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What Happens When E-Commerce Goes Wrong?

Use caution, sense to avoid being tangled in a shopping Web.

By Tom Spring, PCWorld   

Think again.

This year, holiday shoppers are skipping the crowds and shopping online in droves, putting e-commerce to the test. But the truest test of e-commerce will be customer service when it comes time for refunds, returns, and exchanges.

Experts say that starting the day after Christmas, the convenience of online shopping could vanish faster than Santa. The consensus: Pray that new fleece jacket fits.

Nearly half of the major e-commerce Web sites maintain sub-standard customer service, according to a recent Jupiter Communications study.

"Unless sites have improved in the past month, most are not staffed appropriately or don't have adequate systems in place," said Ken Allard, a Jupiter analyst.

Jupiter found that 42 percent of Web sites surveyed either never responded to customer inquiries, took more than five days to reply, or didn't offer e-mail responses to reported problems. This could suggest major post-holiday headaches for online consumers, Allard said.

Holiday Hangover

Most major retailers post links to their return and exchange policies at the front of their sites. I easily located policies for Kmart.com and the Gap Online. However, both sites directed me to their real-world stores if I had a problem with merchandise. Worse was discount superstore Wal-Mart, which offered neither a policy nor an address to return merchandise.

I'm comfortable dealing with companies like Kmart, which operates 2100 stores. But what happens if I can't get to the brick-and-mortar equivalent? A Kmart representative told me over the phone there is no way to exchange an item purchased or received as a gift without visiting a Kmart store.

The same goes for a host of other online retailers, which haven't thought about what happens when e-commerce goes wrong.

Yahoo Thought It Through

Yahoo explicitly warns customers that it takes no responsibility for the stores it lists in its online mall. The shopping area of the Yahoo search service lists plenty of retailers. Half of those listed I'd never heard of. Most are small companies that hustled themselves onto the Internet just in time for the holidays.

If something goes wrong with an order from one of these merchants, pray they can handle returns. I checked out a couple medium-size online retailers hawking their wares under Yahoo's roof and couldn't find a single return policy.

I shot an e-mail inquiry to one merchant--no answer a day later. I looked for a telephone number to call for the policy, but the merchant apparently couldn't be bothered to answer a phone.

America Online's shopping network, on the other hand, offers an unyielding guarantee--if one of its merchants doesn't come through, AOL promises to refund your money.

"We wanted to raise the bar on customer service so people could have fun shopping online without worrying," said AOL spokesperson Tricia Primrose.

Hindsight Is 20/20

"A lot of companies thought they had reached Internet nirvana," said Randy Busch, director of marketing for Balisoft Technologies. "E-tailers thought to themselves, 'Great, now that I'm online I don't need people anymore.'"

Balisoft is one of a plethora of companies offering programs to meet a growing demand for online customer service. Balisoft makes LiveContact, a real-time chat technology meant to "humanize" customer service.

"First, merchants wanted to just be able to sell online. Now they are figuring out how to take care of customers at their Web sites," said Busch.

You've Been Warned

If you do run into return problems, it might be a case of online buyer beware.

Various consumer-protection groups are now patrolling the online shopping world. There's the Better Business Bureau's BBBOnline certification, and there is the consumer privacy seal of approval offered by TrustE.

These are signs of a trustworthy outfit. But the best-intended policies can go awry when the Christmas crush bears down on the even the largest of retailers.

Consumer problems on the Internet are on the rise, judging by the number of customer complaints compiled by the National Association of Consumer Agency Administrators and the nonprofit Consumer Federation of America.

The NACAA reported in a November survey that top Internet e-commerce complaints were: failure to receive goods or services ordered, damaged merchandise, problems obtaining refunds on returned goods, overcharging, and false or misleading advertising.