Chargeback Crisis: How Much are Subscription Services Losing?

Chargebacks, once a minor inconvenience, have grown into a billion-dollar issue, especially impacting subscription-based services.

October 25, 2024

šŸ“¢ Hey, Retailist Roundup readers! As the weekend approaches, letā€™s dive into the latest buzz in retail and e-commerce!

News from Retailist

Chargebacks, once a minor inconvenience for businesses, have evolved into a billion-dollar problem, hitting subscription-based services particularly hard.

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In the news: Top headlines this week

McDonald's US head vows to improve safety after E. coli outbreak, more cases expected. McDonald's pulled its Quarter Pounder burgers from menus in a dozen states after an E. coli outbreak, linked to the item, killed one person and sickened nearly 50. The outbreak, affecting the U.S. West and Midwest, has hospitalized 10 people. The CDC is investigating. [Reuters]

Unilever's pricing shift may have attracted shoppers in third quarter. Investors are closely watching Unilever's third-quarter results on Thursday to see if the company has regained market share lost to cheaper competitors, as it tries to balance sales volumes and margins. Unilever, like others in the packaged food industry, raised prices due to cost increases during the pandemic and higher grain and energy prices following Russia's invasion of Ukraine. [Reuters]

Wayfair launches paid loyalty program. Wayfair has introduced a new $29 per year membership loyalty program across its brands, including Wayfair, AllModern, Birch Lane, Joss & Main, and Perigold. Members receive 5% back in rewards on all purchases, early access to major sales events, free shipping on all orders, and other perks. Rewards do not expire as long as the subscription remains active. [Retail Dive]

Retail inventories in good shape for holidays: NRF CEO. National Retail Federation President Matthew Shay reported that retailers are well-prepared for the holiday shopping season with sufficient inventory. Despite a brief strike by the International Longshoremenā€™s Association, retailers had planned ahead and staged inventory, and Shay noted no expected impact on the holiday season from the work stoppage. [Retail Dive]

Shares of Peloton surge 11% after David Einhorn says stock is significantly undervalued. Peloton's shares rose over 11% on Wednesday after Greenlight Capitalā€™s David Einhorn described the company's stock as significantly undervalued during the Robin Hood Investors Conference, where he made his case while riding a Peloton bike. Although it was unclear what he believed the shares should be worth, Greenlight Capital disclosed a $6.8 million stake in Peloton as of June 30. Peloton's stock has been volatile and was up just over 1% for the year as of Tuesday's close. [CNBC]

Starbucks shares slide after coffee chain says sales fell again, suspends outlook. Starbucks reported preliminary quarterly results on Tuesday indicating a continued decline in sales as the company works on a turnaround strategy. CEO Brian Niccol emphasized the need for a fundamental change to return to growth through the "Back to Starbucks" plan. He plans to provide more details on this strategy during the earnings call on October 30, focusing on reversing slowing demand, particularly in the U.S., its largest market. [CNBC]

Job Board: This weekā€™s Top Openings in DTC, RetailTech, and more

Want to submit a role to our talent board? Email [email protected].

  • Sr. Category Manager (Rogers, AR) Mondelēz International - more here

  • Senior Partner Sales Manager, Retail Media (Boston, MA) Mirakl - more here

  • Sr. Marketing Associate, Paid Media (Hiring Remotely in United States) Brilliant Earth - more here

  • Regional Director, Southeast (Hiring Remotely in Tallahassee, FL) Green Thumb - more here

  • Head of Content (Hiring Remotely in Los Angeles, CA) Golden Hippo - more here

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