Money Back Guarantees

[Elenny]

Does anyone have experience with 'Money Back Guarantees' in their business, whether it's for products and/or services?

I am wondering if MBGs increase sales by giving the customer a certain insurance for their money.

And if so, does it also increase the amount of requests you get to give money back for no good reason?

While in college I worked for a local magazine that had about 3000 subscribers with one-year subscriptions. One day, out of the blue, the publisher decided he didn't like the magazine business anymore and stopped publishing immediately.

He offered pro-rated refunds to everyone who had time left on their subscriptions, but less than 100 of the people (about 3%) took advantage of the offer, so the company ended up keeping a lot of money.

But I have also heard stories where small business are sunk by offering too many of these guarantees.

I am confident enough in my products and services to offer the guarantee, but I also don't want people sending stuff back just because they have the option to.

I would appreciate your comments and suggestions. Thank you!

[Dani]

Make it troublesome enough to get the money back e.g. return the product. and you reduce the claims.

But I am pretty sure most internet marketing courses will tell you that the longer your money back guarantee is, the better.

Apparently a longer guarantee actually -reduces- the amount of claims. Because people give it more of a fair go before deciding.

[escapee]

But I am pretty sure most internet marketing courses will tell you that the longer your money back guarantee is, the better.

I second that, the standard seems to be at 30 days .

[AndrewJ]

Usually they are a good idea, what type of products are you selling?

Andrew

[JiriNovotny]

If you have a great product in which you believe, money back guarantees are a no-brainer.

I offer 60-day money back guarantees, and the refund rate is like 0.5%.

[Elenny]

Thank you for your responses everyone.

Andrew:

My sister and I are launching a series of books, CDs, and DVDs on addiction prevention, treatment, and resources available in specific targeted communities.

Two years ago we did a test run selling to government agencies and non-profit organizations through seminars, and it went very well, so we're updating the material and preparing to sell it to individuals interested in the topics.

The problem with any addiction is that there are too many factors to consider when it comes to a person getting better, so we're thinking that if some people don't see immediate results they might want to return the material without really trying like they should have (hence the Money Back Guarantee question).

[Caveman Joe]

Elenny: Got a website for this endeavour? Put it in your signature. It's not gonna do anybody any good if you don't tell anyone about it.

[Elenny]

Hi Joe,

The website is not ready yet, but I will put it in my signature as soon as it is. It will still be a few months before we're ready to go with this specific project.