17

I have come across this several times when selling a prepackaged solution.

Customer buys the package, which clearly sets out that it can do XYZ, but the customer wanted it to do ABC.

The customer then emails for support. I inform the customer that the product was never designed for the purpose they had in mind (integrating it with another product).

The customer asks for a refund as they cannot use the product.

This is where I'm in two minds. First, the product is fully functioning and they have now obtained the source code (PHP script). How am I to know they aren't going to use it anyway and still want a refund?

Second, I do feel bad for the customer. If they're being honest, and most are, then they cannot use the product and therefore "wasted" the money in their eyes. But, that wasn't my fault.

Up until now I've refunded the money if requested, but now I'm comparing what I do with how bigger companies deal with this kind of situation. What would they do? Maybe because they're bigger, they don't care about a few refunds every now and then, but to a one man band like me, every sale is needed!

What is the best way to deal with this kind of situation?

psx
  • 462

8 Answers8

33

Refund him without asking questions.

You don't want his money if he is not completely satisfied.

Those cases in Software will be very limited according to literally dozens of stats reported by software vendors in this forum. My own numbers were under 0,3% over the past ten years, and dropped it to 0% over the past 2 years.

A very good example of guarantee can be found here. Almost all successful software vendors are proposing the same guarantee.

If your refund rate is more than 1%, change how you communicate on your website and/or improve your product.

16

If 'several people' are doing this, then:

  1. The branding isn't as clear as you think it is. Make it clearer. Hire someone who does this for a living.

  2. If you're worried about people taking your source code and using it anyway, then maybe you shouldn't be writing it in PHP, or have some sort of authentication?

Overall, if you can you want to maintain a good rapport with customers (present and past), so unless there's a compelling reason not to, giving refunds (no questions asked) is usually a good thing.

After looking at your website (by searching for your user name and seeing it on twitter), I noticed the following:

You say that it can be integrated with two products, and that more will be coming in the future. That's important because it leaves open to the customer that you should (at some point) be able to integrate it with vBulletin or another product.

George Stocker
  • 6,418
5

While I agree in a service industry reputation is a key issue, one of the things that nullifies that is the unlikelihood of "word of mouth" sales, repeat customers, or any of the other hallmarks of a good reputation. If you're a one man software seller, then it's unlikely you're offering a ton of products, particularly if they're as complicated as this one likely is given some of the hints in your comments.

While I agree with @George Stocker that the number of these requests points to a potential problem in the "clearness" of your product's capabilities, I also agree (though less aggressively towards customers) with his commenter @SLC that customers may tend to be lazy with respect to ascertaining product features.

My opinion (and personal practice for my own side projects) is this:

  1. With a clearly visible source code there should be a key activation mechanism within the software that allows operation of the software for 30/60/90/whatever days. It doesn't have to be enterprise level suitable for Microsoft or anything, but something that makes it very unattractive to try to "get around". During the period, if the product is undesired, their money is refunded and the key no longer works at the end of it. If a refund is not requested, a new key is delivered and no refund is given from then on.
  2. If someone is not smart enough to try before they buy or throws money down on a product without verifying first that it will do what they need, then they deserve to be separated from their money. Make it clear on your website that services and products are offered without refund at all or after a certain amount of time, etc. If you use the method I mention in #1 mention that.
  3. Research the return policies for software at major companies (software in the box). See if any of them might be compatible with your capabilities. Most won't accept refunds on opened software or will refund a certain amount minus a restocking fee. When you ship the code, it is considered immediately opened software, and these policies may be helpful to you.

In all aspects of purchasing/selling I involve myself in, I operate under the phrase "Caveat emptor". It's the responsibility of the purchaser to make sure they know what they're buying. You're not out there smooth talking these people into buying your software, it's being purchased through your website. They're not being taken for a ride, they're being frivolous with their money, and their carelessness will only end up costing you money in sales and time spent dealing with it.

On the other hand, if you are out there smooth talking them out of their wallets, give their money back, ya crook.

Joel Etherton
  • 11,684
  • 7
  • 47
  • 55
1

For me this is all about reputation, especially important for a one man band. Showing the customer you care about their needs by issuing a refund when the product does not meet their perceptions will almost certainly create good feeling and make them more likely to come back to you in the future.

If this is happening frequently you could look at how you interact with your customers pre-purchase. Are they able to try the product? Can they talk to you for advice and and really find out what you can do for them?

Chris Meek
  • 111
1

It seems like you should give out trial versions. Give a trial version that only works for 30 days. This gives them time to try it out and see if it fits their needs.

Of course, you should only give out the actual code after they bought it or they could just remove your checks.

Carra
  • 4,281
0

Why are you seller with source code to users that have even tried the product? - Why not offer a time limited trial first, then sell, or sell for even more if covers code.

Also, invest more in a site explaining what your product does, how it works with examples and videos. Perhaps offer discounts to customers that write good recommendations that you can publish in your site.

Danny Varod
  • 1,158
0

While I (sort of) agree with all the answers above, I'd like to play devil's advocate here. I mean, if you actually put out the statement "No Refunds" on your site clearly, in addition to pointing out that you recommend the demo be tried out first before purchasing the product, you should probably be able to resolve your issue.

Maintaining a reputation is one thing,but doing so while running the risk of suffering a loss (albeit gradually) is unacceptable,I'd assume.

lightsong
  • 571
0

You should give unsatisfied customers their money back, but also secure you source code, perhaps use some licensing mechanism.

Gipsy King
  • 139