Tracking declined payments is a critical yet overlooked business process. Most merchants focus solely in marketing strategies. Many online sellers find out a little too late that declined payments contribute to thousands of dollars in supposedly guaranteed income.
It is considered guaranteed because the buyer is genuinely interested in the product to begin with, the sale was not consummated because of a technical error, this is the dreaded declined payment scenario.
It is important to establish a system of tracking up and following up on declined payments. This can rake in a significant increase in your sales volume. If you are among the many online sellers that currently do not have one, due to ignorance or by sheer arrogance, then it is strongly recommended that you set up one immediately.
Here are some tips to help you in setting up a tracking and follow up process:
- Assign a staff to monitor declined payments – the person must not only take note of the instances but it is imperative that he follow up on the completion of payment. This can be done by sending emails or preferably making an outgoing call. Calling ensures real time resolution of the payment issue. It also gives you an opportunity to personally connect with the customer and even offer an add-on at the most extreme level.
- Maintain a database or spreadsheet – this is important as documentation of declined payment instances. It provides a basis for analyzing what exactly is going on. Patterns and trends can be drawn from spreadsheet information from which future decisions can be based upon to address frequently occurring problems.
- Run reports weekly – this will give you a list of who to follow up with. This also gives you a short term snapshot of the events in your checkout system. Any obvious pattern has to be addressed quickly.
- Assess follow up success rate – as mentioned earlier, most declined payments are for supposedly guaranteed sales. However there are times when a customer might have really changed his mind about a purchase transaction and is relieved to find out that his payment was declined. This essentially eliminates the need for him to request for a cancelation and refund. If following up on payment produces more cost than the actual sale, then move on to the next person on your follow up list.
Tracking declined payments can be cumbersome at the onset but once your business develops a system then everything will be much simpler. Remember that this is all worth it if you consider the gains that are in store for you down the road.
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