Info-Profits Talk - Okay, how are you handling refunds?

Yoon Ho Um

Hi IPT Family,

Yup, talking about refund requests here... fun, fun!

When you receive one of those "dreaded" refund
requests do you instantly refund the money or...?

-Send them a "Read our refund policy here" email.
-Tell them to go where the sun don't shine (there
seems to be a trend where "gurus" are starting to
browbeat their potential refunders into "I don't
want my money back" submission)
-Our refunds are conditional, not the unconditional
90 day moneyback guarantee like you expected,
did I fail to mention this on my salespage...?
Oops!

Hmmm, maybe you do just give them the refund...?

Instant refund=less stress, less hassle, more free
time,etc. Oh yeah ==> less headaches!

Are there any reasons why you wouldn't refund
the money?

Is there any legally required Refund Policy text?

Do you have a system to reduce refund requests?
Eg. Extensive FAQ, step by step video training
(like our resident expert Louis), follow up tips 'n
tricks(autoresponder), etc.

And when you do offer the refund do you ask
them what it was about your product or service
that caused them to request their money back?
How about "How to improve our product/service"?

allan

Thankfully I don't get too many but it doesn't matter who you are
or how good your product is it's going to happen.

I personally give the refund immediately and then get on with life.

There are all sorts of reasons for refunds and here are some...

1) The rip off crowd... These are the people who consistently
refund almost every digital download they buy and never had any
intention of paying using the refund loophole to grab as many
products as they can.

2) Those who mis-understood the salesletter and really didn't
want the particular product they purchased

3) Those who find the product too complicated to use or learn

4) Buyers remorse - they purchased on the spur of the moment
after reading your great sales letter and then cool off and
realise they really didn't need that product after all.

5) Fall on hard times... a bit like buyers remorse where they
didn't budget to pay the bills and spent their money on your
product instead and plead for a refund.

6) A lousy product -

I don't know the law but I believe you have to offer 30
days refund time and if not all your customers have to do
is go to the payment processor and ask for a refund anyway.

The professional rip off artists know this and sometimes just
go direct to clickbank or others and get a refund without you
even given a chance.

Ways to avoid?

As you mentioned a good faq section

A good follow up system offering more answers, successful
examples, extra bonuses and so on

Excellent customer support

All in all you just need to factor in refund requests as just a part
of business I'm afraid.

Thanks
Allan
Start your own membership site
http://www.instantmembershipsite.com

Louis

Hi Yoon

I think Allan pretty much hit all the nail's on the head.

It's going to happen. And if you don't get refunds, chances are you'll get chargebacks (which are usually more expensive since often there's a fee).

It does frustrate me when people chargeback before even asking for a refund. But anyway...

I make sure I have a clear refund policy in my sales letter. And I very rarely change this.

Hopefully, when signing up they've read this so they know what to expect.

The problem with membership sites - sometimes people ask for multiple months back.

Since I pay affiliate commissions on a monthly basis, I really can't do this and try to make this clear in my sales letter.

I get hardly any multiple month requests these days. Most people keep to the guarantee and simply ask for the first month back. And even then it's a tiny minority.

Sometimes the reasons given for a refund request are a bit of a stretch, but I find it's not worth getting into discussions regarding why and I simply action a refund as according to my guarantee/refund policy.

I did find that when I had the $1 for first 10 days as a trial - refunds were a lot more.

It did surprise me that people didn't realize that they would automatically be upgraded after 10 days (I can't run a business selling everything for $1!) so that resulted in refund requests and some chargebacks.

Putting the price up greatly reduced those. Signups slowed of course, but taking all the figures into consideration (trial to full member conversion, refund requests...etc) the overall numbers are pretty much the same.

One reason I've pushed back paying affiliate commissions from around the 5th of the month to around the 20th is simply for this reason - so that if/when a refund request comes in I generally don't need to log it and carry it into next month's commissions, since this is confusing to both myself and affiliates.

There's also different ways to handle refunds as regards your affiliates. Only one affiliate program I'm involved with does it this way, and it's probably the best way so I should consider implementing this:

When a refund is given, a personalized email is actually sent to the affiliate saying that $10 (or whatever) has been taken off their commission due to a refund request.

However, that company does something unusual in that they pay commissions over a month after the commission was logged.

So April commissions are paid at the start of June.

I assume this is for their cashflow and also to allow for any refunds and avoid the whole "carry it over" thing. I've never received a chargeback through them though so I don't know how they handle those in regards to affiliates.

Anyway - I hope this helps?

Sincerely,
Louis

Yoon Ho Um

Hi Allan & Louis,

One can always just ignore the request... :rolleyes:

Any tips on having PayPal help in having money
refunded?

And if money was drawn out of a credit card to
pay someone through PayPal can you do a charge
back(this is after giving PayPal and the vendor
adequate time to return the funds)?

Do you think PayPal would just cancel your account
or freeze it if you went this route?

allan

You are playing with fire if you ignore refund requests.

You will end up with chargebacks and yes this can be
done through Paypal if they used a credit card and yes
paypal will cancell your account if they receive complaints
of poor customer care and not giving a refund is poor
customer care.

Also how would you handle your name plastered all over the
internet as one who does not honour refunds or having a
poor product?

Not issuing a refund and upsetting a customer
could see your name spread on message boards in a
poor fashion and lose you even more business.

I've seen it happen to others.

At the end of the day you should ALWAYS issue a refund
if it is requested and move on.

Thanks
Allan

jcolanzi

Allan and Louis are right. You just have to expect that a certain percentage of people go around grabbing up products and then getting a refund.

For some reason it seems to happen more with Clickbank than Paypal, but fingers crossed it hasn't happened in some time.

I think of it like a scene I saw in a show. Two guys are talking and a third guy sees them and diucks around the corner.

The one guy gets mad and says that the guy owes him money always avoids him. The other tells him he's lucky to get rid of the guy so cheap.

Bottom line, get rid of them and move on to more pleasant things and people you do want to do business with.

John

Yoon Ho Um

Hey guys,

I recently asked for a refund from someone who then
sent me a "read our policy here" email. It mentions
how your money "goes to your sponsor, not me, I
don't know where it ends up"(paraphrased).

I emailed him back stating that he is the admin, sponsor
and sponsor's sponsor, he received all the funds, I was
never able to access my membership even after multiple
attempts and politely asking for a refund again.

He has conveniently ignored my 2nd request...

To clarify... when I mentioned

"Do you think PayPal would just cancel your account or
freeze it if you went this route?"

I was talking about PayPal freezing my account for issuing
a charge back. I did not have sufficient funds in my PayPal
account so they took the funds from a credit card.

If I did a charge back wouldn't PayPal be dinged with
additional fees and thereby possibly want to freeze or
cancel my account?

I am only considering this if they guy continues to ignore
my request and PayPal doesn't do anything to help.

jcolanzi

Yoon,

I don't know the number, but if you check their site, Paypal has a toll free support number. I've contacted them a couple of times about offline charges to my Paypal card and they've always acted promptly.

John

Louis

Hi Yoon

What was their refund policy?

It sounds like an MLM kind of set up - is that right or have I misunderstood?

I don't endorse chargebacks because from a merchant's point of view they're annoying and often unnecessary.

However, that is the way of last resort.

From what I've read it's very easy to chargeback in the US. I don't know what it's like in Canada.

In the UK, it's a right pain and you have to offer quite a lot of supporting paperwork if you want to charge something back. Which I feel is right.

In my entire life I've only ever charged one item back. It was a physical information product I ordered online for around $100, and it never turned up even after chasing the merchant and getting reassuring replies for two months regarding the product being sent, and then also about actually giving me a refund.

At that point I gave up and started the chargeback process.

On the downside these days, I only ever use Debit (as opposed to Credit) cards where the money is taken straight out of your account.

These offer less payment protection than credit cards so if I do ever enter my details at a dodgy site (I'm VERY careful) I have less protection.

So if you accept credit cards with their danger of interest accruing, they do seem to protect the consumer pretty well.

And personally speaking, when I order online these days I usually feel a lot more secure doing so through a third party processor like ClickBank, WorldPay, PayPal, PaySystems...etc.

Because I find that often with those services, especially with subscriptions, the customer has a lot more control than when the merchant processes payments through a merchant account with no interface giving the customer control.

Plus of course ClickBank have their no questions asked 90 day policy which I find reassuring (even if slightly embarrassing to make use of), and hopefully it makes customers feel more reassured too and therefore more likely to buy.

Sincerely,
Louis