When someone places an order in your eCommerce store, they have to confirm two addresses. You need their shipping address and also the billing address for their payment method. These two addresses may be exactly the same. Or they may be slightly (or completely) different. Understanding the purpose of each will help you ensure accurate shipping.
The difference between shipping and billing address
A shipping address is an address where you or your 3PL will send the order. The billing address is the address connected to the customer’s payment method. Billing and shipping addresses are often the same – but not always.
There are several reasons you might find a difference between shipping address and the billing address.
- The order is a gift. Some customers would like their orders shipped directly to someone else. The person at the billing address is different from the person at the shipping address.
- The customer’s proper mailing address is formatted differently from the address on file with the credit card company. This is often a small difference, such as “Unit” instead of “Apartment.”
Some merchants require the same shipping and billing address for online orders. This is most common with high-value items that may be tempting targets for credit card fraud. Fraudulent transactions in online shopping can be costly for eCommerce merchants. Adding fraud detection apps to your eCommerce platforms can separate suspicious transactions from customers with legitimate payment methods. Billing addresses help with this verification.
Why it’s essential to get shipping and billing addresses right.
If the billing address is entered incorrectly, the charge won’t go through. Payment software will flag this issue so the customer can correct it. Matching the billing address to the address on file a way to confirm that the customer is an authorized user of the payment method.
Sometimes, a customer accidentally enters their shipping address as their billing address. In that case, the transaction won’t go through unless the shipping address and billing address are precisely the same.
Shipping address errors can be harder to detect. They can happen during the purchase if a customer mistypes their address. Shipping address errors can also occur during sending the order. Shipping errors are costly. You may get the order back and have to reship. Or it can get lost and not delivered. In that case, you may need to send a replacement.
Troubleshooting billing address errors
If a payment system rejects a billing address, there are several possible reasons.
- The customer entered something incorrectly. Review spelling, street numbers, and zip code. The billing address must match the address on file for their form of payment.
- Information was entered on the wrong line of the form. This doesn’t have to be a significant error, like accidentally entering the state where the city should be. Putting the apartment number on the wrong line can cause a billing address failure. Some systems require the unit number to be entered on the second address line. Only the street number and name go on the first line.
- The credit card company’s information doesn’t match the customer’s information. Billing address errors can crop up if you moved or changed your name recently. If the credit card processor doesn’t have the new information, the address may be rejected.
You may need to contact the credit card company to resolve some address errors. However, most billing address issues can be fixed by checking and retyping the address.
Types of shipping address errors
Shipping address errors range from minor typos to zip code mistakes. The amount of hassle these errors cause can vary widely.
For example, a transposed letter in a street name (Grene instead of Green, for example) might not affect whether a package is delivered. As long as the rest of the shipping address is accurate, the order should arrive safely at the customer’s home. An error such as 123 Green Street instead of 321 Green Street, however, can send your package to the wrong house. That could result in a return or a lost order.
Zip code errors can cause even bigger headaches. For example, 37914 is in Knoxville, TN. But 31794 is in Tifton, GA, almost 400 miles away. Zip code errors such as this can delay delivery times. Worse, the package might be returned as undeliverable.
Billing Address Vs. Shipping Address FAQ
What Is Billing Address?
The meaning of a billing address is the address that a customer used to establish the payment method (i.e. credit card or debit card) that they are using to pay for the service or product. Billing and shipping addresses can be the same, such as when someone uses their home address to apply for a credit card, and then want products they buy with the credit card sent to their home address (shipping address). The billing address would be different if for example a customer has set up their home address as their billing address, and then wants to ship to a different address (such as when gifts are sent, or when people want products sent to an office or second place of residence).
How Do I Know My Billing Address?
As a default most people would establish their billing address using their home address, but if someone wants to double check and to know for sure what their billing address is, simply login to the credit card account or payment method being used at the store requesting the billing address, and look in account settings to see what address is there on file.
What Is a Billing Zip Code?
The billing zip code is simply the zip code portion of the address that was used to set up the payment method being used to purchase goods or services at the place of business requesting the billing zip code. Gas stations may require customers to input their billing zip codes after inserting their credit cards into the gas pump machines to verify that the credit card is not stolen.
Does Billing Address Matter?
Yes, it matters what billing address you enter, because this is the way a merchant can verify that your payment method is being used legitimately. Merchants ask for billing addresses as a precaution against possible credit card theft. Would-be thieves who may want to use a stolen credit card may be detected when the billing address does not match the one on file. Consequently the order cannot be processed.
How to ensure your orders get billed and shipped correctly
Fortunately, there are many software solutions to verify and correct shipping addresses. You can include address verification at checkout. It’s a good idea to do a second round of verification when you are ready to send the order. Address verification apps match shipping addresses to the USPS address database. A best practice is to check the shipping address at checkout and again before you ship the order.
Make sure your 3PL company uses address verification software to ensure that the packages they ship arrive safely. Red Stag Fulfillment guarantees accurate shipping, or we pay for reshipping, plus we pay you $50. We rarely have to pay the $50 because our failsafe systems catch most shipping address errors before the order leaves our warehouses.
