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Why are refunds expected?

by Andy Money
31 replies
Just curious about this, love to get a conversation going. What do you all think of this? 99% of the time I've given refunds (in the IM niche, all other niches, etc.), but a few times I even held WSOs where I explicitly didn't offer one (partially to see what would happen), my result? Sales were better than when I offered a full refund.

I don't really have an explanation for this either, it's just really, really interesting. It seems to be a controversial thing to NOT offer a refund, but no matter where you go in the "real" world--you run into all sorts of situations where you can't simply just return something, even if it's a physical object (and we're dealing in ELECTRONIC goods here, something that makes scamming/stealing so easy).

So anyway, just curious on everyone's thoughts, I think I'll get a mix of different responses to this
#expected #refunds
  • Profile picture of the author sahi
    To be honest I'm totally against this refund thing as I've seen and experienced myself how some people take advantage of this offer and scam you.

    I don't offer refunds in all of the niches that I target and so far I didn't have any complaints against my products keeping in view the feedback that i get from my customers, and I've been selling them for couple of years. But in IM I've seen this refund phenomenon more prevalent than in any other niche, and is more often propagated and preached by marketers, and is followed by those who just agree for the sake of agreeing.

    If all of us today decide not to offer refunds in our sales letetrs I bet sky won't fall on us and it won't be the end of the world.
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    • Profile picture of the author Andy Money
      Originally Posted by sahi View Post

      I don't offer refunds in all of the niches that I target and so far I didn't have any complaints against my products keeping in view the feedback that i get from my customers, and I've been selling them for couple of years. But in IM I've seen this refund phenomenon more prevalent than in any other niche, and is more often propagated and preached by marketers, and is followed by those who just agree for the sake of agreeing.
      Absolutely agree with that. In another niche I'm in I've had virtually NO refunds, even though I openly offer them. Any given WSO or IM product where I don't even advertise a refund policy? 25% or more refund rate in a lot of cases, it's pretty amazing. I think it's interesting because if you OFFER a refund, you're going to attract people who feel entitled to a refund under any circumstance what so ever--which is going to shoot your refund rates through the roof.

      Personally (especially in the IM niche) when I purchase a product, I feel zero entitlement to a refund, I just assume the risk of the purchase to be quite honest. That being said I've bought products from VERY big names and been VERY disappointed.
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  • Profile picture of the author Brad Gosse
    Refunders will chargeback if you don't attend to them.

    Having said that try and purchase software from best buy, unwrap and return. not gonna happen.
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    • Profile picture of the author Andy Money
      Originally Posted by Brad Gosse View Post

      Refunders will chargeback if you don't attend to them.

      Having said that try and purchase software from best buy, unwrap and return. not gonna happen.
      This is the kind of stuff I'm talking about. Hahah. The interesting thing is that the people who do charge backs, in my experience, never even ask for a refund to begin with.
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      • Profile picture of the author Brad Gosse
        Originally Posted by Andrew Maule View Post

        This is the kind of stuff I'm talking about. Hahah. The interesting thing is that the people who do charge backs, in my experience, never even ask for a refund to begin with.
        Last guy who filed a paypal dispute with us said "I figured I would get your attention faster this way than email"

        It's ignorance on one hand. Learned behavior on another, some marketers have been poor with their customer service. We all pay that price.
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    • Profile picture of the author Alexa Smith
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    • Profile picture of the author seasoned
      Originally Posted by Brad Gosse View Post

      Refunders will chargeback if you don't attend to them.

      Having said that try and purchase software from best buy, unwrap and return. not gonna happen.
      Have you EVER been to a bestbuy and not had your card swipped? It is HIGHLY unlikely! Have you ever purchased more than say $30, and not signed? Did you ever not give them proof of delivery?

      Frankly, each of those things make their case stronger, and they RARELY apply to downloaded things. Still, you can get a chargeback.
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  • Profile picture of the author Daniel E Taylor
    give refunds to whoever asks for them.

    Less headache.
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    • Profile picture of the author Brad Gosse
      Originally Posted by Daniel E Taylor View Post

      give refunds to whoever asks for them.

      Less headache.
      Thats not really the discussion here.
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      • Profile picture of the author Andy Money
        Originally Posted by Brad Gosse View Post

        Thats not really the discussion here.
        Exactly. Plus, that seems to be the problem, people take that attitude and then it just feeds itself (while refund rates would climb as more and more people realize they can just buy something and request a refund). I've had to go through a charge back before with a company and it wasn't easy or fun, so if you get rid of the refunds on digital products in your niche, charge backs really aren't that easy of an option for most scammers--IMO.
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        • Profile picture of the author Brad Gosse
          Originally Posted by Andrew Maule View Post

          Exactly. Plus, that seems to be the problem, people take that attitude and then it just feeds itself (while refund rates would climb as more and more people realize they can just buy something and request a refund). I've had to go through a charge back before with a company and it wasn't easy or fun, so if you get rid of the refunds on digital products in your niche, charge backs really aren't that easy of an option for most scammers--IMO.
          I have a 2 strikes your out policy. If you refund from me 2x you get banned. Clearly my products are not a fit for you so I block further purchase attempts. I have had some angry emails from people trying to purchase a 3rd item. I explain that I am not in a position to meet their expectations.

          One guy wanted a product so bad he mailed me the cash with an apology for refunding. He admitted to buying almost every IM product he could find and refunding.
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          • Profile picture of the author Andy Money
            Originally Posted by Brad Gosse View Post

            I have a 2 strikes your out policy. If you refund from me 2x you get banned. Clearly my products are not a fit for you so I block further purchase attempts. I have had some angry emails from people trying to purchase a 3rd item. I explain that I am not in a position to meet their expectations.

            One guy wanted a product so bad he mailed me the cash with an apology for refunding. He admitted to buying almost every IM product he could find and refunding.
            That's a really good idea, how do you manage that though? Block their IP? Their email? Are you using some script or something? Good thinking though, lol at him sending you cash in the mail. That's great.
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        • Profile picture of the author Daniel E Taylor
          Originally Posted by Andrew Maule View Post

          Exactly. Plus, that seems to be the problem, people take that attitude and then it just feeds itself (while refund rates would climb as more and more people realize they can just buy something and request a refund). I've had to go through a charge back before with a company and it wasn't easy or fun, so if you get rid of the refunds on digital products in your niche, charge backs really aren't that easy of an option for most scammers--IMO.
          My refund rates haven't skyrocketed and we advertise a no questioned
          asked.

          Recently we just sold over 100 copies of a course we sold at
          2 pricepoints $97 and $197

          We only have 2 refund requests.

          1. Because the person said he felt he spent the money
          unwisely because he hadn't even implemented the
          stuff from the beginner courses yet.

          2. Because he didn't see the results that was promised.
          Although it was clear he didn't put anything into use
          and probably got over on us.

          Total profit over $10,000
          Total Refunds: $284

          And that's just one product. Our refund rates are REALLY low.

          Maybe that's because we focus on providing EXCEPTIONAL value
          and create a customer base of growth, honesty, and integrity.

          If you promote A bunch of get rich quick, Be lazy and get results,
          etc... who are the people you are going to attract?

          Build a solid business around providing exceptional value and
          you should be fine.

          There are alot more honest hardworking people than there are
          scammers and scumbags. At least that's my view of the world
          and my business reflects that.

          So maybe I'm biased because I don't get many refunds.

          Daniel
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  • Profile picture of the author timpears
    If the IM niche didn't make such wildly exaggerated claims, the refunds wouldn't be such a problem I would think. But the number of times that I have seen you can make, you insert the number, in just 24 hours, or some such bs is unbelievable. And people believe that crap and expect it to be delivered. No experience is needed, no work is needed, all you got to do is buy the product and put it on your hard drive and the money will come.

    You know I am being a little facetious here, but that is the mentality. But there is blame to go around on both sides.
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    • Profile picture of the author Brad Gosse
      Originally Posted by timpears View Post

      If the IM niche didn't make such wildly exaggerated claims, the refunds wouldn't be such a problem I would think. But the number of times that I have seen you can make, you insert the number, in just 24 hours, or some such bs is unbelievable. And people believe that crap and expect it to be delivered. No experience is needed, no work is needed, all you got to do is buy the product and put it on your hard drive and the money will come.

      You know I am being a little facetious here, but that is the mentality. But there is blame to go around on both sides.
      I have to agree with you. These types of offers have created a culture of increased expectations. Everyone wants to tap a few keys to get those fat google checks everyone is blogging about.
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    • Profile picture of the author Andy Money
      Originally Posted by timpears View Post

      If the IM niche didn't make such wildly exaggerated claims, the refunds wouldn't be such a problem I would think. But the number of times that I have seen you can make, you insert the number, in just 24 hours, or some such bs is unbelievable. And people believe that crap and expect it to be delivered. No experience is needed, no work is needed, all you got to do is buy the product and put it on your hard drive and the money will come.

      You know I am being a little facetious here, but that is the mentality. But there is blame to go around on both sides.
      True, plus the nature of the niche attracts certain people as well.
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    • Profile picture of the author sahi
      Originally Posted by timpears View Post

      If the IM niche didn't make such wildly exaggerated claims, the refunds wouldn't be such a problem I would think. But the number of times that I have seen you can make, you insert the number, in just 24 hours, or some such bs is unbelievable. And people believe that crap and expect it to be delivered. No experience is needed, no work is needed, all you got to do is buy the product and put it on your hard drive and the money will come.

      You know I am being a little facetious here, but that is the mentality. But there is blame to go around on both sides.

      The nature of such products have created this refund mindset and as a result if one doesn't offer a refund others will be against you for not offering refund or moneyback guarantee. But whatever the case may be, it will be a long time before marketers will stop offering refunds or moneyback guarantees with their products. Behavioral change takes a long time to take its effect in people.
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  • Profile picture of the author TheBeatles
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    Always promote stuff where there is no refund...like membership sites
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  • Profile picture of the author sbucciarel
    Banned
    I am hardly ever asked for a refund, but give them when asked. That being said, they are not allowed to use my websites and not allowed to purchase from me again if they get one. For those who have bought a website from me and then asked for a refund and used the website anyway, I issued a DMCA notice to host and the website was taken down.

    Everywhere I shop, I can return physical items I buy if they are defective or unsuitable in some other way. There are so many scams on the Net, offering refunds gives people more of a sense of security against getting scammed.
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    • Profile picture of the author Mike Anthony
      I don't think its just IM sellers fault. Theres a culture on the internet that everything ought to be free. I've seen people actually offended if they see a blogging platform that isn't free. Worse case I've seen is people complaining that a shopping cart script (designed to make money) is a "rip off" if it isn't free.


      Software is one thing information is another. Quite a few People really believe that all the information on the internet ought to be free. So they demand a refund like its a moral right after they have digested your hard work.
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  • Profile picture of the author broker12
    I think it has more to do with the value of your product and customer service than whether you offer a refund a not. If it is low value, people will feel ripped off and want their money back, whether you offer to refund it or not.
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  • Profile picture of the author christftw
    You said the conversions were better with a no-refund policy? Weird. Maybe this should be a part of my split-tests -- I considered a refund policy a constant, unlike headlines/etc. that could be changed (unless I was changing the wording/design/etc. of the money-back guarantee or whatever).

    I've never done one that I remember and I don't know all that much about them, but doesn't a charge back hurt your credit score? If so, it probably wouldn't hurt to point this out in some text after the purchase reminding them.

    Reading this topic has seriously made me re-consider always offering a refund. I don't know the legalities, but could you offer refunds 'at your sole discretion'? On the sales page, still offer a money-back guarantee if X or Y doesn't happen after they've put it to use, then after the purchase give them a link to the refund page and send it in an email. The refund link would be to an area on your site with a form they could fill out to email you, that had plenty of space for a good reason. If you (honestly) found it a good reason, give them the refund, but if not... well, don't.

    The refund page on your own site might divert their attention from being able to do it via PayPal or whatever -- where it would be forced. But instead of banning refunds totally, the good honest guys could still do it.

    Charge backers would just be banned from further purchases... and I like the x2 refund ban idea, although with someone with lots of products it might be best to just add a "Are you sure you want to make this purchase..." page in the order process, and a ban for x3 or x5'ers or so -- depending on how many products there were. Maybe I'm too soft lol. I know some prominent marketers completely ban after just 1 refund.

    Jesse
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    • Profile picture of the author Andy Money
      Originally Posted by christftw View Post

      You said the conversions were better with a no-refund policy? Weird. Maybe this should be a part of my split-tests -- I considered a refund policy a constant, unlike headlines/etc. that could be changed (unless I was changing the wording/design/etc. of the money-back guarantee or whatever).

      I've never done one that I remember and I don't know all that much about them, but doesn't a charge back hurt your credit score? If so, it probably wouldn't hurt to point this out in some text after the purchase reminding them.

      Reading this topic has seriously made me re-consider always offering a refund. I don't know the legalities, but could you offer refunds 'at your sole discretion'? On the sales page, still offer a money-back guarantee if X or Y doesn't happen after they've put it to use, then after the purchase give them a link to the refund page and send it in an email. The refund link would be to an area on your site with a form they could fill out to email you, that had plenty of space for a good reason. If you (honestly) found it a good reason, give them the refund, but if not... well, don't.

      The refund page on your own site might divert their attention from being able to do it via PayPal or whatever -- where it would be forced. But instead of banning refunds totally, the good honest guys could still do it.

      Charge backers would just be banned from further purchases... and I like the x2 refund ban idea, although with someone with lots of products it might be best to just add a "Are you sure you want to make this purchase..." page in the order process, and a ban for x3 or x5'ers or so -- depending on how many products there were. Maybe I'm too soft lol. I know some prominent marketers completely ban after just 1 refund.

      Jesse
      I think you can offer them at your discretion, that's what most people do, they just don't call it that on the sales page

      But just to clarify, yes, my conversions were much better when I offered no refund and I also got virtually no requests for refunds. This was on one of my more popular WSOs, where people were buying it and sharing it on piracy forums, so I said I wouldn't give any refunds. Another warrior told me I should take that notice down since I might drive away potential sales, etc. so I did--that's when the sales dropped and all the sales I got were people asking to have a refund (then I saw them with the SAME username as they had on WF posting it on other forums).

      I put the notice back up and sure enough, sales went back up and refunds dropped to the floor (almost).
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  • Profile picture of the author TelegramSam
    A lot of the comments on this thread are speculation, one way or the other.

    There is only one way to find out: TEST IT

    Sam
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  • Profile picture of the author Rohit Shah
    Great read, nice conversation going on here.
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    • Profile picture of the author Kay King
      Andrew -

      Most of the sales pages (especially in IM) online make a big deal about their refund offer - they do that to get the sales.

      I seldom run WSO's but when I do it's "no refunds". I'm perfectly clear about what is being offered - you know whether you need it or not.

      I've never had anyone complain about it.

      If I offer a product and clearly state "no refund" if someone wants to do a chargeback they'll just have to go to that trouble. Those aren't as easy to do as many assume.

      Marketers fear chargebacks perhaps because they may have paypal consequences if they have too many of them. But it also reflects badly on the account of a person who initiates multiple chargebacks both with the payment processor and their credit lender.

      That said - if I offer refund on a sales page, I honor it immediately on request and then just move on. I think most refund requests come from people who aren't trying to take advantage. In my view, someone buying things he can't afford or doesn't intend to pay for won't use the products anyway. He's just playing money games with himself to feel important.

      kay
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      • Profile picture of the author Andy Money
        Originally Posted by Kay King View Post

        Andrew -

        Most of the sales pages (especially in IM) online make a big deal about their refund offer - they do that to get the sales.

        I seldom run WSO's but when I do it's "no refunds". I'm perfectly clear about what is being offered - you know whether you need it or not.

        I've never had anyone complain about it.

        If I offer a product and clearly state "no refund" if someone wants to do a chargeback they'll just have to go to that trouble. Those aren't as easy to do as many assume.

        Marketers fear chargebacks perhaps because they may have paypal consequences if they have too many of them. But it also reflects badly on the account of a person who initiates multiple chargebacks both with the payment processor and their credit lender.

        That said - if I offer refund on a sales page, I honor it immediately on request and then just move on. I think most refund requests come from people who aren't trying to take advantage. In my view, someone buying things he can't afford or doesn't intend to pay for won't use the products anyway. He's just playing money games with himself to feel important.

        kay
        Kay

        You just covered a lot of really valuable/important points... that's for that post.

        Andrew
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