
Ask HN: Did offering a money-back guarantee help your business? - nCHc
I assume it will boost initial conversions significantly, but does it produce a long term net gain?<p>As a consumer, I&#x27;ve seen approaches ranging from very generous &quot;no questions asked&quot;, to &quot;you can have a refund if you jump through 100 hoops&quot;, to &quot;all sales are final&quot;. Are there any guidelines around which approach to use?<p>I&#x27;m specifically concerned about one-time digital purchases, where once the customer has the file&#x2F;valuable info there&#x27;s nothing to stop them from keeping it and requesting a refund.
======
theNJR
I was the CMO for a unicorn CPG[0], so slightly different take since we sold a
physical product.

We went crazy with our money back guarantee. We had countless people whose
'dog' ate their product while still on the doorstep. One person said their
cows ate $250 worth. Another person bought a few hundred dollars worth used
from someone on a random forum. They all wanted a full refund. A newly hired
email marketing coordinator mistakenly sent an offer for free product to
50,000 existing customers that was meant for a small group of new customers.

In every instance, we didn't think twice and gave them what they wanted. The
outlier bad actors didn't make a dent when you looked at the entire business.

The philosophy that they were exploiting is what made us worth $1bn.

[0][https://www.inc.com/profile/quest-
nutrition](https://www.inc.com/profile/quest-nutrition)

~~~
WrtCdEvrydy
You'd be surprised how few people are willing to be bad actors.

The other thing is that tests have proven people trust more if you offer a
warranty or even a money-back warranty.

Skullcandy headphones are a great example, they're budget headphones that are
nothing out there, a little pricy but they have a lifetime warranty. What's a
lifetime warranty? They'll replace them as long as you are alive.

~~~
sct202
You just have to be careful if the bad actors start to recruit other bad
actors. There are discords and Facebook groups that are dedicated to sharing
where you can exploit a generous policy or error.

~~~
WrtCdEvrydy
There's a difference, I've seen plenty of people pile into pricing errors on
websites.

Noone's buying 500 headphones just to return them a money back guarantee.

The only issue you'll have is people abusing the crap out of stuff and
expecting a money back guarantee.

------
ggambetta
Waaaay back in the day, when I was running my game development company [1], I
put that on the website - an unconditional, no questions asked money back
guarantee. As you said, nothing stopped customers from keeping the game.
However, in 10 years or so selling games, only a handful of people ever asked;
and I complied, of course.

Focus on the customers who _are_ willing to pay. Invest the time and energy
you'd spend fighting pirates, fraudulent requests for returns (as defined in
this post), etc, in making a better product.

I do have some really fun stories about antagonising the pirates - but do it
as a hobby, not as part of your business strategy.

[1] [http://mysterystudio.com](http://mysterystudio.com)

~~~
sametmax
Besides, you can ban credit card number of abusers. It's easy to create an
email, it's harder to get a new credit card.

~~~
chrismeller
It’s not hard at all to get a new credit card. Report it lost and get a new
one. In the US I’ve never seen a bank charge for it, and several times have
simply gotten a new one sent to me unprompted because the bank had been
informed the card was compromised. Sure it’s not the same as creating a new
gmail account, but it’s still incredibly easy.

Also, banning credit card numbers is going to be problematic... most smaller
operations are not (and should not) be handling their own payment processing
and should never have access to card info. Even if you do and you hash it to
match against that’s iffy from a security perspective and would likely run
afoul of any decent PCI auditor.

~~~
vertex-four
Stripe will give you a “fingerprint” of a card that you’re allowed to do
whatever you want with, and recommend that you use that to block cards.

~~~
patio11
Yep. You can either write code for it or use Radar to block the charge by
fingerprint (write a rule once in your Stripe dashboard to block cards on a
blocklist, add a fingerprint to the list when you identify an abusive
customer, done). This lets you block a card without ever contaminating
yourself with knowledge of its number (we expose the fingerprint in a variety
of places to you, like API responses or on the charge detail page in the
Dashboard).

[https://stripe.com/docs/radar/lists](https://stripe.com/docs/radar/lists)

~~~
sametmax
French here, but isn't it a typo ?

"Use this list with so payments by these customers are always allowed
automatically."

~~~
patio11
Thanks, will get it fixed.

------
SatvikBeri
As a consultant, offering a limited money-back guarantee was a huge boost to
my business. I'd offer something like "if after 2 weeks, you don't like my
work, we can cancel the contract and you don't have to pay anything."

By doing this I was able to charge literally twice as much – one of people's
biggest concerns with a freelancer is that they have very little idea of how
skilled you actually are. And no one ever asked for a refund.

(I was also pretty careful with my client selection though – I'd bring this up
towards the very end of a negotiating phase, to avoid adverse selection.)

~~~
seanwilson
> As a consultant, offering a limited money-back guarantee was a huge boost to
> my business. I'd offer something like "if after 2 weeks, you don't like my
> work, we can cancel the contract and you don't have to pay anything."

> By doing this I was able to charge literally twice as much – one of people's
> biggest concerns with a freelancer is that they have very little idea of how
> skilled you actually are. And no one ever asked for a refund.

Not doubting you but how were you able to tell that was the influencing
factor? Did anybody hint they were concerned they might not be happy with the
final product?

Do you ask for any money upfront? I've heard of some people asking for 100%
upfront with a refund guarantee.

I'll usually get some portion upfront and the rest on completion so they know
they can withhold something if they're not happy.

~~~
SatvikBeri
Well, I can't know for sure. I went from charging $X/week and getting lots of
resistance to charging $2X/week with the guarantee and getting almost no
resistance, and several clients specifically mentioned the guarantee.

I didn't ask for anything up front then, but I probably would now that I have
an established career and more options (although I'm not consulting anymore.)

Edit: also, $2X was honestly well above my market rate at that point, I
charged that much initially because I was already booked. But that's more
evidence that the guarantee tactic worked.

~~~
seanwilson
You should consider charging fixed costs instead of hourly as well. It's
easier for clients to make a business decision of your cost when they've got a
guaranteed outcome.

~~~
SatvikBeri
I actually tried that! Then a project took 5x as long as I expected, mostly
due to problems outside my control. Never again.

~~~
seanwilson
Why did it take 5x longer and why was it outside of your control? Could you
have changed the terms about which part was fixed price to fix this?

~~~
SatvikBeri
Note that I charged by week, not by hour, which eliminates a lot of these
issues.

The problem with the project was essentially that the data was incredibly
messy, and by the time I found this out the project was already well underway.
So I could have abandoned the project, lost the fee, and screwed over my
client...or put in a bunch of extra work to get the project over the finish
line. I chose to do the latter.

I'm not confident enough in my ability iron out all such uncertainties in
future projects – software is already hard to predict at a job, and even
harder with new clients. Charging by week seems like the best compromise
overall.

~~~
seanwilson
> Note that I charged by week, not by hour, which eliminates a lot of these
> issues.

A fixed number of hours per week? How did you keep the client happy when they
wanted to know how many weeks?

One issue is if you work smarter or faster is you're not going to earn more
and there's only a fixed number of hours in the week. Your client is likely to
be unhappy in the end when the costs get out of control too.

> The problem with the project was essentially that the data was incredibly
> messy, and by the time I found this out the project was already well
> underway. So I could have abandoned the project, lost the fee, and screwed
> over my client...or put in a bunch of extra work to get the project over the
> finish line. I chose to do the latter.

\- Could you have asked to see the data first to avoid this?

\- Could you have offered an initial paid discovery phase that would have
given you time to go over things in more detail first and even prototype it?

\- Could you have broken the project into chunks where some parts were fixed
price and the really unsure parts were hourly?

~~~
SatvikBeri
Not a fixed number of hours per week – more like "Here's the project proposal,
I estimate it'll take 5 weeks, here's roughly what I expect to get done each
week." Some weeks would be easier than I expected and I'd get ahead, some
weeks would be harder and I'd end up working more. If a major event happened
that would make the project take a lot longer, I'd renegotiate.

> \- Could you have asked to see the data first to avoid this?

> \- Could you have offered an initial paid discovery phase that would have
> given you time to go over things in more detail first and even prototype it?

> \- Could you have broken the project into chunks where some parts were fixed
> price and the really unsure parts were hourly?

I could, but (1) most of my projects are quite different from each other, so
the risks change, (2) the benefit seems pretty small. My clients weren't
clamoring for more predictable costs – mostly they wanted transparency if a
project was going to take longer than expected, as well as the ability to wrap
up or cut scope if that was the case.

------
dalbasal
I think this comes in different flavours.

(1) Sales Channel Flavour. This is a guarantee you use to improve conversion
rates, by trying to remove any reluctance possible. This is usually where you
find the "hoops" to lower the number of actual claimants.

Generally, highly optimized sales "funnels" are found in segments with high
margins & high advertising costs. A 5% return rate is no big deal if you spend
40% on media/advertising.

(2) Heirloom Product. Say you sell a $500 camping knife. It's designed to last
generations. Besides marketing, a lifetime guarantee frames the product
mission in nicely concrete terms, with natural feedback mechanisms. IE,
guaranteeing the product for life helps ensure you make it to last a lifetie.

(3) Just-easier flavour. This is more common now, with
amazon/yelp/charegbacks/etc. Money back might just be the easier way of
dealing with unhappy customers. For a mature company easy=cheap. For a
startup, easy means minimizing "escalations:" Chargeback disputes, Let me
speak to your manager, etc.

You need to watch out for no. 3. It could be in the "do things that don't
scale" category.

~~~
WrtCdEvrydy
For physical tools, you can make the lifetime warranty basically reliant on
returning the product.

'Return your grandfather's knife and we'll send you a new one you can pass
down to your kids... because family matters'

~~~
devonkim
That worked for Sears' Craftsman line-up but they wound up selling that
business and I dunno how it's worked out for the acquiring company since.

------
nickjj
I think so. I'm very happy with my return rate percentage.

My video courses (tech courses on programming / ops) are a one time purchase
and I offer a 1 year money back return policy, no strings attached. The only
reason I even put a time limit on it is because without putting one, then it's
not clear on how returns work or would require too many words to describe a
lifetime return policy.

I'm a developer myself and having a 30 day return policy for information seems
like a high pressure bullshit tactic. People live busy lives and trying to
force someone into watching a 10 hour course RIGHT NOW otherwise they can't
get a refund later on feels dirty.

In other words, I optimize for the happy path. I want to focus on making the
experience as good as it can be for people who are interested in learning
whatever topic they signed up for and aren't the type of person who will buy
it, consume it and then return it.

The dishonest person who will buy your stuff, consume it, and then ask for a
refund will do that with a 5 day, 30 day or 365 day return policy. That's just
the type of person they are.

~~~
tobtoh
> People live busy lives and trying to force someone into watching a 10 hour
> course RIGHT NOW otherwise they can't get a refund later on feels dirty.

Absolutely. This is something I think companies get wrong so often.

As an example, Country Road (a clothing store in Australia) offers loyalty
discounts based on your purchases - $10 reward voucher per $100-249 spend, or
$35 per $250+ spend. Except, those vouchers expire after 30 days.

If I've just spent $250 on clothing, I'm unlikely to make additional purchases
in the next 30 days. Their reward system doesn't encourage me to buy more
clothes (there is only so much I can buy in a short period of time), and it
does the opposite of encouraging my loyalty - it just makes me 'bitter' that
I'm missing out on rewards.

~~~
verall
But they're not after you - they're after people that absolutely will get an
"itch" to buy more clothes within 30 days, and they want to be the retailer
picked.

Now, CVS receipts on the other hand -- often discounts expire within a couple
days and I don't know anyone who shops for toiletries that often. I don't get
it.

~~~
clan
Pass it on to a friend who will now shop at CVS. Primitive (but I think
effective) viral marketing.

~~~
verall
They have a system where the receipts are married to your account so you also
need to give your phone number to your friend.

It's a maniacal system.

------
zeroego
I work in customer service at a medium sized food company. We have a no
questions asked guarantee. I'm somewhat torn on the money-back guarantee
philosophy. I hear people say that it ends up being profitable at the end of
the day. But, it entitles people to complain (and expect compensation) about
every last little thing. I have customers that call and ask if one of our
products is Gluten Free. Nowhere on the label have we stated that it is. Yet,
they are beside themselves to hear that it is in fact not gluten free. I then
have to either send them a refund or a replacement for their own negligence.
I've had to do this for people who have bought our whole wheat flour,
expecting it to be gluten free, because we're known as a company that sells
some gluten free items. Rewarding this kind of behavior, while reinforcing the
BS "customer is always right" philosophy, must be to the detriment of society.
I wish that we (USA) would do away with our conception of customer service and
would adjust to something more akin to what you find in Europe. No facade,
just people interacting, for better and for worse.

I'm ranting now, I guess I say all this to say, I could see having an absolute
guarantee being profitable in the long run, but as the person who has to deal
with entitled whiny consumers, I absolutely hate it.

------
patio11
Ran a business selling one-time digital purchases for years and have talked
with many, many other people with similar businesses. We're basically
unanimous on this: offer the guarantee, reap the marketing win, pull less hair
out when dealing with very annoying customers. They have an attractive
backstopping option if you don't offer the guarantee, which is calling up
their bank and saying "Internet merchant didn't deliver as promised, give me
the money back", which will get the refund anyhow _and_ ding you on a fee (for
processing the chargeback) _and_ increment a counter at the payment processor
that you very keenly do not want incremented above a certain number.

(Above comment in my personal capacity, not speaking as someone who is very
professionally involved with that last clause.)

~~~
vivan
How does this work in line with your views on registration systems? I'm about
to be releasing a product which also is a one-time digital purchase and I plan
on just having a generous guarantee. I was planning on having no licensing
system because frankly it's more headache than it's worth - the target
audience will be happy to pay for the product and people who don't want to pay
won't be paying anyway. Do you think this is a fair assessment? Do you think
it's worth having a very basic registration system or none at all?

------
louisswiss
Yes. There are a few advantages to offering a money-back guarantee for your
product. Especially for a one-time digital purchase:

\- As you correctly assume, conversions will be higher with a money-back
guarantee than without (although you do have to make it obvious that there is
one in your marketing)

\- More importantly, unhappy customers will get their money back either way.
If you don't offer a refund, you'll just have customers making charge-backs
via their credit card provider. These chargebacks are pretty much impossible
to combat for digital products, and can cost you $15-$100+ _on top of the
refund_ per chargeback.

Even worse, too many chargebacks can lead to your payment processor
freezing/closing your account.

~~~
no1youknowz
> customers making charge-backs via their credit card provider. These
> chargebacks are pretty much impossible to combat for digital products

It's not impossible. Companies such as Chargebacks911 worked with Clickbank
which is an affiliate program selling digital content to reduce their
chargebacks quite significantly.

More information here: [0].

Some credit card companies are now electing to work with both Kount and CB911
into their stack.

[0]: [https://www.kount.com/case-studies/clickbank-
chargebacks911](https://www.kount.com/case-studies/clickbank-chargebacks911)

Disclaimer: I don't work with either company but spent the last 2 years
looking at the whole fintech stack for my startup and know (almost) all the
players in the space.

------
acconrad
I run my own consulting firm and I offer a money-back guarantee.

I had one very short-term client who was dissatisfied with our service in
spite of very clear deliverables. Nonetheless, I didn't hesitate for one
second to give them back their money.

In simply offering to give them their money back, they refused the check and
completely shifted their mentality towards us. They became _advocates_ for us
and then said they appreciated our work.

I've never had to give money back with a money-back guarantee and it has only
strengthened our brand.

------
princeofwands
We had a policy of "we only want satisfied customers". Being very forthcoming
and easy-going with a return policy makes support super easy. When people
complained, we pro-actively offered to reimburse them (sometimes they would
even decline). This resulted in three things: It got rid of the
cheapskates/difficult customers early on. It combatted negative reviews. It
pleasantly surprised a few customers enough for them to put in free word of
mouth or add positive reviews, sometimes adding up to 20 new customers. (The
default is for customers to have to jump through hoops, excellent support can
knock them off balance).

We started out with the guarantee and used it prominently in our marketing
copy, so I don't have numbers on conversion rate improvement.

------
RepressedEmu
When we first launched [https://www.Feastflow.com](https://www.Feastflow.com),
a handcrafted lead gen service for freelance developers, we didn't offer a
free trial or a money back guarantee and we got a lot of feedback that it was
necessary. This might be a different perspective since we are a subscription
service but having a "no questions asked" 30 day refund policy has definitely
boosted our conversion and led to a much larger userbase. We found that our
biggest sticking point was getting a user to give us a try and after
experiencing the quality of our leads there is very little chance they ask for
a refund.

------
VBprogrammer
What seems like such a simple question unfortunately is probably quite
difficult to answer. At best you could find someone who ran a high quality A-B
test where the result showed something interesting. But you still have no idea
whether that changed over time after the A-B test finished.

I think the main question is was the number of refund requests significant? If
it was trivial then any marginal benefit is very low risk.

Patio11 has written quite a bit about his experience. Worth having a read of
his blog if you haven't already.

[https://www.kalzumeus.com/archive/](https://www.kalzumeus.com/archive/)

------
octocode
As a customer: if I am on the fence about a product, I will rarely buy
anything that does not offer some kind of money-back guarantee, even if the
cost is only 10 dollars. I've been burned before by buying products or
services that turned out to be trash, and offering a guarantee shows some
level of faith in what your company offers. I've only requested a refund a
small handful of times.

Most recently I bought a $550 dollar online course and the 1 year
unconditional money-back guarantee was 100% the deciding factor for me to try
it. I ended up loving it and will not be requesting a refund.

~~~
golanggeek
What course was it?

------
gtsteve
I don't run this sort of business but I recall reading in a book (I believe
Tim Ferris' 4 hour work week) that he offered a 110% money back guarantee and
in the entire history of his business only one person took him up on it.

I've not seen the 110% money back guarantee in the wild however but it feels
like a memorable offer. You'll have to carefully figure out how to avoid
getting taken advantage of but I feel it might be a worthwhile risk.

~~~
nickjj
This is an old copywriting tactic that has been around for decades. It's the
"too good to be true" policy. It's just a way to make people think "wow, how
does he stay in business!". It really makes you think that their product is
very good.

I vaguely remember some book author having an interesting typo related policy.
His claim was, for each typo reported in his book, he would start out by
paying 1 penny, and for the 2nd typo he would pay 2 pennies then 4 pennies
then 8 pennies and so on. It was a crazy claim because if you double your
pennies 30 times, it's over $5 million dollars. I can't remember who did this,
but how's that for an incentive to buy the book haha.

~~~
tome
Are you thinking of this?

[https://en.wikipedia.org/wiki/Knuth_reward_check](https://en.wikipedia.org/wiki/Knuth_reward_check)

~~~
nickjj
Yep, thanks.

Kind of scary how inaccurate my memory was on the exact strategy, but that's
definitely the one I was thinking of.

------
organicdude
Every marketing tool has it's place.

A guarantee is only useful if:

1\. You need to lower perceived risk of using your product. 2\. You need to
demonstrate confidence in your product.

There are dozens of other conversion problems that won't be addressed by a
money back guarantee.

~~~
ARandomerDude
3\. You need a tie-breaker between your product and your competitor's.

~~~
organicdude
Perhaps. If customers are really doing their research and there is no other
way to differentiate, sure. In a perfectly rational world for sure.

But there is a real cost of offering a money back guarantee: it may be
distracting you from other issues. It may encourage a "throw stuff against the
wall and see what sticks" type of mentality. Which can get you started, but
random experimentation based on "best practices" and "do what the others are
doing" is not the shortest path to very high conversion rates.

The real way to increase conversions is to "sleep with your customers". Get to
know them so well, you know what their heart wants. You know the real reasons
why they want your product or a similar one.

And then fulfill those desires. Give them what they want and explain it in a
way that they understand.

But if you don't know your customer, which takes just a few days of
conversation...well, you're throwing darts on at a "best practices" dartboard.

If you do your homework, you can narrow it down to:

I don't understand your product. I understand your product, but I don't see
how it would help me. I don't trust you. I can't figure out how to do X on
your website. Your product is priced too high/too low.

A money back guarantee does nothing to address to above 5 objections.

------
muzani
We sold some physical products offline and online with 100% satisfaction
guaranteed. Meaning that if they were unhappy with anything at all - quality,
damaged packaging, or just isn't what they expected, we return all their
money. And we empowered/encouraged customer service to give full refunds
whenever they felt necessary.

The people who we offered to return rarely took the offer - they just wanted
someone to listen to complaints. They also ordered 3 times more than the
average. Out of the thousands of customers, nobody abused the system although
we probably should have been more open about the policy.

I've done this earlier offline as a barista. We sold to a target market that
wasn't familiar with overpriced coffee. We didn't want to give free trials,
but every time someone is deliberating on it, we offer to return their money
100% if they buy a cup but didn't like it. No abuse, but it created a lot of
fanatically loyal customers.

Tim Ferriss recommends doing a 110% return policy instead, which is probably
more well suited if you expect them to do returns.

------
Sileni
I'm gonna flip this on its head a bit; I've been that "bad actor" in the past,
when I honest to god could not afford a course/book/whatever. Not "This will
cut into my entertainment fund", more "I won't be able to pay rent if I pay
for this".

I'm not in that position anymore, but a lot of my later purchases were based
on what I learned while I was broke. Now I naturally default to O'Reilly
books, for example, if I want a technical manual. Mostly because I downloaded
a handful when I was in college.

If you're expecting your company to be around a while, there's a section of
customers which will "abuse" your money-back guarantee, then later buy
products from you legitimately, that wouldn't be accessible if you made it
difficult to abuse the guarantee in the first place. And as many people have
stated here, the "abuse" ends up being only a handful of people to begin with.

~~~
billmalarky
This reminds me of Bill Gates comment that went something along the lines of
"If they are going to be pirating software, I want them to be pirating _our_
software."

------
bastawhiz
I've always promised a refund to any customers asking in good faith. I run a
podcast hosting company, and not every solution out there is right for
everyone.

Most users requesting a refund made a mistake. I'm happy to refund them or
offer credit, and the reputation I've built for customer support is well worth
the cost. It comes out to tens of dollars a month in exchange for priceless
unsolicited recommendations on social media (even from former customers and
folks who haven't used the service).

There have been a few bad actors. One user demanded a refund for six months of
service (we bill monthly) after finding that the service did not meet his
needs. He did not receive the refund that he demanded. Of the hundred or so
refunds that I issue each year, maybe one or two are not what the customer
asked for.

------
noodle
A lot of good answers already, but to add a slightly different perspective:

I'll always add a money back guarantee to any SaaS product where it makes
sense. I believe it helps conversions, but I don't have data to back that up.

What it really does is help more easily identify the type of customer who
would be a pain in the ass and costly to support, and give an easy way to fire
them without it being a straight up "we don't want your business". Instead,
its a "we're sorry we didn't live up to your expectations, per our guarantee,
we're refunding you your last month and deactivating your account." or
something to that effect, with variations based on circumstance. It turns a
likely negative customer support interaction into a potentially positive one.

------
crankylinuxuser
> "all sales are final"

If you take credit cards, no sale is _final_ until the CC company finalizes
settlements. The times for this can vary depending on card handler.

I know I use this to defend myself against unscrupulous or otherwise
questionable merchants. But this can be easily turned to a bludgeoning weapon
for customers to get their own way.

Anecdotally, I know over on reddit /r/ulpt "buying" and disputing or
chargebacks are seen as getting free swag. Unethical in the extreme, but it
works. The CC companies don't want to alienate customers from legit and bad
transactions.

~~~
pbhjpbhj
The Consumer Rights Act in the UK limits claims for refunds for supply of
defective goods to 6 years IIRC, so it's not just credit card companies who
will reverse a transaction _ex post facto_.

------
mimixco
Several brands got famous doing this. One of the earliest that comes to mind
is Craftsman. You could return anything they made even years later, without a
receipt. Nordstrom is also famous for this same policy. Amazon basically has
this policy today, as does NewEgg. So does the kitchen goods company Zwilling
J. A. Henckels.

Even though it seems like digital products might be easier to rip-off, they
have nearly no cost to produce -- so the risk is higher for a seller of
physical goods. They'll incur the cost of giving you a second product or
refunding your money after you've used up a product so that it can no longer
be sold again.

In selling services, I've always offered this policy. Few very people will
take me up on it -- far less than 1%. Probably 0.2% in total. Knowing they can
get their money back if not satisfied gives new customers the confidence to
try me for the first time and encourages existing customers to spend more.

Studies have shown that most of your new business will come from existing
customers. In this case, the cost of acquiring that business is probably less
when it's just giving them a product (or a refund) vs. trying to acquire them
from the market as a new customer through advertising.

------
franze
this is my money back guarantee for my workshops[1]

    
    
      >If you state after the workshop:
      >
      >that you care less about SEO now - and
      >that you learned nothing new - and
      >that your understanding of SEO has not been improved - and
      >that you have the feeling that you have wasted your time
      >then i will not take your money! I will even invite you for lunch that we can talk about why i failed you.
      >Note: that's a logic "and" (think &&, not an ||)
    

i never had to pay anything back and it takes some preasure out of the
investment - if it's a private person wher the invested money matters. i got
some positive feedback for it and it's another marketing opportunity.

for books sold over the internet there is a 14 days money back gurantee anyway
in the EU, but nobody ever used it anyway [2]

[1]
[https://www.fullstackoptimization.com/workshop](https://www.fullstackoptimization.com/workshop)

[2] [https://www.fullstackoptimization.com/b/understanding-
seo](https://www.fullstackoptimization.com/b/understanding-seo)

~~~
Waterluvian
I like your intent, but speaking as a social hermit, if I read this, I would
just be scared to ask. To me, it reads as an entrypoint for an uncomfortable
pressured sales pitch.

What I want to hear is:

"If you finish the workshop and you feel like you wasted your time, I will
give you your money back."

And then feel free, after politely saying, "I'm sorry this wasn't your thing,
here's your refund", please do ask some "why" questions. If I'm eager to talk
about it, then feel free to ask me to lunch.

Just don't make it sound like my refund is walled behind a lot of conditions
and even more effort.

~~~
franze
most of the time it's actually a good starting point for discussions after the
workshop, as they can tell me what they found valuable and what they not found
valueable.'

additionally my audience is devs, so the && vs || distinction makes it clear
that we (can) use the same language

------
quaffapint
I've often wondered which is better for a saas to offer...

Money-back guarantee for x days

-or-

x day Free Trial

...I would think the first would be easier to manage, but will the free trial
pull more people in?

~~~
bachmeier
Speaking for myself, the free trial will always win. If I've paid, that means
they have my credit card number, and it can be hell getting some companies to
stop charging. Of course, that means I only go with free trials that don't
require a credit card number. I know why companies do the things they do, but
I don't care, I'm not going to get sucked into a lengthy, multi-call game to
get them to stop charging my credit card.

------
garganzol
Money back guarantee is a good thing, go offer it. For a customer, it makes a
purchase a no-brainer. For a seller, this is a good way to get rid of a toxic
transaction early without loosing a nerve.

There will be some dudes who will try to exploit your pledge. But there is a
trick: detect them early and use a more aggressive tactics.

For example, when someone claims your product does not work and needs an
immediate refund after 5 minutes since the purchase and getting a license key,
you can politely suggest them to do a chargeback themselves via the bank,
because well, the product has a trial and it just cannot stop working just
after entering the license key.

More often than not, such a customer will restrain from getting a refund and
you will even get some respect points from them for doing a no-shit business.

------
hartator
I am running SerpApi ([https://serpapi.com](https://serpapi.com)).

We do offer money back guarantee, but no free trial. Yes, it does increase
conversions but not in a significant way. It’s also an effective way to avoid
chargebacks and keep poeple happy.

------
seanwilson
> I'm specifically concerned about one-time digital purchases, where once the
> customer has the file/valuable info there's nothing to stop them from
> keeping it and requesting a refund.

It's highly dependent on the product and who you're selling to. What are the
specifics?

I have a subscription based Chrome extension [1] that will stop working if you
refund. I offer 7 day refunds in place of my ability to offer free trials
right now. I get minimal refund requests so it's not something I worry about
and I'm not going to invest time in winning over people that don't see enough
value in the product after seven days.

[1] [https://www.checkbot.io/](https://www.checkbot.io/)

------
JunaidBhai
I think money back guarantee has proved out to be one of the most important
feature that converts fence sitters and eliminates free trial of our service.

I am a co-founder at Draftss ([http://draftss.com](http://draftss.com)) which
is a productized graphic design, Web & App UI/UX with code service on monthly
subscription. We offer a 7-day 100% money back guarantee if the customer is
unhappy with the designs we create for them. Offering a money-back guarantee
builds confidence for customer to sign up for our services.

We started 9 months ago and served 100+ customers and received 0 refund
requests till date.

------
jedberg
As a counterpoint to what is seems most people are saying, my friend had a
mail order (and internet order eventually) business for 35 years, and they had
a big sign on the wall of the sales floor that said,

"If you bought the wrong part, you now have a spare".

In other words, they never offered a refund, only replacement of the same
product, and you had to send the old one back to prove it was broken on
arrival.

People loved them and almost all of their customers ordered more than once, so
it didn't seem to affect them much. But who knows, maybe they could have been
a lot bigger offering refunds!

------
paulcole
I did community/support for an app that had a few thousand paid monthly
subscribers.

I made it well know that I would give anyone who asked whatever they wanted
for any reason. Just tell me what went wrong, I'll give you your money back
and then I'll fix it.

People really seemed to love it. Sure there were the cheats who just wanted
something for nothing. But the people who had legitimate gripes ended up being
our biggest fans/champions on forums and Facebook groups.

Was definitely worth it.

------
vinrob92
I am running a fully remote, unlimited design agency[0] with about 25
freelancers and project managers in various timezones.

We offer a 14 days, 100% money back guarantee. We do have some bad actors but
I think the fact that design is highly subjective, the money back guarantee
really convinces customers to try us. Currently we have less than 3% refunds.

[0] [https://www.manypixels.co](https://www.manypixels.co)

------
jkuria
I saw this question and dug up the following useful excerpts. It includes the
'fail safe' "9 Point Checklist for Implementing Guarantees:"

[https://capitalandgrowth.org/questions/1541/have-money-
back-...](https://capitalandgrowth.org/questions/1541/have-money-back-
guarantees-helped-your-sales.html)

------
jliptzin
Don’t worry about a few bad apples taking advantage of a generous return
policy. Keeping customers happy should be your primary concern, even those
wanting a refund. They may even still leave you a good review afterwards!
Plus, if someone’s unhappy and you don’t refund, they’ll just do a chargeback
on their credit card which is much worse than a simple refund.

------
OldSchoolJohnny
Thank you for asking this! I honestly never considered it before as we offer a
free trial up front to combat refunds and make it harder to refund; but it
makes perfect sense after reading all the other answers and has changed my
mind completely.

------
thehodge
We have a small low touch SaaS business with a 30 day money back guarantee,
We've had maybe 3 people ask for there money back in the year of having it but
it didn't affect conversions significantly

------
throwaway5752
I think, at least, that it will motivate you and put you in the bet mindset to
please your customers.

------
anacleto
Yes. [0]

[0] [https://www2.bc.edu/thomas-
chemmanur/phdfincorp/MF891%20pape...](https://www2.bc.edu/thomas-
chemmanur/phdfincorp/MF891%20papers/Ackerlof%201970.pdf)

------
gotthealgo12
If you are in the software industry a trial is going to be requested. 1st
manage expectations example 1user 2 weeks and r u negotiating with a dm Or
sponsor

