> Bad ones (pathological ones) - we just try to get rid of them ASAP and no refunds.

A customer "not buying much" is not "bad". If you accept his money for cheap stuff, he is your customer. There's a difference between an honest customer who usually doesn't buy much and then buys something expensive and is getting sadly scammed and a customer trying to rob you.

If you accept the customer for cheap stuff but refuse to help him when he gets scammed on an expensive item, you are the bad, pathological, person/business.

> If you accept the customer for cheap stuff but refuse to help him when he gets scammed on an expensive item, you are the bad, pathological, person/business.

For every refund system you will unfortunately get people who attempt to game that system. They'll buy many negligible cost items without issue, then a single high cost item that they'll claim never arrived hoping they've outsmarted the store or algorithm. These bad actors are why honest consumers have a hard time. I don't know what a business can do to actually differentiate the two.

There’s probably a lot of money for the first person who figures out how to solve this problem instead of complaining about evil uncaring business owners.

Costco kinda figured it out, by charging a membership fee they got rid of most low LTV customers from the get-go. Unfortunately, their generous refund policy still got hacked by bad actors which is why they have a lot of restrictions around returning electronics. (People were returning laptops after a year of use just to upgrade). This is why we can’t have nice things.

source: I worked at Costco before they had restrictions on their electronics return policy, when they bragged about accepting returns on anything for any reason… before the cost of doing so became prohibitively high.

LTV refunding like Amazon is doing is a huge leap forward that lets every business kind of act like Costco.

If their refund policy was literally "accepting returns on anything for any reason" how is it "hacking" to return a laptop after a year?

That policy assumed good faith on the part of the consumer. The original thinking was likely 'OK, if they return it after <timeframe> it's because it was a lemon/never worked right/etc' rather than for abusive reasons like 'TV returned right after Superbowl Sunday' (because they had their party and no longer need it) or 'returned laptop after 6 months' (because the school/work project ended and they no longer need it) So the assumption baked into the policy was that buyers wanted to legitimately own the thing they purchased rather than using the refund policy as a way to get a free short/intermediate term lease.

You seem to be saying 'well they did say any reason' and that good faith on the part of the buyer didn't/shouldn't enter into it. Yes they did, and people behaved the way they did. Now the generous refund policy no longer exists. See how that works?

The policy even assumed some amount of semi-bad faith behavior, the thinking was their return policy was also a bit of a charity program for the needy and destitute[1] (a Costco member lost their job and so returns a bunch of items for cash, etc). What they didn’t anticipate was the sheer number of people who began acting in bad faith (and the deflationary nature of electronics making it especially tempting), it was too much to bear.

It’s a shame the policy is gone. There was really no peace of mind quite like it, knowing that if your device failed after years of use, but still due to a defect, you had recourse. And for poor people, it was a godsend of a program especially (and not because it could be abused, but simply Costco providing a service that anything you buy will work as advertised)

[1]source: some internal training I received back in 1998

Yep. The same thing happened with LLBean. They used to offer lifetime returns/warranty replacement on all items, which worked when people acted in good faith. After many decades of this policy, a gray market of used LLBean items emerged, people would buy multi-decade-old used LLBean items, then "return" them as worn out for a new one or even a full refund. It became a whole cottage industry, and they now have a one-year limit on their any-reason return policy.

People suck, especially when they are disconnected from the human side of business.

I love Costco return policy and we bought a lot of stuff there just because "well, if we don't like it we can just return it anytime" (and we did like it and never returned it) over the years, but I've seen some ridiculous returns there. From people treating returns as a zero-cost rentals to buying a tree, failing to water it until it's dead and then returning it. They still have very generous policy and I would hate to see it ruined by people who're just taking an unfair advantage of it and ruining it for everybody.

Well said. And "This is why we can't have nice things" sums up this whole thread pretty neatly.

Yeah, this is a very real problem, and I've experienced both sides of it as a customer and running an ecom biz. It's very difficult to spot some of these people ahead of time.

It makes me sad. Ebay two decades ago was a lot different. I never got burned back then, and did a fair bit of buying and selling snowboard gear, including boards that get up to around $800 each. There's absolutely no way I'd do that today. Just impossible not to get ripped off on it.

Trust seems to be the main issue for large purchases, but individual retailers cannot (and probably should not) know enough about a customer to trust them.

Could the retail organization use a physically distributed escrow service to somehow tie payment to physical goods delivery? That essentially outsources the "brick and mortar" aspect to a third party and removes delivery risk. Amazon and Currency Exchange, for example, can have a much healthier economic relationship than Amazon and me.

Alternatively, this sounds like it could be addressed as a sort of "consumer protection" insurance similar to my homeowners or auto insurance. I file a claim so insurance covers legitimate large losses. Risk is pooled and the underwriter is the organization that is evaluating my trustworthiness, not the individual retailers.

Just ideas off the cuff, maybe there are huge holes here.

A particularly difficult con to detect and account for.

On eBay fraudsters buy large quantities of eg $1 seed packs, to build up artificial account ratings. Then they try to steal expensive things (didn't arrive, wasn't in the box, arrived broken, etc), and eBay shields the accounts heavily because they favor buyers to an extreme. All the thief has to do is be disciplined about it, buy $40-$50 of cheap items for positive feedback, then go after a $300-$500 item. Sellers can't even leave negative feedback on eBay, which further cuts off a mechanism for at least warning other sellers of a running con (sellers sometimes leave the negative language in the neutral/positive feeback segment instead, which rather points out the absurdity of eBay's broken system).

Sure. Amazon should equally value customers who buy $2 gadgets per year as ones who buys $2000 per year. But somehow business owners (restaurants, SaaS, retail, etc.) learn that complains and refunds from cheap customers are much more common and complaints are not polite. I really do not know why and I did not believe in that. But when you run business you learn fast.

Does this apply to things where it obviously went wrong? E.g. if someone bought a 5lb item, and they pointed out you shipped them a 1lb box-- no refunds even then, if they're an undesirable customer?