Hmm, as someone who also sells a digital product, I have to disagree. I'm very generous with refunds. I figure a reputation for great customer service more than makes up for the small amount it costs me.
Sure, there's nothing, literally nothing, stopping someone from downloading my entire 40-hour+ back catalog, unsubscribing, and asking for a refund. They could also sign up for the free trial, download everything, and unsubscribe.
Or they could just pirate everything. And there's nothing I can do to stop it.
So who would I hurt by refusing to offer refunds: The freeloaders? Or the legitimate customers who gave my product a try and found that it didn't fit? Maybe I'm naïve, but I think that positive word-of-mouth a friendly and prompt refund will benefit me more in the long term.
I know that if I got a non-functional product and couldn't get a refund, I'd be livid. I'd execute a chargeback so fast their head would spin, and I would badmouth the company involved for months.
How's your business going with this approach? I actually suspect your reasoning here is correct, but I'm always curious to find out how a business is faring using this customer-friendly approach.
Almost all the refunds I process are due to people getting busy, no longer using my service [1], and forgetting to cancel their subscription. When somebody sends me a cancellation request right after they've been billed, I volunteer to refund the payment. Perhaps half of them take me up on it.
Even with this proactive approach, my refund rate is only about 1%. It's not affecting my profitability in any significant way.
The benefit is harder to measure. I typically get a warm thank you from offering and, as I said, about half decide to stay subscribed for the remaining month. I've also had people tell me how much they appreciate my "no DRM" policy. So I'd say that my general attitude of trusting and respecting my customers pays off, but it's impossible to say how much.
>> "As someone who sells a digital product, I completely understand the No Refund policy."
I don't. There games are DRM'd and when I FINALLY got a 'refund' (best I could get was store credit) they disabled the game anyway so it's not like I could get my money back and still have the game.
You have an account per game? Because otherwise steam will revoke your access to the rest of your games if you try this approach. In general, teh better approach is to read reviews and watch gameplay videos.
In which case they'd find themselves sued if they pulled that on me, and that's the approach everyone should take to that kind of customer hostility.
Small claims courts / magistrate court filings are cheap pretty much everywhere, and does not require a lawyer. But it would tie up some exec and someone at their law firm for enough time that it'd be a loss for them whether they in or lose.
And in the EU at least they'd also face a near guaranteed loss in most countries if they tried to punish a customer for taking advantage of their rights to return a product that did not work as advertised.
Sure, there's nothing, literally nothing, stopping someone from downloading my entire 40-hour+ back catalog, unsubscribing, and asking for a refund. They could also sign up for the free trial, download everything, and unsubscribe.
Or they could just pirate everything. And there's nothing I can do to stop it.
So who would I hurt by refusing to offer refunds: The freeloaders? Or the legitimate customers who gave my product a try and found that it didn't fit? Maybe I'm naïve, but I think that positive word-of-mouth a friendly and prompt refund will benefit me more in the long term.
I know that if I got a non-functional product and couldn't get a refund, I'd be livid. I'd execute a chargeback so fast their head would spin, and I would badmouth the company involved for months.