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Beyond PCI: Digital Downloads and Security

‘Tis the season to be wary. There’s a lot of reports going around about how to be more secure and safe in your holiday shopping. Credit card scams and debit card scams are being looked out for. And shoppers are being careful. But the criminals are adapting and the danger goes beyond just phishing e-mails and retail shopping. So today, The Official Merchant Services Blog is here to talk about a particularly interesting development in security issues: video games.

We are in the midst of a very brisk holiday shopping season. Credit cards and debit cards are being swiped at record rates. Black Friday turned into Cyber Monday which then turned into Cyber Week. E-commerce, particularly mobile payments, were breaking sales records. Among this purchasing frenzy, blockbuster new video games are getting snapped up quickly. Games like Skyrim and Star Wars: The Old Republic are being rabidly purchased as gifts for gamers.

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But these new video games come with some big picture concerns that consumers need to pay attention to –– namely, security breaches that compromise their credit card information.

And that danger is related less to the video game itself and far more to the way the game is purchased, activated and enhanced. Digital downloads, virtual in-game items purchased with real money, micro-payments, are all rapidly rising trends in the video game landscape. Hackers are taking advantage of this trend by trying to find weaknesses in the security around where that information is stored.

A Brief History of Crime

Security Breaches for video game companies have been happening frequently this year. The biggest breach happened to Sony, affecting their Playstation customers as well as their PC gaming customers not once, but many times this year.

In April of 2011, the Playstation Network was hacked, compromising the vital information of 77 million accounts, and 24.5 million Sony Online Entertainment accounts. This has been touted as the largest personal data heist recorded in history, and prompted Sony to shut down its services for a month.

After that initial bomb, hackers continued to attack Sony throughout the year. Once again Sony was being breached as recent as October, according to this Forbes article.

Not Just Sony Gets Breached

This problem is spreading, however, beyond just Sony. Other companies are getting breached. Notably Turbine, maker of Dungeons and Dragons Online and Lord of the Rings Online. Allegedly the company’s community forums were hacked in early October –– around the same time Sony was being breached –– and vital customer data was breached through the hack. Turbine took their forums and community down for a week in an attempt to fix the problem.

Then in November, digital game distribution leader Valve announced there has been a security breach within its Steam database. This breach was similar to the Turbine breach in that the hack targeted the Steam community forums, which in turn opened up access to the customer database. The timing of this breach was right around the time that Steam was offering the newly launched, extremely popular Skyrim for digital download.

The Trend Targets Forums

With the recent flurry in security breaches, a trend appears to be taking shape. Hackers break into ancillary areas of a video game’s structure, notably the community forums. Because of how those areas store customer information but are still very vulnerable to security breach, which customers have critiqued and notified the company about in Turbine’s case, hackers keep targeting this weak spot. By getting in through a forum, they can find a backdoor into the database that stores the credit card information.

The big picture concern here is that more and more games are being distributed digitally, and more and more games are requiring some form of storage of credit card information for either ongoing subscriptions or micro-payments for downloadable content. Which means these hackers will be able to vigorously pursue customer information like credit card and billing information. Here’s an infographic detailing the change in video gamer behavior regarding micro-payments and digital downloads between 2008 and 2010.

Host Merchant Services infographic on video gamer trends like gold farming and micro-transactions, between 2008 and 2010.

What it’s basically showing is that subscriptions are going down, but gamers are buying more virtual items and are willing to make more and more micro-payments for content. This shows there’s a rise in the freemium model that Turbine games employ or the Downloadable Content that XBox Live games employ –– as previously noted in our blog here. And that makes the stored payment information that these gaming companies have a tasty target for hackers.

On the Horizon

It appears these attacks, and subsequent breaches, are just getting started. The Sony breach this past spring was huge and really set the stage for the ongoing assault. But the continued efforts have been relentless. Putting that activity into the context of recent reports from Verizon on lax PCI Compliance among businesses and merchants –– 79% of organizations surveyed were not fully compliant –– as well as the continued rise in micro-payments, virtual item shopping, and digital download content  in gaming systems  –– be it a pair of sneakers in sports game NBA 2K12 or an entire starship in Star Trek Online  –– these security breaches are cause for alarm.

This holiday season sees the competition between major MMORPG giant Blizzard, with their World of Warcraft game shifting to a Kung-Fu Panda inspired expansion, and Bioware’s George Lucas-fueled Star Wars: The Old Republic. Blizzard’s own security has been compromised consistently through their battlenet, so gamers need to be cautious in handing companies their information. Security needs to be stepped up. Both sides, consumer and merchant need to be proactive.

PCI Compliance And More

The PCI DSS is already stepping things up, as they’ve instituted a revamped set of PCI Compliance Standards with their version 2.0. But as the Verizon study shows, a lot of companies are struggling to maintain compliance. And PCI Compliance is really just the first step, as it tends to be a more basic set of guidelines on security, still striving to adapt to the swiftly changing schemes that hackers launch in their quest for your credit card information.

Host Merchant Services provides a Free PCI Analysis to its merchants and prospective merchants. The company also provides an informative FAQ on PCI and what it all means. And finally gives anyone interested, a step-by-step guide on how to become PCI Compliant at the most common tier for businesses.

More needs to be done, however, with e-commerce businesses. These security breaches keep happening, and they put millions of accounts  –– and credit cards  ––  at stake. The Official Merchant Services Blog will continue to monitor this developing story, especially as we get past the release dates of some major video games that have been fueling holiday shopping. But we’d love to hear from some of you. What are some tips you would offer to be more secure in your video gaming habits? Do you think there’s more risk now than there was in the past when using online gaming services such as XBox Live or subscribing to World of Warcraft? Let us know.

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Merchant Services: More Durbin News

The Official Merchant Services Blog returns to The Durbin Amendment today. We’ve been a little lax in keeping this story as updated as we were previously. Much of this month has been focusing so much more on The Holiday Shopping Season. With sales booming, and e-commerce setting record numbers, the focus slipped away from Durbin for a bit. Though it did come up a few times in connection with some of the strategies that were being utilized by both banks as well as credit card companies in terms of how they were preparing to deal with holiday shoppers.

That’s all changed now, as Durbin vaults right back into the news spotlight. Many stories have been popping up lately describing the ineffectiveness of the Durbin Amendment –– some of them citing how the law isn’t helping its intended target, small business, with its hard cap on debit swipe fees.

HMS Analysis Still On Point

This is something that came up when Host Merchant Services first reviewed the Durbin Amendment in 2011: “However, many sources speculate that the merchants will end up having to shoulder the burden of the extreme cuts in revenue that this cap brings. Those who predict that merchants will end up worse off by the amendment suggest that the banks, not wanting to take a $9 to $10 billion dollar loss in revenues for the year, will simply add fees to other payment options or get rid of premiums and extras that they had been offering merchants prior to the cap being put in place.”

WSJ Uncovers Problems with Durbin

The Wall Street Journal noted that small businesses were not reaping very many rewards from Durbin in this article. The WSJ explains the negative of Durbin on certain businesses: “Just two months after one of the most controversial parts of the Dodd-Frank financial-overhaul law was enacted, some merchants and consumers are starting to pay the price. Many business owners who sell low-priced goods like coffee and candy bars now are paying higher rates—not lower—when their customers use debit cards for transactions that are less than roughly $10.”

This gets into one of the fine-print-problems with the Durbin Amendment. Prior to the reform legislation taking effect, many banks would give businesses a discount on transactions under $10. But since the bill was placing a hard cap on all swipe fees, the banks reacted by making all transactions take place at the cap. That wouldn’t have a whole lot of impact on a retail business, like a video game store, that sells products at $50 to $200 per item. But for a place like the coffee shop cited in the WSJ article, that affects most of the menu.

The overall affect of the reform is that merchants that deal in small priced transactions are either raising prices or offering incentives to their customers to not use debit cards –– many of the incentives actually push for the consumer to switch to cash.

An Analogy

In the spirit of all that the Internet can be, I’m going to make two extremely terrible analogies to describe how I view the Durbin Amendment and the impact it is having on Merchant Services. I call these analogies terrible because though they will be informative and entertaining, in the Internet environment, they are essentially doomed. It’s a quirk of the Internet. Argument by analogy is a tool with a long and distinguished history among people debating topics in good faith. On the Internet, though, it fails every time, or close enough that it makes no difference.

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The first analogy is ripped from the sports headlines. The Durbin Amendment is playing out like the current situation in the NBA involving New Orleans Hornets guard Chris Paul. (A sports analogy, the classic internet snoozer). The NBA, due to problems with the Hornets former ownership, had taken over the failing franchise. So much like the federal government with its attempt at finance reform, the governing body of the sport stepped in to help reform the franchise. The team has a star player, Chris Paul, who told the organization that he would leave the team when his contract expires in 2012. This forced the franchise into a situation where they needed to trade him to get some hope of staying competitive, before the player’s contract runs out and he walks, leaving them with nothing.

The NBA has recently killed one trade outright (to the Los Angeles Lakers), and meddled with a second trade that scared off the team interested in the player (the other Los Angeles team, the Clippers). This is like the Durbin Amendment (Analogy time). The government wanted to help businesses deal with these fees, helping them through a rough economy. Unfortunately their meddling has ended up leaving some businesses worse off, much like the NBA’s meddling has left the Hornets in a very weak position. And the analogy can extend further: The fans are like the consumers. When the fans first heard of the deal for Paul to the Lakers there was some shock and outrage. But as the NBA meddled with it all, the fan outrage grew worse. Just like the consumers who were outraged at debit card usage fees, but once those were rescinded are now actually shouldering a much heavier burden as banks shuffle the losses brought from the hard cap into other areas of their banking services.

Durbin II: Not Going to Help Either?

So one of the recent movements has been to keep the reform from Durbin going strong by doing something similar to credit card transactions. This Marketwatch article analyzes the effectiveness of such an idea. “If we want to get the economy back on track, maybe we should pass a law that puts a cap on the interest rate banks can charge on credit cards. Doing so, according to proponents of the idea, would free up of billions of dollars that consumers could then use to inject life back into the economy.”

The suggestion is for the government to pass legislation that will force banks to limit their spread on credit card interest rates –– like 10 percentage points over the prime –– and in turn pump around $5 billion into the pockets of U.S. consumers. The idea being, with all that extra cash, U.S. consumers will spend freely again and the economy will get a kick in the pants.

Much like the Durbin Amendment with debit cards, credit experts don’t see a law like that turning out that way. According to the Marketwatch article, “For one, it wouldn’t change rates much, and two, it would have the opposite effect of that intended.”

Essentially the article suggests the plan would end up working much like the Durbin Amendment has worked. Where the idea of reform would get overshadowed by how banks and credit card companies reacted to the law. There would be some shifting, so in that sense the reform would cause change. But that eventually the burden for paying for any losses that banks and credit card companies get forced into through reform would end up squarely on the shoulders of the consumers.

Lawnmowers And Amputations

The final analogy I’m going to offer up about the Durbin Amendment comes from a friend of mine. The Government is like a lawn mower. It does one thing very very well. It mows lawns. In doing so, it uses blades. And those blades are sharp. I’m going out on a limb here (the pun will be evident in a moment) and stating that the one thing the government does really really well is to write laws. The government viewed the debit card fees as an injured person that needed its arm amputated (I guess a hard cap and a limb amputation could be congruent). The lawn mower –– in the form of the Durbin Amendment –– might not have been the best tool for the job. Nor is that same lawn mower a good tool to trim the lawn of credit card processing. Even if the grass looks so much greener right now. But it eventually got that arm lopped off.

Host Merchant Services compares Durbin Amendment to lawn mower

This is why I’m a big fan of the internet, but not a big fan of analogies. They never work out. The Durbin Amendment isn’t like the financial shenanigans of running a sports team. And it’s not really akin to landscaping through peoples’ limbs. Payment Processing can really best be described in its own context, and its own terms. Basis points are not affected by the three point arc; interchange plus processing is not like going from a push mower to a riding mower.

However, analogies like this are always fun to read. What analogy would you use to describe the Durbin Amendment? I’d love to hear some.

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Part Two: VeriFone’s Vx Terminals

The Official Merchant Services Blog continues it’s two-part epic delving into the details of what VeriFone Terminals –– specifically the Vx series –– can do. Our previous blog dealt primarily with the features of the Evolution branding and what that has done to enchance and change Vx terminals. Today, we see how that branding has worked by looking at the specific terminals themselves.

The Terminals

Host Merchant Services is able to offer a series of Vx terminals with the Evolution brand to its merchants. Keep in mind that Host Merchant Services offers free terminals to its merchants –– along with free terminal paper –– so reviewing what’s available and finding the terminal that fits you best can create a lot of savings on your processing bottom line in the long run. We begin our analysis with the Vx series, but we will be touching on the other brands and options that Host Merchant Services offers in future blogs. The list of Vx terminals that HMS can provide includes:

Host Merchant Services image of the Vx 510 Payment Processing Terminal

The Vx 510

The Vx 510 is a PCI PED and EMV approved entry-point, countertop solution that offers big things in a small package. It provides efficient performance in a sleek, compact design. Host Merchant Services is able to offer a couple of options for the Vx 510, including a DualComm specializing in retail and restaurant services and a terminal specifically designated to handle Cash Advances only.

The PCI PED approved Vx 510’s backlit display, easy-to-read menu prompts and intuitive, ATM-style interface reduce the chance of entry errors. In addition, its integrated high-speed thermal printer and internal PIN pad keep countertops clutter-free. The Vx 510 includes Ethernet and 12 MB of memory.

Host Merchant Services Image of the Vx 510 LE payment processing terminal.

The Vx 510 LE

The Vx 510LE is just what merchants want, and everything they need! This hard-working, reliable payment device efficiently processes debit and credit transactions. Plus, as a part of Vx Solutions, it is an extension of what you already know. Its ATM-style interface is instantly intuitive, requiring virtually no training. The PCI PED approved Vx 510LE is a lightweight, ergonomic device with integrated thermal printer and a built-in PIN pad can be easily handed to customers for PIN entry.

Host Merchant Services image of the Vx 570 payment processing terminal.

The Vx 570

The Vx 570 countertop solution takes performance to the next tier by combining superior speed and power for quick and reliable payment processing with increased memory to support multiple applications –– including EMV smart card transactions.

The PCI PED approved Vx 570 provides merchants with future-proof connectivity. It has built-in support for dial, and an option of combining dial and Ethernet. Dial can be used today, then switched to Ethernet at any time without added cost or inconvenience. Or merchants with broadband service already installed can immediately process payments through the always-on connection.

Smart and stylish, the Vx 570 has an intuitive, ATM-style interface and bold menu prompts to reduce help desk training time, support and costs. And its anti-glare, white backlit display provides exceptional readability. Plus, a USB memory drive allows for instant software downloads.

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The Vx 610 Wireless

The Vx 610 is a portable powerhouse, a battery-powered payment device with exceptional performance and high-end functionality. It uses the latest wireless technologies –– CDMA and GPRS –– and has advanced security with PCI PED approval.

VeriFone’s PCI PED approved Vx 610 is a wireless solution that delivers blazing performance, high-end functionality, and exceptional ease of use, without tying customers to a fixed location. It brings the point of sale to the point of service. For example, merchants can instantly open an extra lane or support an outdoor market.

The Vx 610 is powered by a 32-bit processor, so it swiftly handles even the most complex mag-stripe or smart card transactions. And its modular design provides true investment protection, allowing modules to be easily swapped should new versions of a technology emerge.

Conclusion

That’s pretty much what Host Merchant Services currently has to offer from VeriFone. Looking at the Evolution brand, it seems like the flexibility provided by the various options gives merchants an option for pretty much any type of business venture they are involved with. Future installments of this series of product reviews will take a look at offerings from other terminal manufacturers. Eventually the entire product guide will be fleshed out and we can even compare and contrast the terminals.

A Look at VeriFone’s Vx Evolution

The Official Merchant Services Blog has been covering the basics of payment processing, offering insight and tips on the general topics of the credit card and debit card transaction industry for merchants. Today we’re going to go a little deeper, and delve into a nuts and bolts topic: payment terminals. This kicks off the first two-part series where we shine a spotlight on specific terminals that are available to merchants. After the first two-parter, we’ll occasionally revisit the topic of terminals and look at offerings from other terminal manufacturers.

Keep in mind that Host Merchant Services offers free terminals to its merchants, so reviewing what’s available and finding the terminal that fits you best can create a lot of savings on your processing bottom line in the long run. Our first spotlight shines on terminal manufacturer VeriFone, specifically the Vx series.

The Vx Evolution

VeriFone offers a series of terminals on its Vx Platform that have been slightly rebranded as the Vx Evolution. The terminals are being marketed under this evolution tag as being proven, advanced and evolved. What that boils down to is a new look with some upgrades to a line of terminals that have a history of working and working well.

VeriFone lauds the Nine Advantages of the Proven Vx Platform:

  • The Verix system that the terminals use has a decade of proven use.
  • The terminals maximize communication, speed and flexibility, support value-added transactions and deliver multi-app capability that essentially enables applications to securely co-exist on the same device.
  • A seamless transition for the next generation of the line, letting you continue to run the hundreds of existing applications that work on Verix.
  • The worldwide use and support for the popular Vx platform.
  • The lack of obstacles for platform switching, making it quick and easy to get started on a Vx platform terminal if you switch from another brand.
  • The Vx series of devices is idea for virtually any vertical market or end-use scenario.
  • The enhanced toolkit, clear guidelines and helpful documentation let users quickly build solutions based on Vx Evolution’s core technologies and capabilities.
  • The intuitive user interface helps the Vx platform get deployed quickly.
  • The ARM RealView Developer Suite (RVDS) 4.0 Complier helps you compile your applications with the Verix eVo Toolkit.

 

Host Merchant Services Image of VeriFone Terminals in use.

You can review those advantages in a downloadable PDF found here.

The Other Two Benefits of Vx

VeriFone also is lauding two other advantages for its Vx Evolution of terminals: speed and security.

The Need for Speed

According to VeriFone, the Vx Evolution delivers secure payment processing eight times faster than its competition. It claims it can do this with a superior single processor that outperforms dual processors that competitors use. Using the metric of MIPS –– Million Instructions Per Second –– this graphic shows how VeriFone’s 500 MIPS ARM 11 processor works:

Host Merchant Services chart on processor speed for VeriFone terminals.

Essentially what VeriFone is saying is that competitors use a 450 MIPS processor to run applications and a second 50 MIPS processor to handle critical security tasks. They claim this slows down secure transactions to 50 MIPS. But VeriFone, with its Vx Evolution brand, utilizes a built-in, integrated security processor. It’s running at 500 MIPS for everything –– applications and security.

You can fully review VeriFone’s documentation on speed by downloading a PDF about it here.

Staying up to Date on Security

The next advantage VeriFone is lauding its Vx Evolution brand with is security. This is of particular interest to The Official Merchant Services Blog because we’ve written in the past about PCI Security Standards. In fact, we took a close look at a study by Verizon that showed 79% of merchants surveyed were not fully compliant with PCI DSS standards.

Host Merchant Services Image of a VeriFone Terminal

Host Merchant Services offers a free PCI analysis for merchants and makes PCI Compliance a priority for its merchants. Which is why the Vx Evolution brand is noteworthy.

According to VeriFone their Full Spectrum Security package –– which is standard with all of its Vx terminals in the platform –– gets their terminals up to PCI PED 2.0 standards. So Host Merchant Services, in its push to keep all of its merchants compliant year in and year out, embraces the Vx platform of terminals that are stamped with the PCI PED 2.0 Approved seal.

At a time when many merchants are having issues maintaining the old PCI security standards, the VeriFone terminals are stepping up their game and making it easier for merchants to maintain the new PCI compliance standards. This lets Host Merchant Services merchants stay compliant moving forward and gives HMS a leg up in its initiative for quick, easy, and worry-free PCI Compliance.

You can read more about the security benefits of Vx Evolution by downloading a PDF here.

To Be Continued …

In the next part of this series, we’re going to look at the terminals themselves and see how they apply those Nine Advantages VeriFone has lauded.

In the meantime, what do you think of this branding? Have you used any Vx terminals? In the past? In the present? Let us know.

Customer Service: Help Desk Stress Test

Today The Official Merchant Services Blog continues its special two-part series on Customer Service. We can’t stress enough how essential it is to focus on Customer Service –– especially now during the holiday shopping season when your business may be barraged with a lot more customers who have a lot more questions.

Yesterday, we shared with you a blog from Lauren Carlson at Software Advice. The blog gave detailed tips on how to prepare business and its customer support team for the holiday shopping season. Today we bring you the second half of Carlson’s customer service saga which focuses on utilizing the holiday season as a way to stress test your help desk.

Carlson suggests that “the holiday season represents a perfect laboratory for examining your business, as well as your performance at each point of customer contact.”

This is a compelling concept. As Carlson says, the holiday season gives you a chance to analyze your business –– especially the customer support side of it –– at super speed. Doing so lets merchants identify high performance areas that are effective under the added stress of the holiday season, as well as get some insight into areas that may need some improvement. To get merchants in the mindset of how the microcosm of the holiday season can fuel some quick on the spot analytics Carlson asks: “So you had 72 percent first-call resolution rates in August. Great. What about the day after Christmas?”

Carlson keys in on five areas of support that companies should examine during their holiday season to gauge their help desk.

Host Merchant Services blog image on customer service and help desk analysis.

How Effective is That Training?

Many merchants add seasonal help for the holiday shopping rush. It’s a tried and true method for the retail industry, for example, to take on some extra help at the end of the year to push through all that added hours and increase in customers. Carlson suggests this can be a catalyst for analyzing employee onboarding –– and get a good look at how effective your company’s system is for training and preparing new support staff.

She says “Companies should use this opportunity to examine the success of their training techniques, as well as the usability of their system.”

It’s really sound advice to keep track of your support staff’s effectiveness, and the holiday season definitely gives a merchant a focused period of time to quickly measure the staff’s performance.

How Well Do You Deal With Surprises?

The next area in help desk performance that Carlson says a company should measure during the holiday shopping season is something called The Collaboration Period. Carlson describes the first nine months of the year as a build-up or preparation period for a business. Mitch Lieberman, of Sword Ciboodle, calls that period the Coordination Period in Carlson’s blog. But, according to Lieberman, the holiday rush shifts into the Collaboration Period. Carlson quotes Lieberman as saying “Collaboration is when something is outside what could or should have been easily coordinated. Are you ready to collaborate on these emergency issues that you didn’t predict?”

Essentially, merchants can use this time to study how well support staff deals with surprises. How well can they go off script? How effectively can they cope with issues that crop up that weren’t prepared for and which aren’t on an FAQ or a PDF or a Guidelines e-mail.

Host Merchant Services blog image on customer service and help desk analysis.

Where Do the Problems Get Handled?

The next area of help desk effectiveness that Carlson suggests merchants should look at is peak load management. Businesses that bulk up with some seasonal help during the holiday rush tend to train those new employees on the basic level of support. They get training to help them stick to a script, deal with the first tier of issues in a protocol, or use the FAQ that was designed for the holiday season –– all really basic stuff. The intent being to keep the easy stuff out of the way of the veteran support team members, who are then expected to effectively handle the harder issues.

Carlson says some interesting statistics can be gathered through this dynamic: “Measuring the percentage of first-call resolutions compared to the percent of calls escalated will help to inform your peak load strategy. “

What’s Your Worst Case Scenario?

The next area Carlson says companies should analyze harkens back to the boy scouts mantra of “Be Prepared.” Carslon says “assume something bad is going to happen. It’s not pessimism. It’s good business. If you assume disaster will strike, you will have an emergency response system in place that’s ready to manage the disaster on all channels.”

It’s never good when disaster strikes. But it’s a much heavier burden on a merchant when disaster strikes during the high pressure holiday shopping period. So this is a good time period to gauge what a company’s emergency response process is. And, if things do go bad, get an up front look at how effective that protocol is. Being proactive, Carlson suggests, is the best approach. Use this time period to analyze your emergency procedures and tweak them to be the most effective they can be.  As Carlson puts it, “having proactive procedures mapped out for unforeseen emergencies will not prevent call spikes, but it can lower the spikes to a manageable amount.”

Host Merchant Services blog image on customer service and help desk analysis.

Are the Customers Satisfied?

The core element of your customer support team, and your help desk, is customer satisfaction. Is the customer happy? That’s what it all comes down to. Companies should be measuring customer satisfaction year-round. And Carlson’s blog concedes that point. But Carlson points out that the holiday shopping season heightens the importance of customer satisfaction. This is something The Official Merchant Services Blog has discussed during our series on holiday shopping as well. The stakes are higher during the focused frenzy that happens after Black Friday, so you need to make sure you’re keeping even the most basic tenets of customer service in mind at all times.

Carlson asks the question, “you might have great satisfaction rates during low-volume times of year, but is your support team still on par when things get hectic?”

She suggests something as simple as a survey of your customers asking how you did during the holidays –– basic feedback.

Host Merchant Services likes the idea of reaching out to the customers for feedback. It’s an effective way to continue to maintain the long-term relationship building goal of customer support. Or, simply put, it’s a nice way to let your customers know you value them and their input. HMS suggests utilizing your social media tools for a survey like this, as you can quickly interact with your customers through those tools and they can help you track and analyze the responses.

Conclusion

This is an effective checklist of ideas for merchants to monitor their customer support capabilities. There are some concrete suggestions here on ways to collect data that will help shape a company’s goals for delivering quality customer service. Carlson gives a lot of good tips in both parts of her series. The Official Merchant Services Blog is glad she shared these with us and hopes you find them useful too.

If anyone else has some tips or suggestions on how to improve customer service now in the holiday shopping season or any other time of the year, feel free to share in the comments section.

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Customer Service: Tips From a Friend [2023 Update]

Today The Official Merchant Services Blog begins a special two-part series on Customer Service. A previous blog focused on how important Customer Service is for a business during the holiday shopping season. We are currently in the midst of one of the busiest holiday shopping seasons on record, according to the early sales data that has been reported. So to bolster your efforts, we’re going to highlight information and advice brought to our attention from our friends over at Software Advice.

Fellow industry blogger Lauren Carlson ran a two-part series at Software Advice dealing specifically with customer service and the holidays. It’s an insightful series that begins with offering advice on how to prepare your customer service department –– namely your help desk –– for the rigors of increased business from holiday shopping.

And What Are Those Tips?

Carlson’s article was timed for the lead up to Black Friday, but much of its advice is still extremely relevant to merchants facing the rest of the season. After all, the questions that get asked at your help desk aren’t going to subside until after the holidays. Or as Carlson says, the guidelines she gives “if done, can prevent potential chaos and better prepare your agents to handle the spike. This translates to happier customers during the holidays, who will turn into repeat customers once the wrapping paper has settled.”

Host Merchant Services image on customer service, with bell ringing.

The first tip given is to create a holiday specific FAQ list. Carlson states that the types of questions a lot of help desks get hit with during the holiday season can vary from the normal questions that get asked the rest of the year and as such, suggests brainstorming and coming up with a list ahead of time to prepare. Due to timeliness, that may no longer be a viable option for a lot of merchants. But by now, you may have a pretty good handle on the varying questions that you were hit with on Black Friday and all through Cyber Week. Which brings us to the best advice found in the first tip: “Post the simpler questions up on your site to avoid spending time on those calls.”

This can be done to enhance the e-commerce experience, getting it out to your customers and providing them with both information that they need, and a click through into your site. Or this can be done just for your own help desk’s internal sanity, having a quick reference guide on hand for when they are barraged with these questions that make your list. As Carlson states, this type of list “will enable agents to resolve a majority of issues on the first call.” And it will be useful for the duration of the season, preventing your staff from having to scramble to find answers even as it gets to be late into the shopping season.

Cross-training to Stay Prepared

The next tip Carlson offers is to cross-train your staff. She cites Matt Trifiro, Senior VP of Marketing at Assistly who explains that cross-training your employees can help you reduce the need for hiring seasonal staff. Carlson says of cross-training: “Much like athletes cross-train to improve the whole body, companies can train every employee – from receptionists to accountants – to be a support agent, improving support across the entire organization.”

This is a great tip for merchants looking to weather the holiday shopping blitz but not go through the process of training seasonal help that they have to let go a short time later. It’s also a quick way to deal with support issues that may have just now cropped up well after Black Friday. Host Merchant Services itself utilizes that same philosophy in its own customer support structure and finds that it does help a business be more responsive and more effective at handling support issues year-round.

Carlson maps out the plan for cross-training your staff, suggesting that a merchant should equip all their employees to answer basic questions customers may have. Then Carlson says merchants should set up an escalation procedure for situations that require additional steps or expertise. This will create a smoother flow for service during the high traffic times of the holiday shopping season.

Communication Has Many Channels

The next tip Carlson gives revolves around communicating when your business is on its own holiday. A lot of Merchants, such as restaurants, have a different set of hours as the actual holidays approach. Carlson suggests merchants should communicate clearly and consistently with their customers about any downtime or time where the business is unavailable during the holiday shopping season. And in 2011, there are quite a lot of avenues in which to communicate this information: “Alert customers on every possible medium (website, Facebook, blog, Twitter, voicemail) of your seasonal hours and availability. Communicating this clearly will help avoid confusion and, more importantly, dissatisfaction.”

Host Merchant Services blog image for customer service.

This information also applies to any other Merchant needing to reach out to its customers –– including adding extra service hours during holiday shopping like a lot of retailers do. Social media sites like Facebook, Google+ and Twitter are amazing tools available for customer interaction and can help you keep your customers up to date on all the latest developments your business goes through during the holiday shopping season.

Support Your Support Agents

The final tip Carlson gives for merchants to prepare their customer support help desk for the holiday shopping rush is to have a plan in place that will offer support for those who are your support agents. Carlson states: ” Help desk and support center employees will be very busy and likely very stressed during the holidays. Savvy companies will invest a lot of energy into supporting their agents via rewards, bonuses, in-office R&R, etc.”

Having something concrete in place that defuses stress and gives your support team some focus or incentive can help your business navigate through the increased stress and tension that holiday shopping can place on a business. This falls in line with Host Merchant Services’ own partnership protocols in the e-commerce section of its services –– where the company’s goal is to take the stress and burden of merchant services off of the business and onto the the merchant services provider. This enhances the overall partnership by making it less stressful for both partners. The same applies to customer service, especially during a time when the increase in business can exponentially increase stress.

Even though Black Friday has passed, this increased stress will continue to build. So it’s definitely not too late to consider implementing some sort of program or incentive to give your support staff both a tip of the hat for its hard work and a goal to strive for that will keep them going through the rest of the holiday rush.

Conclusion

Host Merchant Services feature image of a happy face.Lauren Carlson offers some rock solid advice for customer support during the holiday shopping season. Many of the tips are easy to implement and do not take a lot of added time investment to get working. Host Merchant Services is always looking for useful insight on customer service to pass along to merchants. Quality customer service helps build long-term relationships with your customers, and can keep them coming back to you long after the holiday shopping season is over. Tomorrow The Official Merchant Services Blog will take a look at part two of Carlson’s series.

e commerce

E-Commerce: News Briefs [2023 Update]

The Official Merchant Services Blog continues to follow some of the top trending stories in the e-commerce industry. E-commerce is an essential growth element in most retail businesses. This has been building for years, as online shopping becomes more and more a convenient and commonplace fact of life for the everyday consumer.

E-Commerce Sets Record Highs

It became clear that e-commerce is a titanic force in the marketplace when Cyber Monday sales results came trickling in. But the robust clicks business continued. Now reports are indicating that e-commerce had a record setting week. This internet retailer article said that consumer spending reached at least $1 billion on three separate days last week according to the web measurement firm comScore Inc. This means that three of the four recorded billion dollar spending days for e-commerce occurred last week –– the fourth was Cyber Monday 2010.

The statistical breakdown shows that shoppers spent $1.25 billion on Cyber Monday 2011, the single highest spending day recorded for e-commerce by comScore. This was followed up by $1.12 billion on Tuesday and $1.03 billion on Wednesday. In the time period between Nov. 1 and Dec. 1, 2011, consumers so far this holiday shopping season have spent more than $18.69 billion with online retailers ––up 15% from approximately $16.25 billion at the same point last year.

Will The Trend Continue?

The article quotes comScore chairman Gian Fulgoni as saying “As the deals from this week expire, it will be important to see the degree to which consumers return to the same retailers to continue their holiday shopping, thereby helping improve retailers’ profit margins, or if we experience a pullback in consumer spending—which has occurred in previous years—before promotional offers and spending intensity pick back up in earnest around mid-December.”

Free Shipping appears to entice online shoppers in a major way. According to the article 63.2% of all online transactions last week included free shipping. This makes a lot of sense, since free shipping evens the playing field in the bricks vs. clicks battle. With shipping costs taken out of the equation, it comes down to convenience and price. It’s much easier for shoppers to visit a website instead of fight crowds and stand in line. And the Cyber Monday deals –– many of which got extended past Monday prompting the nickname Cyber Week to emerge –– keep the pricing war ultra competitive.

SOPA Update

With e-commerce business booming so much in the holiday shopping season, the Stop Online Piracy Act (SOPA) and its latest developments become more and more important. According to this PC World article, a bipartisan group of lawmakers have come out in support of a new law that has been proposed as an alternative to SOPA.

Under this proposed legislation, the U.S. International Trade Commission (ITC) would be given the power to investigate claims of copyright infringement on foreign websites. The proposal would also allow the ITC to issue cease-and-desist orders to foreign websites that willfully engage in copyright infringement. The lawmakers demonstrate some clever ingenuity here with this proposal by tapping the ITC for the job of piracy oversight. The ITC already investigates patent infringement complaints and can bar infringing products from being imported into the U.S.

Host Merchant Services offered up an extensive analysis of SOPA, including the history and development of previous laws that affect online piracy and intellectual property rights.

What is notable about this new law being proposed?

new law being proposed

Two of the legislators supporting the use of the ITC as copyright infringement oversight are Ron Wyden [D-OR] and Zoe Lofgren [D-CA]. Wyden is notable because he was the one that effectively killed the Combat Online Infringement and Counterfeits Act of 2010 in the Senate. Lofgren is notable because she is one of Congress’ leading experts on the internet and has spoken out against SOPA on her own website. Having these two support a proposed law that seeks to combat online piracy is a pronounced development.

The new proposal seeks to clean up the problem of SOPA by giving it a more streamlined and functional process for copyright infringement claims. Under the new proposal the ITC could also investigate complaints of copyright infringement by foreign websites. Owners of the websites would be invited to present their side to the ITC, and the public would be notified of investigations, as the ITC does in patent investigations. ITC rulings against websites could be appealed to a U.S. appeals court. All of these aspects are different from the broad powers that SOPA grants to the Department of Justice.

As the article explains: “SOPA would allow the DOJ to seek court orders to stop online ad networks and payment processors from doing business with foreign websites accused of enabling or facilitating copyright infringement. The DOJ-requested court orders could also bar search engines from linking to the allegedly infringing sites and order domain name registrars to take down the websites and Internet service providers to block subscriber access to the sites accused of infringing.

SOPA would also allow copyright holders to seek court orders requiring online advertising networks and payment processors to stop supporting the alleged infringers if those businesses do not comply with requests from copyright holders. The court orders requested by copyright holders could target U.S. websites and services that enable or facilitate copyright, in addition to foreign websites.”

The proposal states its case as being a better alternative to SOPA here: “We found that using trade laws to address the flow of infringing digital goods into the United States makes it possible to avoid many of the pitfalls that would arise from other legislative proposals currently being advanced to combat online infringement. Namely by putting the regulatory power in the hands of the International Trade Commission – versus a diversity of magistrate judges not versed in Internet and trade policy – will ensure a transparent process in which import policy is fairly and consistently applied and all interests are taken into account. When infringement is addressed only from a narrow judicial perspective, important issues pertaining to cybersecurity and the promotion of online innovation, commerce and speech get neglected. By approaching digital good infringement as a matter of regulating international commerce, we are able to take all of these factors into account.”

In short, this proposal focuses on the copyright infringement that is at the root of the online piracy, instead of on the payment processors and e-commerce sites that could get caught up in the broad crackdown that SOPA could initiate.

What’s Your Major? E-Commerce

We noted this on our Facebook Page yesterday, but feel the need the mention it in our blog as well. E-commerce is now becoming a path of study in college. This Practical E-Commerce article links to 15 different e-commerce focused course programs being offered by various institutions, including Carnegie Mellon, University of Maryland, and Temple.

Customized E-Commerce

The Official Merchant Services Blog switches its focus today back to e-commerce. After the boom in mobile phone usage this past weekend from Black Friday on through Cyber Monday, it’s becoming increasingly clear that smartphones and mobile internet users are becoming very important parts of the  e-commerce industry. As such, businesses that utilize e-commerce need to consider including the mobile phone element in their online shopping capability.

This increase in the importance of mobile usage –– most notably mobile payments –– is leading many e-commerce businesses to develop mobile apps. These mobile apps let those businesses customize their service and stay in touch with their consumers who prefer to connect via mobile networks. The trend is moving e-commerce mobile solutions away from the traditional Wireless Application Protocol (WAP) sites. That’s a paradigm shift in the industry. E-commerce businesses are developing and designing their own applications –– or at the very least branding their own versions of mobile apps.

Applications Over Surfing

E-commerce leaders are finding out that users prefer using a mobile application instead of going to a business through their mobile phone’s web interface. This article from The Hindu Business Line quotes Amarjit Batra of OLX.in as saying: “We found users more comfortable in having a mobile application than opting for mobile web search or using WAP sites.”

This change in e-commerce puts an emphasis on having payment gateways accessible across different mobile platforms. To put it simply, a business with a mobile payment aspect to its e-commerce presence needs to have a mobile payment system compatible with Android, iPhone and Blackberry.

Host Merchant Services is staying ahead of this curve, offering a series of customizable e-commerce solutions to its merchants. Included in that package are mobile payment services apps that work on both iPhone and Android. HMS keeps its options flexible so that its merchants can tap into the rapid growth in mobile payments.

Mobile is Key to E-Commerce

This growth is looking like a trend for businesses in the burgeoning mobile payments market. Juniper Research is often cited as predicting the Mobile Payment Industry is going to blossom from a $240 billion industry to a $670 billion industry by 2015. This makes it very helpful for businesses to recognize consumer behavior in terms of their mobile device usage. Google Analytics provides a great free source of tracking for e-commerce merchants to monitor traffic from mobile devices. That’s a great first step for a business to determine what kind of mobile payment option or customization might be needed for the e-commerce a merchant is already doing. At least get an indication if there is a need for mobile payments or a customized and branded mobile app for your business.

The move towards individual businesses dabbling in their own branded app development also extends from the fluid nature of the industry as it grows and evolves. With so many different companies –– Google, PayPal, Visa to name some of the giants –– all coming up with their own variation on mobile payments, the flexibility to customize and brand their own version of mobile payment services is extremely important for all players involved in the process. This includes merchants themselves as well as merchant services providers.

Stitching it all Together

Besides just crossing platforms between the major mobile carriers, the applications being developed need to integrate web services and payment options into the solution. Essentially the goal is to make e-commerce seamless for mobile users as well as internet users. The whole range of potential business needs to be taken into account with a business’ e-commerce package. And that’s why the focus is on customization.

Sachin Singhal, e-commerce expert for Naaptol, underscores this in the Business Line article when he told them: “A mobile app is more user-friendly than having a WAP site. However, integrating the payment window with it makes the application complete.”

Host Merchant Services has been aware of this trend from its beginning. And that’s why the company offers powerful tools to its merchants that help them complete this integration –– giving them an across the board e-commerce solution that caters to mobile users and internet surfers alike. HMSPay and HMSExpress are both important elements that allow the company to capitalize on this trend and give online businesses the flexibility they need to cater to the huge growth happening in mobile payment sector.