When a High Refund Rate Can Actually Be a Good Thing For Your Business

They have a unique mechanism for attracting clients


Shlomi Shraga

3 years ago | 2 min read

I hear and read a lot about business owners that charge upfront for their products, and when asked why not give a free trial period to attract more buyers they reply that their afraid people will take advantage of their generous offer and buy with the initial intention of asking for a refund.

So if you can relate to this - here's a story

One of the greatest publishers in the last 50 years is Rodale.

They've been publishing personal health books since the 60's, and they're still running strong, making 9 figures just from selling books and magazines.

They have a unique mechanism for attracting clients -

They NEVER charge in advance. All credit cards are charged 30 days after the book was shipped, so the customer can get it, read it, try it out and see if he likes it or not.

9 figures, for more than 50 years.

If that doesn't prove something about refunds then nothing will.

OK, so you still want some more proof?

Gary Halbert, the great direct response marketing guru said giving a 30-day free trial will triple your sales and double your refund rate.

So would you agree to endure double the amount of refunds if it'll triple your sales?

I'd go for it any day! (If you don't want to mess with the refunders just hire a VA to take care of all that)

See, when you give a 30-day risk-free guarantee you're saying something to your customer -

Your saying "I'm the one risking my money on you" and not the other way around.

Now that's a powerful statement.

True, there are some low lives that'll take advantage of this kind of offer, but that's negligible compared to the many honest customers who'll take you up on your offer just because they feel they have nothing to lose if your product or service does what you claim.

So actually, a high refund rate can teach you one important thing about your product or service -

It's not living up to your customer's expectancies

So take a refund as a feedback.

One of the best ways to improve your product or service and bond with your market is to survey a refunder -

Get on the phone with him or send him an email to get his feedback.

The worst that can happen is if he's just a freebie seeker than you can blacklist him forever so you don't have to deal with him again.

But if he's genuinely disappointed in your product or service, his feedback may be the most valuable you can get, and by contacting him you've shown him you care - he may forget his bad experience but he won't forget how well you treated him.

Honesty, hospitality, and respect for your customer's opinion go a long way in these crooked times.


Created by

Shlomi Shraga

Shlomi is a marketing strategist and sales copywriter. He helps startups and small businesses increase revenue and profits through effective sales messages guaranteed to convert.







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