To Refund or Not To Refund

Discussion in 'General Business' started by dragons5, Jun 4, 2008.

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Should there be refunds/returns on digital goods?

Poll closed Jul 4, 2008.
  1. Yes - on all digital items.

    2 vote(s)
    13.3%
  2. Yes - only on license controled, encoded items.

    4 vote(s)
    26.7%
  3. Yes - at the sellers disgression.

    2 vote(s)
    13.3%
  4. No - too many people will rip you off.

    7 vote(s)
    46.7%
  1. #1
    Recently I sold a one of a kind script from my webstore. Almost immediately after the transaction I received an email from the buyer requesting a refund due to some bugs in the script.

    I believe in most of my products and have used the script myself a handful of times and never noticed a bug so this particular situation concerned me.

    I replied to the buyer seeking information on the bugs and informed that in lieu of a refund I would gladly fix all bugs immediately and send the corrected copy over.

    At this point I began to reflect on my prior experiences as a buyer looking for a refund. Some sellers were eager to appease me and some were reluctant and others outright refused. In recent memory one seller who had sough to retain me as a customer and ultimately gave the refund I requested even told me he did so because his script was encoded with ioncubes and used a license system. My script uses neither.

    The seller replied with four 'bugs' all of which were features of the script she simply did not like. All of which are visible and available on the scripts full working demo site.

    Then the email took a turn to the suspicious. The buyer, who by the way had been signed up for the store for months now, claimed that she had found a similar script that was free but with far more features and just couldn't see using this script because she didnt like it.

    She then threatened a paypal dispute

    I replied with my concerns that she was mistaking bugs for features and that there was a full demo to use that revealed all of these. I also then explained my stores 'no refund' policy which is in place because this script is open source and digital. There is nothing stopping buyers from buying, copying and getting a refund.

    I awaited a reply and agonized over my response for hours. I hated not being able to give a refund, had this been a car or a table or something real and tangible I would have quickly taken it back and given her the cash - but not encoded and digital made it a tough choice.

    Finally the response came simply with one sentance stating "i did use the demo." That's it. This buyer had been using a signature and lots of language but now just one sentence... I felt her despair and began watching my paypal account waiting on the dispute to be filed [just checked again].

    Days went by and I just kept mulling it over in my head... did I do the right thing? perhaps i should just trust all my customers without question? Finally I had to do something - I sat down and replied to the customers last email with an offer. 50% store credit from her purchase. So basically half the refund but for store credit only.

    Two days passed with no word, then.... I get a 'returned email' from gawab.com - the email provider. It stated that there was a permanent error - that the account no longer existed.

    A rush of relief swept over my mind. I had just avoided a scammer, a very careful, methodical scammer. Someone had tried to steal my script (most likely for resale) and my money and my dignity along with it. And I fought back and won.

    Did I do the right thing? What do you think? What is your refund/return policy?
     
    dragons5, Jun 4, 2008 IP
  2. Clive

    Clive Web Developer

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    #2
    Looks like you've avoided a scammer. Nothing too complicated to understand and explain to yourself. This happens all the time, it's only a matter of who get targeted and when. If you develop and sell scripts in unencrypted form, then you should clearly state your refund policy, a demonstration website is absolutely necessary so that potential customers know what they are buying.

    Sooner or later, your script will be shared on torrent websites and warez forums, that's unfortunate but a fact. If you learn to ignore that and accept the loss, then you have the other part of the business that consists of loyal customers who you need to support continuously to get the credits.

    There should be no sympathy towards scammers. They disrespect your work, why would you in turn pity them? It is a thousand times more pleasant to receive a positive feedback from a happy customer, and that's where you should concentrate your efforts. Making others happy with your products and services. Ignore scammers.
     
    Clive, Jun 4, 2008 IP
  3. PostPerfection

    PostPerfection Guest

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    #3
    You can really only offer a refund on products that don't allow the user to continue to use them after the refund. It's not fair to the seller to have to give away free copies. Also buyers beware is something ever buyer needs to understand.
     
    PostPerfection, Jun 4, 2008 IP
  4. DGentertainment

    DGentertainment Peon

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    #4
    A buyer cannot be awarded a refund via a paypal dispute dont know why but paypal do not offer cover for that,
    So if you belive the person a scammer never refund tell them you will fix any problems and ask them for screenshots. then fix the problem and its sorted.
     
    DGentertainment, Jun 4, 2008 IP
  5. TTS

    TTS Peon

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    #5
    Sounds like someone just wanted a free script
     
    TTS, Jun 4, 2008 IP
  6. Clive

    Clive Web Developer

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    #6
    ...and it's more human if you simply download it from a torrent site rather than rip the script author...
     
    Clive, Jun 4, 2008 IP
  7. Lord Hades

    Lord Hades Peon

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    #7
    Good to see someone with a conscience. You were right in not issuing the refund. If the bugs were actually there, then there is no justification NOT to issue a refund but if they were simply features, then it's the buyer's fault.
     
    Lord Hades, Jun 4, 2008 IP
  8. scozzie

    scozzie Active Member

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    #8
    @ the OP...the link in your sig "buy cheap templates" isn't working...thought I should mention it.
     
    scozzie, Jun 5, 2008 IP
  9. Clive

    Clive Web Developer

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    #9
    Bugs aren't necessarily a reason to claim a refund before you've given the author reasonable time to investigate and provide fixes. Bugs are what a community is there for to discover and report.
     
    Clive, Jun 5, 2008 IP
  10. mentos

    mentos Prominent Member

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    #10
    I don't think paypal will refund $$ to the buyer..
    AFAIK,PP will not refund $$ for non physical item such as hosting
    Read this email i got from paypal
     
    mentos, Jun 5, 2008 IP
  11. ChPeter

    ChPeter Peon

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    #11
    the same goes for our website templates business...
    customer purchases the template, orders template customization, we do all the work, send him/her the files .... and then goes a sudden refund stating that he has changed up his mind and does not want to use it any more :eek:
    but hey, we were working, we did everything that was ordered and then we receive nothing :mad:
    another popular issue is to pay for the template, receive the source files, drive the support staff up the wall and then request the refund with no explanation :mad:
    however, the positive feedback and our work appreciation do take place and this is always pleasant :p
     
    ChPeter, Jun 6, 2008 IP
  12. dragons5

    dragons5 Well-Known Member

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    #12
    Thanks. Link Fixed :D


    I've decided to make my store a complete 'no-refund' store and cite the above example as the reason. There is just too much risk of getting ripped off these days.
     
    dragons5, Jun 6, 2008 IP
  13. Groundup

    Groundup Peon

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    #13
    Thats a good decision, back when I did ebay to many people were doing that, trying to get something for nothing, it got quite tiresome.
     
    Groundup, Jun 6, 2008 IP
  14. canuckbob

    canuckbob Peon

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    #14
    I think there are too many people out there taking advantage of people selling digital products. I think any product that's downloaded and used by the customer should be non refundable. If a person has buyer's remorse and hasn't downloaded or used anything then I think they should receive a refund.
     
    canuckbob, Jun 6, 2008 IP
  15. sharpshooter

    sharpshooter Well-Known Member

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    #15
    Thats true - I raised a dispute and they went through the whole routine of sending in details. The seller finally sent me the script and then paypal emailed to say

    "oh we don't provide support on virtual goods"
     
    sharpshooter, Jun 6, 2008 IP
  16. YMC

    YMC Well-Known Member

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    #16
    That was my only question in your story - was there a terms of service and refund policy listed on your site? Seems like you gave the buyer everything she needed to make her decision - assuming your demo is not crippled in some way.

    Gut feelings are harder to glean on the net but when they are negative we should probably listen just like we do in person. Congratulations on smelling this rat.
     
    YMC, Jun 6, 2008 IP
  17. jobic

    jobic Peon

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    #17
    I try to give refunds on everything I sell. On services it usually get's harder to give a refund because you can't get the hours invested back. Still if I didn't waste to many hours I'll give a refund.

    Scammers are everywhere and refunds on stuff like ebooks are usually only given when the buyer has used the methods for at least a month (or however long the method takes before it shows any results) and if he show he tried the methods to the t and can't make it work for him then I'll gladly give a refund.

    Buying something and then immediatly asking a refund is something that should be penalized. I once noticed a guy who bought an Ebook that I was selling at the time and in the same minute (I checked and double checked this to be sure) he asked for a refund. He stated he read the Ebook and that he had learned nothing new from the ebook and he made a mistake to buy it. (by the way the Ebook was just over a 100 pages)

    So I replied that either he was the world champion in terms of reading speed (100 pages a minute, wish I could do that) or he was trying to get the product for free and that he was trying to rip me off.

    Never heard from him since. I sold a cd-rom drive I had lying around as a spare, hooked it up to my pc to check if it worked and it did, played a few music cds as a test. And I placed it on Ebay for next to nothing. Couple dollars I think, I just wanted to get rid of it.

    When the auction was over I sent the buyer (or winner) the payment details, he paid and I sent the cd-rom with loads of bubble wrap and pieces of newspaper as cushioning in a box to him.

    Few days later he responds that he received the cd-rom and it wasn't working and he was treathening with a negative feedback, I replied that I had hooked it up and tested it and it worked fine so it wasn't my fault.

    He didn't respond, didn't leave feedback and I never heard from him again.

    I try to ask as few refunds as possible, especially with Ebooks. Because you buy it, ask for a refund but you still have the Ebook, so it's not a really fair thing to do.

    greetz,
    jobic
     
    jobic, Jun 6, 2008 IP
  18. dragons5

    dragons5 Well-Known Member

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    #18
    UPDATE: The buyer in my story has opened a paypal complaint claiming 'non-reciept' even though clearly they did receive the product.

    I dont know how I missed it, seems the claim was a few days ago...
     
    dragons5, Jun 6, 2008 IP
  19. jscowen

    jscowen Peon

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    #19
    You did the right thing. These purchases can't be returned, so you have to have a no refund policy.

    Don't think anything will happen with the complaint, as you said they got the script, and have always said in emails that they received it.
     
    jscowen, Jun 6, 2008 IP