Abusive Behavior by Customers: The Downside of a Liberal Return Policy

We know that shoppers have high expectations with regard to company return policies. They want the returns to be easy and convenient, the terms of the returns to be liberal, and refunds/exchanges to be quick. Return policies often come up high in customer complaint surveys.
What do YOU think a truly customer-oriented firm to do if customer complaints are excessive?
Consider this scenario, as described by Michael Hess, writing for CBS MoneyWatch:
“For decades, outdoor retailer REI has taken back any product, no matter how old, no matter the reason, absolutely no questions asked. But, over time, the policy became badly abused: Customers were returning 30 year-old, hard-worn clothing just to get more current styles, and some were even boasting online about gaming REI’s system. So what’s a customer-loving company to do?”
“This summer, the company did exactly what it had to do when put in such an untenable position: It reined in its guarantee, accepting no-questions-asked returns for a year, and quality-related returns for life. Still extremely customer-friendly and generous, but more controllable. Yet even with a great policy still in place, some people complained, as if the company had lost its service ethic, when in fact it was a case of customers taking (at times outrageously) unfair advantage of that ethic and forcing REI’s hand.”
Click the image to read a lot more.

 

This entry was posted in Part 2: Ownership, Strategy Mix, Online, Nontraditional, Part 3: Targeting Customers and Gathering Information, Part 5: Managing a Retail Business, Part 6: Merchandise Management and Pricing, Part 7: Communicating with the Customer and tagged , , , , , , , , , , , . Bookmark the permalink.

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