5 ms·

Yea one of the greatest lies in ecommerce is “free shipping” and now that Amazon has a near monopoly: “free returns.” In fact in a competitive market businesses

Yea one of the greatest lies in ecommerce is “free shipping” and now that Amazon has a near monopoly: “free returns.” In fact in a competitive market businesses would undercut each other to the point they can’t do free returns, which is why Amazon started introducing it after they gained market share. Both these seemingly pro-consumer policies (along with zero liability on lost shipments) is really just a mandatory upsell (think shipping insurance), but where the costs are opaque and built into what you already paid.

ars 5y ago
The nice thing about free returns is that the merchant gets WAY better pricing from shipping companies. I think people would be OK with a fee for returns, if it wasn't high. But asking people to pay retail for returns is not realistic, and I personally won't shop from stores that make me do that.
blip54321 5y ago
I'm not sure about free returns. Free returns aligns incentive structures to where the vendor loses money if they sell me junk I want to return. I don't do returns hardly ever, because of the hassle factor. I don't buy from vendors who don't support them, because the amount of scammy behavior goes way up.
- chrischen 5y ago
  I do agree that's one of the nicer effects (but it's not the only thing aligning incentives because there are reviews/reputation measures), but it also upsells you on the cost of all the non-legitimate free returns being made (lack of effort in reading product descriptions, "free rentals", general consumer carelessness, "accidental damage", and such). So at the end of the day the consumers still bear negatives of this structure (increased the costs of this), but the retailer benefits from increased sales. Also what you say works more for unique direct-from-manufacturer sales and applies less to commodity products sold by Amazon. There's no need for "free" returns on the PS5 you just bought because that product's reputation is well-known. You're just paying for the retailer's costs to reduce all friction from sales while they get all the benefits.

ars 5y ago

The nice thing about free returns is that the merchant gets WAY better pricing from shipping companies. I think people would be OK with a fee for returns, if it wasn't high. But asking people to pay retail for returns is not realistic, and I personally won't shop from stores that make me do that.

blip54321 5y ago

I'm not sure about free returns. Free returns aligns incentive structures to where the vendor loses money if they sell me junk I want to return. I don't do returns hardly ever, because of the hassle factor. I don't buy from vendors who don't support them, because the amount of scammy behavior goes way up.

chrischen 5y ago
I do agree that's one of the nicer effects (but it's not the only thing aligning incentives because there are reviews/reputation measures), but it also upsells you on the cost of all the non-legitimate free returns being made (lack of effort in reading product descriptions, "free rentals", general consumer carelessness, "accidental damage", and such). So at the end of the day the consumers still bear negatives of this structure (increased the costs of this), but the retailer benefits from increased sales. Also what you say works more for unique direct-from-manufacturer sales and applies less to commodity products sold by Amazon. There's no need for "free" returns on the PS5 you just bought because that product's reputation is well-known. You're just paying for the retailer's costs to reduce all friction from sales while they get all the benefits.