Credit Card Payments Don’t Have To Be Scary

A favorite topic among media financial professionals, particularly those involved with credit and collection, is credit card acceptance. Unfortunately, credit cards have also become a trending topic in the popular press for very different reasons.

Credit card information breaches number among a long list of things to be afraid of, not only at Halloween, but all year. Companies named as sources of these breaches face fines as well as serious damage to their reputations.

There is a significant risk to your station’s ad sales program if you don’t accept credit cards for advertising or others types of purchases. As one participant in an MFM/BCCA forum discussion on this topic observed: “Reality dictates the course when discussing credit cards; unless you are a ‘must buy’ it is difficult to insist we do not accept credit cards.”

Other participants in the forum, including Michael Denson, vice president of the media division at debt collection agency HRI Consulting Group, point out that there are also a number of rewards for stations that offer this payment option to their customers. Chief among them is the opportunity for “immediate cash.”

MFM’s BCCA subsidiary, the media industry’s credit association, has found that roughly half of our members already accept credit cards. Credit cards can be a very effective means for securing the down payment portion of a major media purchase. On the collections side, securing a credit card payment can be a great way to secure payment from a past due account. Members are also finding the ability to accept payment via the purchaser’s credit card can help to reduce the time and processes required for getting a check cut by the accounts payable department.

Traditionally, it was the added expense of processing fees that discouraged organizations from accepting credit card payments. While it may seem counterintuitive to the focus on reducing data breach risks, one of the ways to cut processing fees is by collecting and sharing more customer data with credit card companies.

As outlined in an earlier Front Office column, MFM/BCCA member Raycom Media substantially reduced its processing fees by moving most of its transactions from what MasterCard and Visa call ‘Level I’ to the much more cost effective ‘Level II’ or ‘Level III’ payment tiers when a commercial, corporate, purchasing, business or government card was used for the payment.

The media industry’s “reality,” as pointed out by our forum participant quoted above, seems to be the reality in other industries too. Despite the ongoing focus on data breaches, a recent survey by Credit Today magazine shows that credit card acceptance has continued to grow among B2B firms and an increased percentage of customers are paying by credit card.

Media companies can expect the number of customers preferring to pay by credit card to continue to increase. As the MFM-Borrell Benchmarking Local Media’s Digital Revenues report found, small and medium-size businesses (SMEs) represent the biggest growth opportunity for local media sales. In addition to looking for options such as programmatic exchanges for media buying, they will want to take advantage of electronic solutions that make it easier to pay for their media purchases.

So how do you take the scare out of accepting credit card payments?

As Denson noted in our discussion forum, it begins by ensuring compliance with the practices required by the Payment Card Industry (PCI) Security Standards Council. These rules set out exactly how merchants are expected to protect their customer’s credit card data. According to the Council: “The keystone is the PCI Data Security Standard (PCI DSS), which provides an actionable framework for developing a robust payment card data security process — including prevention, detection and appropriate reaction to security incidents.”

To be really vigilant, companies must treat compliance with these rules as part of a broader focus on data security practices. The PCI Council’s new GM, Stephen Orfei, a tech industry veteran with experience in telecommunications, emerging payment technology, and cyber security, recommends taking these additional steps:

• Improve the way you monitor your network and data resources to stay on top of incoming threats.
• Adopt patch management practices, such as designating a “PCI champion” who is responsible for keeping business systems current with the latest patches and updates, as well as for considering the security impacts of changes to websites and physical points of sale.
• Invest in security systems; EMV (chip cards) and technology like point-to-point encryption and tokenization are becoming more accessible, affordable and usable, and can help to make data worthless to attackers.
• Make security a key performance indicator, not just in IT but across the business in order to develop a culture of security. This includes ensuring each person who interacts with sensitive data, or the systems that handle it, is educated on common hacker tactics hackers.
• Remember that compliance is just a point-in-time metric; remain vigilant with risk reduction even when the assessors are gone.

PCI experts also say it is important to avoid storing payment information whenever and wherever possible. “Businesses that store payment information, either in hardcopy or electronic form, are putting themselves at a much more significant risk for breach,” observes Chris Bucolo, who serves as senior business development manager for PCI’s Controlscan security compliance unit.

Of course, management of credit card data is only a piece of the credit card discussion at media companies these days. Other topics include the types of clients eligible to use these cards; when to offer the credit card option; and whether credit card payments, which can be disputed after the customer receives the statement, can truly be considered cash-in-advance.

BCCA members and their advertisers will certainly be continuing the credit card discussion at the upcoming BCCA Media Credit Seminar on Nov. 6, at the McGraw-Hill Building in New York City. This annual event, which brings together credit and collections experts from across the country, is a unique opportunity for media company representatives to share insights on ways to improve both the quality of service they provide to their advertiser customers and the financial performance of their credit departments.

Digital is a big topic for this year’s event, which will include a presentation on “Digital Changes, Where are We at Today and Where are We Going?” by IAB’s Patrick Dolan; a discussion on “Going Paperless” and two sessions addressing digital sales. The first to be led by Jon Sumber, VP, digital sales, Hearst Television, will look at the topic from the media industry perspective. The second will provide agency and advertiser points of view.

We will also provide an update on EMCAPP, BCCA’s Electronic Media Credit Application, along with presentations addressing the economic outlook, leading a multi-generational workforce, and an update on legal issues affecting media credit.

More information about the BCCA Media Credit Seminar may be found on BCCA’s website, http://www.bccacredit.com. As we learned from the experts’ insights concerning credit cards, the right knowledge can help us to ensure that the future, like a good Halloween, offers many more treats than tricks.

Mary M. Collins is president and CEO of the Media Financial Management Association and its BCCA subsidiary. She can be reached at [email protected]. Her column appears in TVNewsCheck every other week. You can read her earlier columns here.