Are False Declines Hurting Your Online Reputation?

It’s a risk of selling products online: Legitimate transactions can get caught in a merchant’s fraud filters and accidentally declined. These false declines are expensive for merchants, with losses reaching a whopping $118 billion per year – 13 times more than losses to the credit card fraud merchants are trying to prevent. But the costs don’t stop there.

More than just the financial impact of lost orders, false declines create unhappy customers … and unhappy customers can be very vocal with their displeasure. All it takes is one bad review on social media, and a business’ reputation can be tarnished forever.

Social Media: The First Stop for Disgruntled Customers

False declines are common, but this doesn’t make them any easier for a consumer to bear. In fact, 82% of cardholders who experienced a false decline felt the decline wasn’t just inconvenient — it was also embarrassing and aggravating.

For many customers who find themselves unable to complete a transaction for mysterious reasons, one of the first places they go to vent their frustrations is social media. And they don’t hold back.



When it comes to sharing their shopping experiences, customers are far more inclined to talk about their negative experiences as opposed to their positive ones. An American Express study, for example, found that consumers tell an average of nine people about their good experiences, but they tell 16 people about the bad.

And word of mouth is devastatingly powerful thanks to the “negativity effect,” in which negative ratings and feedback can be more credible and influential to consumers than positive information. As a result, many purchasers make their buying decisions based on the worst-case scenario – even when they also see positive reviews.

If a merchant doesn’t address customers’ concerns quickly and proactively, this can create lasting brand damage.


Monitor Social Media Chatter to Avoid the Surprise of Negative Reviews

Because a merchant’s reputation is a critical part of a customer’s decision-making process, businesses must be aware of how their brand is portrayed online.

To keep a pulse on their online reputation, businesses should periodically conduct an online search for their company and product names. What are the first 10 links that show up? If a merchant doesn’t own the top search results, they open the door for high-ranking results that misrepresent the brand.

But because social media conversations don’t show up in search engine results, merchants should also monitor other aspects of their online reputation by:

  • Establishing Google Alerts for brand and relevant industry keywords
  • Monitoring Facebook, Instagram and Twitter for mentions
  • Watching review sites like Yelp for comments
  • Checking in on forums or communities where customers visit


8 Tips for Responding to Customer Complaints

Merchants with high false decline rates who find themselves on the receiving end of criticism must establish a plan to quickly defuse the situation. Consider taking these steps when responding to customer complaints:

  1. Be proactive. Don’t assume a complaint will blow over. By responding early and positively, merchants will rally supporters and take away the sting of irate customers. The faster merchants respond, the better they’ll look.


  2. Be empathetic. By showing they really hear customers, merchants gain the respect and support of customers and demonstrate they’re committed to excellent customer service.
  3. Be creative. Turn negative comments into opportunities by demonstrating a willingness to make things right.
  4. Be thorough. The best response to a negative online review is one that provides the customer with both a detailed explanation and a resolution.
  5. Don’t hide it. While a merchant’s first instinct may be to delete negative feedback, this doesn’t address the real problem and may even escalate the situation with the original poster.
  6. Connect on a human level. A personalized touch goes a long way in defusing tense situations. Using first names (of both the customer and the responder) helps everyone remember they’re dealing with real people, with real problems.
  7. Go offline. Complaints can’t always be resolved through tweets. Offering a direct email or phone number with a request to take the issue offline can help resolve issues quickly.
  8. Fix it. Was the complaint an operational issue? A problem with a product? If it’s something that can — or should — be addressed to prevent a repeat event, merchants should do so.


Merchants should keep in mind that how they publicly respond to a complaint or negative review not only impacts the disgruntled customer, it also impacts the unseen potential customers who may be watching this interaction and still considering their purchase decision. When merchants handle social media responses skillfully, they can instill trust that improves existing relationships and builds new ones.

Managing False Declines With the Right Fraud Protection Solution

While social media reviews – both good and bad – are an inevitable part of doing business online, high false decline rates don’t have to be.

Instead, merchants should consider implementing a hybrid fraud protection solution that includes a cross-functional team coupled with advanced artificial intelligence. This combination is designed to provide a frictionless experience for customers while minimizing the company’s likelihood of rejecting legitimate transactions and increasing their ability to block fraudulent ones.

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