Competition among e-commerce companies has led to “refund only”

Why have e-commerce platforms started to implement "refund only"? What is the purpose behind the reform? Let's read the article and see the author's interpretation!

1. E-commerce platforms have started to implement “refund only”

Following Pinduoduo's footsteps, Taobao and JD.com have also launched the "refund only" policy.

On December 26, Taobao issued a public notice, proposing to change the relevant rules for dispute resolution on the Taobao platform, which will take effect immediately.

On December 27, JD.com added new standards for implementing refunds without returns in the "JD.com Open Platform After-Sales Service Management Rules", which came into effect on December 29. At the same time, the "JD.com Open Platform Transaction Dispute Handling General Rules" also added content that supports users to only request refunds, and this adjustment has come into effect today.

It is worth noting that Yilan Business found that the refund-only policy of Taobao and JD.com is different from that of Pinduoduo.

The change in Taobao's rules is that when buyers return goods, Taobao will evaluate the merchant's past behavior based on the platform's big data capabilities. If the merchant has too much negative information in the past, the platform will directly support the buyer's after-sales return and refund or only refund.

JD.com's rule change is that consumers do not need to return the original product during the self-sales process, and merchants can refund consumers through "no return, only refund". Once the refund is completed on the same day, the service order status will directly enter the temporary completion status, avoiding further return procedures.

Pinduoduo's refund process page does not provide much description of merchants and users. It only mentions several times that "Pinduoduo has the right to shorten the merchant processing time limit based on user applications, user complaints, or store after-sales service, etc."

Taobao's refund-only policy is mainly based on the seller's store quality indicators, customer complaints and other negative information. If the relevant scenario is met, it will directly support the refund-only policy. JD.com stated that "JD.com has the right to handle or support consumers' refund-only or return-refund requests according to transaction practices."

Judging from the description, Pinduoduo and JD.com consider users' past behavior data more, while Taobao combines user behavior data with merchant operation data to make judgments.

So how does it perform in actual operation? A netizen placed an order for a product on Pinduoduo and asked customer service what conditions must be met if he applied for a refund only. Pinduoduo quickly responded, saying: Pinduoduo recognized that the merchant did not handle your problem properly and has intervened to handle it for you. Pinduoduo can help you refund the full amount, and you can handle the product yourself. Do you think it's okay?

On Taobao, Yilan Business chose to only refund a courier that had not been received due to logistics abnormalities. Since the author is an 88VIP member and the refund was initiated due to logistics abnormalities, the platform said: Support will give you a refund first.

JD.com customer service told the author that the specific conditions for refund are still subject to after-sales review.

In fact, in September this year, Douyin e-commerce also updated a refund-only explanation in the "Merchant After-Sales Service Management Specifications": "If the product's positive review rate is lower than 70%, the platform has the right to support consumers' after-sales applications for refunds only, or refunds including shipping costs for returns for the product transaction orders. The policy can be lifted if the product's positive review rate recovers to more than 70% for seven consecutive days." Obviously, Douyin uses the "merchant positive review rate" as an indicator to determine whether the refund-only standard is met.

Obviously, compared with Pinduoduo, Taobao and Douyin have based their refund mechanism on more criteria. It is not only about "becoming Pinduoduo", but also about "surpassing Pinduoduo".

2. Why implement “refund only”?

So why did Taobao and JD.com also start to offer refund-only services?

From the user's perspective, refunding only is undoubtedly a measure that is conducive to "returning users" and protects the rights and interests of consumers.

This year, Jack Ma has made two public comments at Alibaba. The first time was in late May, when he said at a small-scale communication meeting of Taobao Group that the next opportunity was for Taobao, not Tmall, and that Alibaba e-commerce should "return to users and Taobao."

When Pinduoduo surpassed Alibaba in market value for the second time, Jack Ma congratulated Pinduoduo on Alibaba’s past decisions and said, “Everyone has been successful before, but only those who reform in order to be successful tomorrow or the day after tomorrow, and those who are willing to pay any price and make any sacrifice, deserve respect.”

Coincidentally, Liu Qiangdong also said on JD.com's intranet this month that "JD.com must change, otherwise there is no way out."

From the keywords such as "user" and "change", it can be seen that Taobao and JD.com are determined to drive user growth in the face of Pinduoduo's fierce offensive.

From the perspective of the platform, the refund mechanism alone can indeed effectively regulate the products and services of merchants to a certain extent. After all, no matter which e-commerce platform, there are always low-quality merchants who like to sell products that "do not match the description". By only refunding, the platform can restrict the operation of such merchants to a certain extent, and enhance the consumer shopping experience from this perspective.

Of course, this move will inevitably bring some risks.

On the one hand, if some netizens take advantage of the mechanism to get free stuff, can the platform accurately determine whether it is malicious and only refund? Even now, you can still see strategies on various content platforms on "how to get free stuff by only refunding". As early as March this year, Pinduoduo broke out about a "store bombing incident" in which a large number of self-operated stores were maliciously ordered by users and applied for only refunds.

On the other hand, refunds are a controversial policy in themselves. From a legal perspective, it is illegal for a buyer to receive a product and then return the payment without the merchant's consent without returning the product. Therefore, merchants can appeal against such transaction disputes. Taobao's user base is larger than Pinduoduo's, and more merchants may face such transaction disputes, which is both time-consuming and profit-depleting. Whether merchants will make up for it by "bad money driving out good money" is also a question.

Ultimately, the problem is that even if the e-commerce platform's refund decision is based on big data, it has not yet been proven whether it can be fair.

Whether the platform, merchants, and users can form a reasonable balance in 2023 will determine whether the move of each e-commerce platform can proceed as expected. After all, merchants constitute the platform, and if the platform hurts the relationship between the platform and the merchants in order to attract users, it will not be worth the loss.

Author: Li Yan; Editor: Xue Xiang

Source public account: Yilan Business (ID: yilanshangye), a professional consumer service platform.