Refund Policy for Digital downloads

by alanaj
14 replies
  • CRO
  • |
Quick question for everyone. Do sales pages with refund policies convert better than sales pages without refund policies?

Which is better 60 day refund or 90 refund?
#digital #downloads #policy #refund
  • Profile picture of the author chewie49
    They say so...in my experience: Yes, I make more sales and also I get a lot more refunds.

    So...I don't offer a refund guarantee for digital downloads.
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    • Profile picture of the author dburk
      Hi alanaj,

      Why guess when you could know?

      I see a lot of people asking questions here in a fashion that seems to be an attempt to bypass the conversion optimization process, which involves testing. This is something that varies a bit from one website offer to another. Someone else's experience, or opinion isn't always helpful as so many of these situations are specific to the particular use case.

      The best thing to do is test. I suggest you setup an A/B split test and measure the results. And do not simply compare the conversion rate, but the retained earnings after the refund period has expired. Using real data is always better than guessing, or asking opinions.
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      • Profile picture of the author Raydal
        Originally Posted by dburk View Post

        I see a lot of people asking questions here in a fashion that seems to be an attempt to bypass the conversion optimization process, which involves testing. This is something that varies a bit from one website offer to another. Someone else's experience, or opinion isn't always helpful as so many of these situations are specific to the particular use case.
        Well, maybe because other people have tested the very question they
        are asking and they want to know the results of others. Not a bad idea.

        Otherwise than this the whole optimization forum could be just about
        how to test rather than discussing test results.

        So when I set up a page I want to go with best known practices and
        then test other changes than what has been proven in the past. Not
        to say that every market and every marketer would get the same
        results but we need a BENCHMARK from which to start.

        So a refund policy and long guarantees have been shown over
        and over again to boost conversion, so the answer to his question
        is yes.

        -Ray Edwards
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        The most powerful and concentrated copywriting training online today bar none! Autoresponder Writing Email SECRETS
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        • Profile picture of the author alanaj
          Originally Posted by Raydal View Post

          Well, maybe because other people have tested the very question they
          are asking and they want to know the results of others. Not a bad idea.

          Otherwise than this the whole optimization forum could be just about
          how to test rather than discussing test results.

          So when I set up a page I want to go with best known practices and
          then test other changes than what has been proven in the past. Not
          to say that every market and every marketer would get the same
          results but we need a BENCHMARK from which to start.

          So a refund policy and long guarantees have been shown over
          and over again to boost conversion, so the answer to his question
          is yes.

          -Ray Edwards
          Thanks for you feedback Ray. This is exactly why I posted the question. I certainly wasn't trying to cut corners but to get a better idea of others have done and what their results have been.
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        • Profile picture of the author dburk
          Originally Posted by Raydal View Post

          Well, maybe because other people have tested the very question they
          are asking and they want to know the results of others. Not a bad idea.

          Otherwise than this the whole optimization forum could be just about
          how to test rather than discussing test results.

          So when I set up a page I want to go with best known practices and
          then test other changes than what has been proven in the past. Not
          to say that every market and every marketer would get the same
          results but we need a BENCHMARK from which to start.

          So a refund policy and long guarantees have been shown over
          and over again to boost conversion, so the answer to his question
          is yes.

          -Ray Edwards
          Hi Ray,

          I do not disagree with you at all. Sales pages with Refund policies frequently improve conversions, however they can sometimes reduce the overall profitability of an offer, and in some cases even reduce conversion rates.

          My point, which I clumsily tried to make, is that what works for one site usually doesn't work the same on another. I just wanted to encourage the OP to setup his own tests and establish his own benchmark, as that will be far more useful than applying data from a completely unrelated website.

          One of the things I have learned from years of conducting marketing experiments is that simple changes, that seem very small, can often make a huge difference in conversions. And while it works well on one site, it might not work at all on another website, even if it is in the same niche. There are a lot of variables in every situation and trying to use benchmarks from other people's websites will frequently lead to poor decisions.

          And since this forum topic is about CRO, it seems appropriate to encourage the CRO process rather than the shoot from the hip approach based on anecdotal evidence. I would like to see, not only discussions on test results, but also how to setup and conduct valid tests, how to analyze the results to gain insights based on valid conclusions, and how to apply those insights to improve results within a continuous cycle of improvements.

          I believe that decisions that are based on a consensus (or preponderance) of opinions is often flawed and not truly within the spirit of scientific method which CRO is all about. I would like to see the members of this forum encourage testing based on a valid scientific process, and decisions based on empirical data. They can get the opinion based consensus from just about anywhere else on this forum, it would be nice if we could make this into a high value forum full of useful information about CRO, with testing as it's core. CRO is about collecting data on the website in question and acting on it.

          There is nothing wrong with looking at data from other tests to get ideas about what to test on your own website. However, using data from a different website is not valid CRO in my opinion, and I simply want to discourage that approach in favor of science based CRO methods.

          We have an opportunity to make this forum into something magnificent and I am deliberately pushing towards that goal. Please understand I don't mean to offend anyone, but I do intend to challenge the quality and direction of discussions for the sake of making a better forum.
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  • Profile picture of the author alanaj
    Thank you both for your feedback.
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  • Profile picture of the author BoostSales
    You will always get refund requests from those freebie seekers.

    It's inevitable
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  • Profile picture of the author Vixoma
    Lot's of people just prefer to buy and get refunds when they have the product, that really suck for vendors and affiliates.

    But in my opinion having the 60 Day refund badge converts well, people like to know they can get their money back if the product is not what they expected.
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  • Profile picture of the author Adam Roy
    I personally don't offer a refund policy or money back guarantee.

    Instead, I offer a "hold your hand" guarantee.... Basically, if you can't make it work, I'll hold your hand and FORCE you to make it work.

    Here's the problem with refunds on digital products (particularly with reference to ebooks or training material, not software or memberships, etc):

    Too many up and comers these days see a money-back guarantee as a "free product". It's sad but it's true. I can almost guarantee that a percentage of your refund rates will always be from buyers who knew they were going to get a refund before they even purchased the product, purely because you offer a "no questions asked 100% money back guarantee", regardless of the time frame provided.

    At the end of the day, you want to show your affiliates a low refund rate, and ALSO, you want to show Paypal a low refund rate (or whatever processor you use).

    Refunds are almost always a negative indicator one way or another. So the more you can do to avoid them, without sacrificing customer confidence or profitability, the better. In my opinion.

    I used to offer money back guarantees on my training, and being a person who believes in providing thorough, quality content in my products, any refund request is very frustrating. ESPECIALLY when the refund request is made within an hour or even a couple days of the purchase, so you know damn well the buyer didn't even try to take action on or put effort towards whatever it is that the training covers.

    All in all I totally believe in providing a guarantee of some sort, to instill confidence in your prospects and to provide post purchase support/guidance, but sometimes, especially with digital training products, a money-back guarantee may not always be the best or most profitable offer to make in your sales message.
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  • Profile picture of the author grafx77
    There will always be freebie seekers, no matter if you have the money back guarantee or not. This is just apart of the game, so you might as well utilize the extra conversions and appeal that the money back guarantee offers that not at all.

    Plus, you can always blacklist the email and IP address of the "freebie seekers" for future products if your apart of an affiliate network. For instance, CB will only allow a certain amount of refunds from a buyer before they actually suspend the account. The same may be true for WarriorPlus, JVZoo, and others.
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  • Profile picture of the author serpyre
    Look at what Amazon, iTunes, etc. all do - it's a global marketplace so you need to compete with everyone. From there you can adjust downwards to your strategy. You can also do the other suggestions and go from the bottom up - but we always like to point people to the 'birds management' image!
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  • Profile picture of the author Jarvis Edwards
    YES! Refund policies increase conversions because it helps reduce the perceived risk associated with buying "non-tangible" products.

    I've found that you can reduce the refund requests by:

    #1. Having an excellent product that fulfills claims made by the sales copy

    #2. Make it more difficult to get a refund by having a physical product (i.e. send a DVD to their address upon purchase which requires sending it back to get refund credit)

    #3. Provide full support with your digital product, and require they first exhaust efforts for your support to help their problem, before you grant a refund.

    #4. Avoid Clickbank if refunds truly matter (lol) because 1-3 are now null and void.
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  • Profile picture of the author davemiz
    @adam - interesting twist the holding your hand thing. working out better?

    very true.. clickbank makes it too easy to refund for customers… refunds for me are like 2-3x what they were selling just physical... and sending the physical version with digital should reduce refunds a lot.
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    “Judge your success by what you had to give up in order to get it.”
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