Cohort Chargeback Rate

The Cohort Chargeback Rate is a report that represents chargebacks a vendor experiences week over week (vs. the Cohort Chargeback Alert report which shows the chargebacks BuyGoods prevented).

Chargeback rate is a metric that shows the ratio between the total number of transactions and the total number of chargebacks a merchant has earned. Below 0.65% is considered a good chargeback rate.

To access the Cohort Chargeback Rate report go to your Dashboard and click the Cohort Chargeback Rate sub tab.

Here, you will see the report which details the chargeback rate of a specific set of buyers week over week.

The oldest cohort of buyers will appear at the top. The report will allow you to view data up to the previous 12 weeks. 

In the screenshot above, there were 136 buyers the week of August 9th, 2021 with a conversion rate of 1%. There were no chargebacks until week three and the chargeback rate didn’t change through week nine.

The number of transactions a vendor processes each month can impact chargeback rate. The same goes for the average dollar value of a vendor’s transactions; for example, a small business with a small number of sales each month may get a bit more leeway than a large operation in a high-risk vertical. However, this can actually work against a vendor when calculating chargeback rate. 

If a vendor’s chargeback-to-transaction ratio sits above the acceptable threshold (above .65%), they’ll be labeled a “high-risk merchant” and may be required by BuyGoods to change their sales funnel to lower their chargeback rate. This could also mean they’ll incur other added fees.

To keep chargeback rates low, we recommend offering clear product descriptions, being transparent about your billing policy, and also provide flawless customer service. 

If you have any questions about chargeback rates, chargeback alerts, or want to brainstorm ways in which to keep chargeback rates low, please contact your Account Manager.