Case Study: How MidArmor Reduced Chargebacks by 95% for an E-Commerce Brand
Chargebacks can be one of the biggest headaches for e-commerce brands, draining revenue, straining customer relationships, and threatening vital payment processing partnerships. For many fast-growing online retailers, managing disputes often feels like an uphill battle with no clear path to lasting solutions. But what if there was a way to slash chargebacks by more than 90%, recover lost revenue, and streamline dispute management all at once? In this case study, we explore how MidArmor partnered with a thriving health and wellness e-commerce brand to do exactly that — transforming their chargeback challenges into a story of remarkable success.
Background
This case study features a fast-growing e-commerce brand in the health and wellness sector. Despite rapid success, the company faced a growing problem with chargebacks (averaging about 100 per month), which led to revenue loss, operational strain, and pressure from payment processors. The company’s model, based heavily on subscriptions and digital marketing, made it vulnerable to friendly fraud, billing disputes, and fulfillment-related complaints. These issues not only drained resources but also threatened its merchant standing.
Profile of the E-Commerce Brand
- Type of products/services: Supplements, skincare, and functional foods
- Size of operations: U.S. and international shipping with in-house and 3PL fulfillment
- Monthly transaction volume: Over 20,000 orders
- Target customer base: Health-conscious millennials and Gen Z consumers, especially subscription users
To address the chargeback crisis and regain control over dispute management, the company turned to MidArmor for a scalable and automated prevention solution.
Challenges Faced
Before partnering with MidArmor, the e-commerce brand faced a range of operational and technical issues that made managing chargebacks difficult and costly. These challenges contributed to lost revenue, increased internal workload, and heightened risk with payment processors. Key challenges included:
- Lack of real-time dispute resolution tools. The company had no ability to detect or address disputes before they turned into chargebacks, resulting in a consistently reactive approach.
- Inaccurate fraud flagging and excessive false positives. Fraud detection systems failed to catch real threats while wrongly rejecting legitimate transactions, hurting both revenue and customer trust.
- Gaps in communication with payment processors. Limited visibility into dispute cases and chargeback trends made it difficult to act quickly or comply with evolving processor requirements.
- Inefficient fraud prevention and chargeback response workflows. The team relied heavily on manual reviews and outdated procedures, which slowed down resolution times and strained internal resources.
These ongoing issues highlighted the need for a smarter, automated solution—prompting the company to seek support from MidArmor.
Why MidArmor Was Chosen
After evaluating several chargeback prevention providers, the company chose MidArmor for its ability to deliver fast, measurable results through intelligent automation and seamless integration. The decision was driven by both immediate needs and long-term growth goals. Key reasons for choosing MidArmor included:
- AI-powered dispute prevention. MidArmor’s real-time risk scoring and predictive analytics (Verifi and Ethoca) enabled early identification of potentially risky transactions and disputes.
- Automated response system. The platform generated and submitted evidence packages automatically, improving win rates while reducing the burden on internal teams.
- Seamless integration with existing systems. MidArmor easily connected with the company’s CRM, payment gateway, and customer support tools, minimizing onboarding time and complexity.
- Support for pre-dispute tools like Verifi and Ethoca. The company could now resolve disputes before they became chargebacks, protecting revenue and maintaining processor compliance.
- Proven expertise and responsiveness. MidArmor provided a dedicated support team, timely insights, and actionable recommendations tailored to the company’s specific needs.
The company saw MidArmor not just as a vendor, but as a strategic partner capable of delivering long-term value and stability in a high-risk payment environment.
Solutions Provided
MidArmor implemented a comprehensive suite of tools and strategies tailored to the company’s operational model and chargeback vulnerabilities. These solutions targeted the root causes of disputes and introduced automation to minimize both fraud and manual intervention. Together, they created a proactive ecosystem that significantly reduced chargebacks and improved overall transaction integrity.
Key solutions and their impact included:
- Real-time transaction monitoring and risk scoring. MidArmor’s AI analyzed customer behavior and transaction patterns to flag high-risk purchases instantly. This allowed the company to block or review suspicious orders before fulfillment, preventing many potential chargebacks at the source.
- Automated chargeback response system. When disputes did occur, MidArmor generated and submitted customized, evidence-rich responses based on order data, shipping records, customer communication, and more. This automation not only increased win rates but also drastically reduced the workload on customer service and finance teams.
- Integration with pre-dispute networks (Verifi and Ethoca). By participating in these pre-dispute platforms, the company could resolve complaints in real time, often issuing refunds or clarifying misunderstandings before they escalated into formal chargebacks.
- Dynamic fraud prevention adjustments. MidArmor continuously optimized fraud rules using performance data. This reduced false positives and improved the customer experience while tightening defenses against true fraud.
- Detailed analytics and reporting dashboards. With better visibility into chargeback sources, product-specific risk trends, and customer dispute behavior, the company was able to make informed decisions on everything from product descriptions to billing practices.
Through these combined efforts, MidArmor helped the company cut its monthly chargebacks by over 95%, preserve merchant account stability, and recover thousands in previously lost revenue. More importantly, the business was able to shift from fighting fires to growing confidently with a more secure payment infrastructure.
Results Achieved
The partnership with MidArmor delivered transformative results that exceeded the company’s expectations and fundamentally improved its chargeback management.
- The company reduced its monthly chargebacks by over 95%, dropping from around 100 chargebacks per month to fewer than 5
- This dramatic decline led to significant revenue recovery, as fewer disputed sales meant more retained income
- The automated dispute response system lowered the manual workload, allowing customer support and finance teams to focus on growth initiatives rather than time-consuming dispute management
- Improved transaction monitoring and fraud prevention enhanced the overall customer experience by reducing false declines and increasing trust
- The company regained and maintained a strong standing with payment processors, avoiding penalties, higher fees, and potential account holds or terminations
- With detailed analytics and reporting, the company gained valuable insights that informed smarter business decisions and helped prevent future chargebacks
These results not only stabilized the company’s financial health but also provided a scalable foundation for continued growth and customer satisfaction.
Final Thoughts
In summary, the partnership with MidArmor proved to be a game-changer for the e-commerce brand, turning a costly and time-consuming chargeback problem into a manageable, nearly eliminated risk. By leveraging advanced AI-driven tools, real-time monitoring, and automated dispute resolution, the company not only reduced chargebacks by 95% but also strengthened customer trust and preserved crucial payment processor relationships. This case demonstrates the power of proactive, technology-driven chargeback prevention, offering a clear roadmap for other online retailers looking to protect their revenue and scale confidently in a competitive market.
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