AutoPets: Littered with chargebacks no more

Cs icon1 17bd70a292692d7140c1de71f885b33527906c6c96b27f40012bdc3fd9df5130

$21k in additional monthly revenue

Cs icon2 fa37ced9eec41738736c8c4706428a9e1fd7e50167b16c136eb455dd9a819453

$0 fraud liability

Cs icon3 74f3757e32121aaa10ccf5fda4c1cdf91f3c725caf31a01e2329e5058fa87bfc

120 hrs monthly labor eliminated

Cs auto pets company e1ea8579af1713d4b15a29a03e7c61301c3ea88d8dbf34953e1ad7cef33afd74

The Company

AutoPets, the inventor, manufacturer, and retailer of the Litter-Robot, is an international leader in developing highly functional pet products that make pet care easier and more enjoyable. Launched in 2000, the Litter-Robot is the highest-rated automatic self-cleaning litter box on the market. Based in Auburn Hills, MI, AutoPets has been growing quickly and has been featured as a 2017 and 2018 Inc 5000 company.

The Challenge

As an ecommerce retailer that sells a premium priced product, AutoPets was prone to deceptive customers trying to obtain its product using stolen credit cards and other manipulative practices. In order to protect itself, Autopets manually reviewed every high value transaction as well as orders with different bill-to and ship-to addresses. They also implemented strict AVS filters at their payment gateway. However, even with these monitoring procedures, fraudsters were still finding ways to evade detection, leaving AutoPets with large chargeback losses.

As AutoPets’ order volume exploded in 2016, they realized that they needed a different approach to fraud mitigation.

They researched the various fraud detection software options to replace the basic gateway filters and manual reviews they were relying on which increased customer friction and resulted in lost sales. With chargebacks escalating up to $20,000 in some months, AutoPets knew that it needed to quickly find the right partner to stem its losses.

"As an e-commerce business, we believed card-not-present chargebacks were part of doing business. Once we found NoFraud, that belief changed. With the peace-of-mind NoFraud provides, AutoPets is allowed to continue day-to-day operations without fear of the liability from fraudulent consumer transactions.”

Cs auto pets author 6f10558cdf76c12e6e0effa48d3f6240190cdc651d9646e0086aa80b13b915a3

Leigh Edwards Controller and Director of Finance

The Solution

AutoPets was seeking a solution partner that was focused not only on preventing chargebacks, but also on optimizing AutoPets’ order acceptance rate. Another leading priority was the integration and implementation process as holiday season was fast approaching and they needed to get a solution in place before the .

Cs auto pets solution 6bbfb693316f43dde74d18da4b463c48696b9d89daf510550507ec9407ac1132

After speaking with many providers, they felt that NoFraud’s model was the best for AutoPets: powerful technology, cardholder verification to prevent false positives coupled with an easy and straightforward implementation process. NoFraud’s software quickly and seamlessly integrated with the AutoPets merchant services system just in time for the holiday season sales spike.

Initially, AutoPets carefully reviewed every order and double-checked NoFraud’s decisions to allow transactions to go through when their AVS filters flagged a purchase. They quickly learned that 84% of the orders they were previously declining were valid. Knowing that NoFraud would cover the transaction in the case of a chargeback, AutoPets felt confident about shipping orders that they would initially have declined. NoFraud significantly reduced the occurrence of chargebacks once implemented.

The Results

Before instituting NoFraud in November 2017, AutoPets was accustomed to receiving more than 20 chargebacks a month. Today, receiving a chargeback is a rare occurrence.

Over the course of one year, NoFraud saved AutoPets approximately $70,000 in fraud-related chargebacks, while simultaneously increasing their order acceptance rate by 3.5%. Additionally, NoFraud has also saved AutoPets 40 hours per week in order processing management; which includes the the time it took for customer service and accounting staff to manually screen transactions and file chargeback disputes. Customer Service has also seen a reduced checkout friction from AVS mismatches on consumer orders. When the occasional chargeback does occur, NoFraud reimburses AutoPets for the full chargeback amount as part of their Guaranteed Chargeback Protection program.

Before NoFraud

30 hrs/week spent on manual review
10 hrs/week spent on resolving chargeback disputes
$7,500 /month lost to chargebacks
$25,000/month of cancelled orders due to gateway filter declines
Customer frustration over order declines due to AVS mismatches
Internal frustration with customer service/accounting to determine suspicious orders

After NoFraud

0 hrs/week spent on manual review, chargeback dispute management
$0 fraud liability
$21,000/month in increased revenue from NoFraud approvals on orders previously declined by gateway filters
No frustration checking out with Credit Card
84% of AVS mismatched orders approved by NoFraud
No Internal Frustration, NoFraud provides pass/fail decisions on every transaction

"Since implementing NoFraud, competitors have offered us their services, but we found that NoFraud is easily the best fit for our company and our customers. NoFraud’s services are forward thinking and the customer service team is always available to answer questions.“

Cs auto pets author 6f10558cdf76c12e6e0effa48d3f6240190cdc651d9646e0086aa80b13b915a3

Leigh Edwards Controller and Director of Finance