BackerKit Part 3: Conclusions and Recommendations
almost 2 years ago
– Fri, May 20, 2022 at 03:44:16 AM
This update is about physical books and the BackerKit beta program we’re using for charging shipping later. Backers who are only ordering pdfs aren’t affected by anything in this update.
Issue
As you might know from previous updates, the issue at hand is that BackerKit’s “Charge Shipping Later” program asks for credit card information and treats that as an authorization to charge the card once the shipping fee is determined. They send a notice of the amount before charging the card, but unless the backer contacts backer support within that time frame, the card is charged. This was not how we understood the program to work (details about how that happened are in earlier updates).
Summary
1) With reservations, we’re going to stick with BackerKit unless something further happens. This is based on our analysis that the risk can be adequately contained (see below), weighed against the considerable difficulty and possible new problems involved in switching fulfillment methods mid-stream. It’s important to keep in mind that if shipping prices don’t rise dramatically, this is basically a non-issue in financial terms.
2) We are, however, going to continue to request from BackerKit that when the time comes, our backers are asked to approve the charge for shipping based on the amount. There is a “back door” way of achieving this already, which we’ll discuss, but we would prefer to have it work as part of the process.
3) As a matter of helping to improve the marketplace for gaming products via Kickstarter, we are going to advise BackerKit that the design of this entire program is much less attractive to backers than they seem to believe. Organizing the program the way we thought it was organized (i.e., with something like a “second survey” at shipping time) should be considered by BackerKit as a better way of setting up their “Charge Shipping Later” program. At some point, this program as it’s currently organized is going to encounter the perfect storm of circumstances, and the alternative method is far more likely to weather that storm.
4) At the end of this update, we have some guidelines for different groups of backers to manage your concerns about the way BackerKit will charge cards.
Analysis
We spent most of yesterday talking with people at BackerKit, and also reviewing various options up to and including switching from BackerKit to a different fulfillment/payment system. Fulfillment on a large Kickstarter is an integrated process. As one example, the fulfillment warehouses we’re using in the UK and the USA were selected in part because they have a lot of experience using BackerKit’s data-output to produce an accurately packed box with a correct shipping label on it. The sheer quantity of data involved in a Kickstarter with thousands of backers makes it difficult to switch from one overall fulfillment method to another. So, we decided early in the process yesterday that trying to “fire” BackerKit would be a last resort, to be employed only if we decided that the potential risk to backers was very high. Having made that decision we reviewed what we know from emails and documentation, to understand what risks backers might face, and when those risks would occur.
First of all, if shipping rates don’t increase tremendously between now and roughly November, this is a complete non-issue other than potentially as a matter of principle. Backers expect to pay for shipping; backers of this Kickstarter have even accepted that the shipping may be higher than it was when they pledged. The problem only arises if there is such a large increase in shipping prices that people would legitimately decide to abandon a pledge rather than pay the additional shipping amount. At this point in time, we still see this as possible, but not as probable. We launched this Kickstarter in the early days of Russia’s invasion of Ukraine, when the risks and results of that invasion were unknown. Now it appears that inflation is roughly topping out and becoming a known quantity, and oil supply (which is probably the largest risk for shipping costs) is adapting to the dislocations in production and transportation. Our projection is that while BackerKit shouldn’t organize their program this way, we’re not likely to encounter the scenario where it’s a problem.
Also, specifically for backers in the USA, since this is media-mail eligible and the book is printed in the USA, the risk is quite limited since media mail is inexpensive (relative to priority mail) in the first place. Even a large jump in percentage rates wouldn’t lead to much additional cost in dollar terms, relatively speaking.
Moving Forward
The Existing Back Door: Once we ascertain the shipping rates, BackerKit will contact you via email to give you that information, and you will have 48 hours (as it’s currently set) to contact BackerKit support if the shipping rate is so high that it causes an alarm bell to ring. Here is a quote from a BackerKit email to us yesterday describing this process:
“The only difference with our process for the beta feature in order to streamline the backend is that we charge cards after 48 hours since the email notification with total due amount for shipping is sent to each backer. We have found that 48 hours is a reasonable amount of time to give backers a heads-up and opportunity to reach out to our Backer Support if they need order adjustments. But if you feel strongly about waiting 3, 4, 5 days after the email to charge cards, then I can ask for an exception but I can't promise anything until I talk to the product manager who's leading this effort. The actual action of charging cards for the 2nd time for shipping fee is a staff only feature at this moment.”
We need to clarify with BackerKit what “order adjustment” means, but it appears that this is the way to veto a charge to the credit card. It’s not optimal, because it requires seeing and responding to the email, but it’s better than nothing. As noted above, we’re going to request that a form of active approval is required, but we don’t know if we’ll be able to get BackerKit to agree to that. However, once we hit this point (shipping prices known), we, meaning Mythmere Games, will also be doing updates and informing backers that this email from BackerKit is on the way, plus we’ll know at that point whether the shipping prices are likely to be a problem for people or not. If they are only 5% higher than they are now, it won’t be an issue, but it they are 50% higher we’ll absolutely know that lots of backers may need to opt out.
What to do
If you are a PDF-only backer: no action needed
If you are in the USA and have given BackerKit your credit card details: since your financial exposure is limited, this being printed in the USA and planned to ship as media mail, this might not be an issue for you, in which case, no action needed. If you are on a tight budget or if you object in principle to the way the program works, we suggest that you contact BackerKit’s support team ([email protected]) and ask how to ensure that your card is not charged without your permission. The first answer is likely to resemble the quote above, but if lots of people ask the question, BackerKit will begin to focus on it more.
If you are in the USA and have NOT given BackerKit your credit card details: it’s still worth deciding whether this is even an issue for you. If it is, you have an additional option, which is to ignore BackerKit’s requests for the credit card information until you receive the notification of the shipping charge, at which point you can decide whether to give them the information or not. This is likely to entail numerous "reminders" from BackerKit that you haven’t given them the CC information yet, which is why we suggest deciding whether you actually care about it.
If you are not in the USA: The options are the same for non-USA backers, but the difference is that international shipping charges are more likely to increase than the shipping charges entirely within one country. If you have not given BackerKit your CC information, you can wait to do so, as described above for the Americans. If you have already given BackerKit your CC information, you can contact their support team ([email protected]) and ask how to protect yourself against an unexpectedly large charge.
Conclusion
We are going to continue to lobby BackerKit to either offer us an exception (create an opt-out) or, preferably, change the procedural flow of the entire beta program in a way that requires backers to affirmatively approve a shipping charge rather than requiring action to prevent it. They have not encountered many complaints about this program in the past, which we think is probably because (a) people didn’t know it was functioning in this way, and (b) the “perfect storm” that will cause a problem hasn’t happened to a Kickstarter yet. When it does, the problem in the system will become visible. On the other hand, there are almost certainly factors involved that we don’t know about: credit card laws, costs of processing credit cards, and balances of the interests of the Kickstarter campaign versus the interests of the individual backers. We don’t think BackerKit is being deceptive here: as mentioned before, they are trying to meet the needs of Kickstarter campaigns in the best way possible. We just think that they have selected a model for “Charge Shipping Later” that is at some point going to encounter just the wrong set of circumstances, with bad results.
BackerKit Part 2
almost 2 years ago
– Fri, May 20, 2022 at 03:24:06 AM
We have discovered that there is a fundamental misunderstanding between BackerKit and Mythmere Games about how the beta “Charge Shipping Later” program will operate. We are working to resolve the matter, but in a nutshell, BackerKit is currently asking backers (of physical books only) for a pre-authorization to charge an as-yet-unknown shipping amount. Our understanding of the program was that once we ascertained the shipping prices, backers would receive effectively a “second survey” to confirm shipping address, give the price for the address in the books, and authorize a charge to the credit card for that amount (or change the address, then pay).
The source of the misunderstanding is that when we created the survey, BackerKit hadn’t activated it with the beta program in place; we were creating and reviewing a normal survey despite the fact that BackerKit had given us some questions based on the fact that it was supposed to be a “Charge Shipping Later” survey. The crux of the matter is that when we reviewed it, if the program had been activated it would have shown us the language in which BackerKit requests the charge authorization. Since it wasn’t activated, there was no request for authorization (because Kickstarter had already received the payments). Based on our assumption that the authorization would be requested later, this didn’t seem odd. That question would come up in the later communication from BackerKit when the shipping prices were known.
This isn’t a matter of deceit by BackerKit, we want to make clear; it’s an ordinary miscommunication about how the beta program would work, reinforced by a minor error (not having the program activated when we created the survey). It makes sense from their perspective because there’s a downside to the way we thought it would work; if it’s done the way we thought it worked, there would be a lot of backers who backed the Kickstarter but didn’t want to pay the shipping charges, so there would be partial refunds or store credit to handle that situation. Nevertheless, the point where the miscommunication should have been resolved – our preview of the survey – didn’t resolve the miscommunication because the survey didn’t have the right pre-sets enabled.
Hopefully, BackerKit will be able to restructure this process, but we don’t know yet. If they cannot, we will need to decide whether to go forward with “blank check” shipping or whether to assemble an alternate way of receiving payments for shipping from a very large number of people.
This doesn’t endanger the Kickstarter’s delivery in any way. It might make fulfillment more complicated than originally foreseen, if we decide we need to create an alternative process, but it won’t cause anything more serious than possibly a delay in getting the orders paid for and out the door.
We will keep you posted.
