The No-Risk, 100% Money Back Guarantee is one of the oldest and most widely used tricks in use by marketers today. Although technically, the Money Back Guarantee is not a scam because they almost always disclose the terms, the way in which they disclose these terms is often so deceptive that the average person is led to misunderstand the details or misses the disclosure completely. It’s this intentional deception that lead many to call it a scam, and what leads AdFibs.com to try and explain it so you don’t get scammed!
How the Money Back Guarantee Works:
In it’s simplest form, the scam works like this: You see something advertised for the low price of only $19.99. The $19.99 is the “purchase price”. To sweeten the deal, you may sometimes be offered a second product or other up-sell for free.
But here’s the catch. Even though the purchase price is $19.99, you must also pay shipping. Shipping can cost anywhere from a few dollars, upwards of $25 or more (much more for large products). You must also pay “handling” (nobody seems to know what this is), which can cost anywhere from $1 to $50. Some products also require a “fee”. There is usually no description of the fee or what it’s for, it’s just “a fee”. The cost for this fee can also be anything from $1 to $50. Finally, you may also have to pay sales tax. Sales tax is usually based on your state or county and varies throughout the country.
But there’s more!
If you opt for the “free” product or other upsell, even though the product is free, you must still pay all of the other shipping, handling and other ‘fees’.
Here is an example breakdown of actual out-of-pocket expense based on a recent TV commercial review:
- The product purchase price: $19.99
- The second, ‘free’ product purchase price: FREE
- Shipping & handling for the first product: $12.99
- The “fee” for the first product: $7.99
- Sales tax for the first product: $1.60
- Shipping & handling for the free product: $12.99
- Fee for the free product: $7.99
- Sales tax for free product: $0
Total out of pocket expense for your products: $63.55
But it’s ok, because if you don’t like the product for any reason, you get your money back, right? WRONG
Should you take advantage of the money back guarantee (if you qualify, see below!), you will only get back the purchase price of $19.99 and the sales tax! The remaining $41.96 is not included in the guarantee and you will never see that money again.
Usually the additional fees and the “purchase price only” part of the Money Back Guarantee is written in such small lettering, if mentioned at all that many people simply miss it, or if they do see it, do not understand it. It is this deception and misdirection that lead many people to call the whole thing a scam, even though technically and legally, it is not a scam. Buyer beware!
Requesting your money back guarantee:
Some companies make it so difficult to obtain the details on how to request your money back, that it is virtually impossible. Not completely impossible, but difficult enough that many people may give up out of frustration or time spent. An example of this, is a for a product who’s TV commercial AdFibs.com reviewed not long ago. The company or it’s ‘call center’ is based in India. When people call in asking for information on obtaining a refund, they are given another number to call which goes to a confusing recording requiring them to call another number, which was the original sales number! This led customers in a never ending circle. When asking the sales people about the guarantee or how to get a refund, they are simply greeted with ignorance or “that is not our department”.
Another twist to the Money Back Guarantee is that the company may require all original packaging and paperwork and may also require the product to be in 100% original condition. Most people will not keep all packaging and paperwork, making it impossible to claim their money back.
Will the company even be around for a “lifetime” ?
Many products offer a “lifetime replacement warranty” or guarantee. It is important to remember that there is no guarantee that in 1, 3, 5, or 10 years the company will still be in business. If the company vanishes, your lifetime guarantee vanishes with it.
Most people are just too lazy:
Finally, the companies know that a large percentage of people are simply too lazy to bother, or to follow-through with the money back process. Even if the product is complete junk, and 100% the people are unhappy, the company knows that statistically, only a very small number of people will actually apply to get their money back. By making the process as difficult as possible (see above) and by only ever refunding a small amount of the actual out-of-pocket expense to customers that actually succeed, the company is still able to stay very profitable.