1% and shutting down a recurring paysite
 

as has been pointed out the past couple of days, if you suddenly reduce your transaction volume you're going to run into problems - since cb% is caclulated from cb's several months previous, against the current month's number of transactions.

in light of this, any thoughts on ways to eventually phase out a recurring paysite without getting fucked?

besides selling it to someone that can market it at the same level?

yes.
stop new sales. i saw some amateurs site.....i thought she was snobby when i saw it, but i see it differently now.....on the signup page she posted that she wasnt currently accepting new members. that's one way to do it.

wtf?

stupid ho

I've seen one amateur site do that as well. She wasn't enjoying running her site anymore so she just phased it out. But I'm not sure what happened with her recurring.

uh, okay.

well, i think it's better than shutting down and telling everyone you found god and cant go on like this anymore :1orglaugh

you asked :glugglug

obviously you didn't understand the question lol

I had a friend who shut down her site. She had a few longer term memberships, and recurring. She cancelled all of the memberships, e-mailed the members, and kept up her updates until the last member was gone. Those with a longer term, she traded with other webgirls and gave them memberships at their sites.

:)
well, when you asked how to phase out a paysite without getting fucked by chargebacks..........i thought that is what you meant.

it's just something i saw and it popped into my head...im not saying it's a good solution or anything.

i fucked her.




p.s. i didnt understand the question either.

You could rework your site so that you could seamlessly show or not show the tour and join links based on the output of a random number generator. As you get closer to closing, the probability that a surfer will be able to join decreases. Just a suggestion, not sure how well it would fit in with your design. :2 cents:

sigh.

example:

if you did 6000 non-trial signups for June + 12000 recurs for June, and ended up with .5% chargebacks - this would work out to 180 chargebacks. however, like has been much discussed here the past couple of days, those 180 chargebacks will not be used to calculate the cb% for anywhere from 3 - 6 months.

3 months down the road you've killed all marketing and signups since June, and are simply running on recurring. let's say you're down to 6000 recurs.

the 6000 recurs (transactions) will be compared to the charge backs 3 months previous. 180 charge backs on 6000 transactions is a cb% of 3%. putting you well over threshold, and effectively losing your remaining processing, and your entire reserve.

no need to sigh :)

alright. heres a thought.....

one of the processors i was with had an option where you could limit the amount of signups to any given site.

so, let's say your getting that 6000 signups for the month...take that data and limit the amount of signups to say 5500 for the next month and just keep lowering it every month.

just a thought.

on 2nd thought....that would just create an endless cycle.

nevermind :(

i dont know quiet....it's a tough one.

we are so fucked.

Why the fuck would you shut it down instead of selling it off?

Next thread, "Does Anyone Know How To Burn A Suitcase Full Of Money Without Inhaling Any Smoke?"

What if you referred the new sign-ups to another page and use a processor like globill that has no fees . You can make the sign-ups non reoccurring if you were planning on phasing out the site at a given point..

yeah but money gets you so high.

I don't know about fucked but I would say it sucks.

I see two things happening, ez-clicks disappearing and trial joins being phased out.

Conversely, if trials disappear, revshare becomes more attractive than per signup. That has quite a few implications.

Just something to think about. :2 cents:

I don't see why you're so dead set on closing the site down and just selling the content instead of selling the site to someone.

You don't sell your Babys/Kids.


J.

note: i fucked up on the math - 0.5% on 18000 transactions is 90 cbs. going with the same number of recurring 3 months down the road (6000) you are still at 1.5% cb, and still fucked.

do you have all the customers cc#'s billing info etc? or is unkown sitting w an ibill or something ? if you have it we have a strategy that worked for us recently

First off, you'd be crazy not to just sell it.

Second - Visa WILL grant you an exemption.

Also, you have 90 days to get in compliance.

? Visa is going to grant ME an exemption?

lol.. Well maybe not, but the process is there. I don't know anything more than that they exist (exemptions that is.) And that you can possibly get one.

Edit: KK would be the one to ask about this, you know her number. ;>

I would like an answer from the billers. Is quiet right that, effectively, a site can never shrink unless you are willing to risk chargeback fines? This strikes me as very serious.

That is completely correct.

So many people responding in this thread are just skimming the question and thinking Quiet is asking "how can I shut down my site that has recurring members"... without understanding that less signups as you shut it down means a higher chargeback ratio.
A higher chargeback ratio means mega-fines from Visa and possibly losing your processing ability forever (they don't call it the TERMINATED merchant file for nothing).

The folks who have done it over the past year, past few months, etc - probably were not using their own merchant account, and most definitely did not have to deal with a 1% chargeback limit.

Take Quiet's numbers. You could do it within the current 2.5% limit, if your numbers were what he displayed and you evened out around 1.5%. You've still got plenty of breathing room.
But as of October, 1.5% means you're over the limit.

Quiet, it looks like you might have to get out of the biz earlier than you planned. You were planning October, right?
The only way I can see doing it is to completely forget about the recurring $$ and simply turn off everyone's membership on the same date. Stop taking new signups one to two months before, with a big note on the site that you'll be closing on X date, and then on X date shut everything down and walk away.

Or just sell it and let some other schmuck have to worry about never being able to get smaller.
This is just friggin insane.

That is insane. Nobody with a site based on personal content can ever retire? (After all, when I stop doing this, nobody else can really take over my sites... same with amateur sites.)

What I've decided to do is gradually lower the sign ups, in parity with the cancellations. Only option really.. unless you just want to stop all together -- You will get about 3 months of recurring before you get shut down.

I thought that was what you were getting at, and yes that is truely a difficult obstacle to get around...

would the use of some throw away merchant accounts work? ie, as processing shuts down for one, you rotate to the next, or will all rebills die with processing company #1?



I think the trick is to find out how to carry your recurring's with you to other processing points if possible....if that's not doable, then HMMM, I'm wicked stumped...

only other route I could think of, is if your recurring puppies are active-recurring people, then just email blast them to your new processor to stay on with the site...and play that out until it winds down the point you're willing to cut rope....


ride the wave until it dies and then go get the next golden egg ;)

With VISA, a URL gets blacklisted.. irrespective of merchant account.

Well, here's how it boils down.

A merchant account holder who is in the high risk category has 0 chances to screw up without being penalized. The first time they go over 1% they are fined $100 per chargeback with no warning and no grace period.

If I were an IPSP I would seriously consider holding my clients to the same standards regardless of whether or not I were in fine trouble. Now we all know that I am not an IPSP so it's not necessarily going to happen that way, I'm just saying that it could.

If you decide to close down a site, the only real option in the current climate is to shut it down in a 30 day period IF your processor decides to implement the fines in the same way that they are assessed to them. If you have your own merchant account, you really have no choice since you will not be able to stay out of fine trouble as you ramp down most likely and then you'd come to a point where you were being fined the $100 per chargeback.

You stop taking new members, you stop rebilling old members, you put up notices all over your site that at such and such date there will be no more site and the rebills will stop. This way the only thing you risk is your reserve basically.

You simply can't have your cake and eat it to in this situation, Visa is not going to allow it.

Yes, and no. A URL can be allowed processing under certain circumstances, tho it's previously been at teh discretion of the acquirer and ultimately Visa.

but checks are still fine right? maybe instead of just stopping sign ups.. only allow checks or something :(

Ugh, does this topic give anyone else chest pain?

Brad

Rumors abound... 2% 'chargeback' rate for checks coming down the pipe from the Fed...

I DO NOT know that it is true, just that I have heard it.

I think I dislodged a chunk of sausage from an artery.

Why? Is this really about getting rid of fraud or is this about taking down certain online merchants? It seems like they are trying to find ways to put adult out of business rather than finding ways to make the system work.

sounds like visa is forcing porn sites to keep running at full throttle...

No I don't see it as a way to keep an industry down. I see it as teh Federal Reserve system getting fed up with processing thousands upon thousands of fraudulent online checks that don't clear, waste their time and resources, and should be kept in check.

Shifting cc processing to check processing to beat the system is not the answer.

Hmm. Never thought about that before. Now ain't that a bitch.

It's not just adult that is making these changes. It is the entire online payment system. Think about it.

You've told us everything except the solution, Oracle.

Where are we 5 years from now? Who jumps in and innovates online payments? Does anyone?

Just lowering the allowed numbers, like V/MC is doing, is not a solution. Online fraud is a reality - it exists. Making arbitrary rules doesn't change reality. Where is it all heading, in the long run?

I'm supposed to give you a solution within 36 hours of hearing this, and for free?

;-}}}}

I bet you've been thinking about it long before it happened. As far as the free part, you got me there. :)

As much as I'd like to claim to be Ms. Cleo, I didn't have a clue this was coming and I don't think the IPSPs did either.

One of those shot in the dark, right thru the heart things.

But the longer I think about it, the better it sounds.