing false claims due to buyer’s remorse.
Enabling at-a-glance brand recognition on credit card statements can significantly prevent friendly fraud and reduce chargebacks. Contact us to learn how Verifi’s Order Insight™ can help increase brand loyalty and enhance the customer experience.