Digital goods: what to do if a customer comes to pick up a purchase in a year?
Recently, I found myself in the role of the wrong buyer of a digital product. Last September, I paid for access to the course, and only this August did I get to watch. But it turned out that it had to be activated within three months and now it’s too late. "You will never guess what happened next !! 1"
No, no, this is not just another post of consumer extremism. I am well aware of my own "foolishness" in this particular situation.
But the fact is that I work in a software company, so we also sell digital intangible products. And for me this was an occasion to think about what options could be in this situation and see what that company would choose.
Well, let's play a case?
First you need to understand what field we play on. In the case of physical goods or services, everything will look and work in a completely different way. We are talking about the digital intangible goods market. What features does it have that are important for this situation?
Each additional sold copy of an already created product costs nothing
Creating a product costs money. Software development, creating a video course, writing a book - all this costs money, time, other resources, etc. But replication, each sold additional copy most often costs nothing. Of course, in the case of a complex product, there may be additional costs, for example, support and so on. But most often, after the digital product has been created - it makes no difference - sell one copy or ten thousand.
Attracting a client costs money
This is hardly a feature of digital products, but yes - attracting customers costs money. SEO, advertising, email marketing, etc. etc. A personal brand, which is the main channel for attracting customers in the information business, also costs money. Each incoming client costs the company some money. And if the company has well-tuned analytics, then it’s even known which ones.
LTV more than the price of a single product
Typically, companies that sell digital products have more than one product in their product line. It can be several programs, several courses, several books. And often, customers who buy one product buy a second, or even a third. In the case of software, this may be additional licenses, or the purchase of an "older version". Thus, for the entire time that the company works with a client, it will receive more money from it than one product costs.
There are other factors that may affect decision making:
I will try to formulate the situation more abstractly, so that it becomes applicable not only for info products in particular, but also for digital products in general.
Situation:
The company received the money - the payment went through, this is not fraud, not social engineering. The rules clearly indicate the period during which the client could pick up the goods, the client agreed to these rules when buying. The product was definitely not picked up - this can be checked by the logs.
1. Provide paid goods
Choosing this option, the company receives a satisfied customer. He knows that even despite the fact that the company was not obliged to give him anything - she went to meet him. This company probably will not cost anything. Yes, she will not be able to sell him the second time that product for which he has already paid. But she gets his loyalty. He can buy another product, or advise the company to someone else. Of the potential disadvantages - the client may begin to abuse the good attitude of the company.
2. Return the money
If the company really wants to meet the client, then it can return the money. Most likely, a year after the purchase it will be technically impossible to make a refund. So you have to look for other ways to return the money. In addition, most likely the company has already incurred expenses by paying a percentage of the payment to the payment gateway, plus taxes. In general, the option is complicated by questions of how to do this and how much to return.
3. Provide other goods for the same amount
If it is really impossible to provide the paid goods, you can offer the customer an alternative - a similar product, which costs about the same. In this case, the company fulfilled its obligations (sort of) and can get a satisfied customer. The customer can still sell other products or upgrades.
4. Provide another product at a surcharge
If the desired product cannot be provided and there is no product similar in value, then you can ask the client to pay the difference and provide him with another, more expensive product. Alternatively, you can put the amount into the “virtual account” of the client so that he can continue to pay for other goods from him. When choosing this option, the company can earn some extra money on this client. But how the client will react to this is unknown. He already paid to get the whole product, and now something else needs to be paid. But if it is vulnerable to sunk cost fallacy , then that might work.
5. Do not give the client anything
In full accordance with the rules, do not give the client anything. The company saves money. The customer remains dissatisfied. Regardless of whether it was by the rules or not, whether he realizes it or not - but if the client gave the company money and received nothing in return, the client will be dissatisfied. Most likely - the company will no longer sell anything to this client. There is a risk that the client will begin to spoil the company's reputation in social networks.
Courses by Dmitry Shakhov - 2 times more than you expect
Everyone who takes Dmitry Shakhov’s courses has the opportunity to take them a second time during the year at no extra charge. And this is not a digital product, but quite a real service. Dmitry checks and comments on the homework of each student. So if someone is taking the course for the second time, this is a double burden.
AppSumo - profitable deals clearly by the rules
At AppSumo, you can buy access to various services at a great discount. Usually this is a lifetime access to the service several times cheaper than the usual price. Everything here is clear by the rules. You can make a refund within 60 days. But you need to register clearly at the indicated time. If you do not have time - then everything, without options. But here we are talking about services, not about digital goods. In services, each additional client is a load. I also assume that this is also due to the fact that AppSumo is an intermediary and these conditions are spelled out in its contract with services. Well, plus - the percentage of non-activated can be part of the calculation of profitability. As is the case with fitness centers and annual subscriptions.
In this hypothetical situation, if a client arrives in a year, and he did not activate the product, I would most likely try to provide a paid product. If it is impossible, I provided another product to the company. I do not consider the option with a refand - it will be impossible to do it directly in a year.
Returning to my situation - my counterparty decided to choose option # 5 and, in strict accordance with the rules, did not give me anything. Well - they are in their own right. And I got a bonus in the form of an idea for an article.
Colleagues who sell software and other digital products - what would you do in this situation? Do you have prescribed procedures for each case? What do you do in unusual situations?
No, no, this is not just another post of consumer extremism. I am well aware of my own "foolishness" in this particular situation.
But the fact is that I work in a software company, so we also sell digital intangible products. And for me this was an occasion to think about what options could be in this situation and see what that company would choose.
Well, let's play a case?
Features of the sale of digital goods
First you need to understand what field we play on. In the case of physical goods or services, everything will look and work in a completely different way. We are talking about the digital intangible goods market. What features does it have that are important for this situation?
Each additional sold copy of an already created product costs nothing
Creating a product costs money. Software development, creating a video course, writing a book - all this costs money, time, other resources, etc. But replication, each sold additional copy most often costs nothing. Of course, in the case of a complex product, there may be additional costs, for example, support and so on. But most often, after the digital product has been created - it makes no difference - sell one copy or ten thousand.
Attracting a client costs money
This is hardly a feature of digital products, but yes - attracting customers costs money. SEO, advertising, email marketing, etc. etc. A personal brand, which is the main channel for attracting customers in the information business, also costs money. Each incoming client costs the company some money. And if the company has well-tuned analytics, then it’s even known which ones.
LTV more than the price of a single product
Typically, companies that sell digital products have more than one product in their product line. It can be several programs, several courses, several books. And often, customers who buy one product buy a second, or even a third. In the case of software, this may be additional licenses, or the purchase of an "older version". Thus, for the entire time that the company works with a client, it will receive more money from it than one product costs.
There are other factors that may affect decision making:
- physical impossibility of providing a product or equivalent
- sales overhead
- the inability to go beyond the rules and debugged processes
- legal aspects
Description of the situation and options for action
I will try to formulate the situation more abstractly, so that it becomes applicable not only for info products in particular, but also for digital products in general.
Situation:
- customer paid money
- the client did not pick up the digital goods at the right time
- the client returns in a year and wants to get something for his money
The company received the money - the payment went through, this is not fraud, not social engineering. The rules clearly indicate the period during which the client could pick up the goods, the client agreed to these rules when buying. The product was definitely not picked up - this can be checked by the logs.
Company action options
1. Provide paid goods
Choosing this option, the company receives a satisfied customer. He knows that even despite the fact that the company was not obliged to give him anything - she went to meet him. This company probably will not cost anything. Yes, she will not be able to sell him the second time that product for which he has already paid. But she gets his loyalty. He can buy another product, or advise the company to someone else. Of the potential disadvantages - the client may begin to abuse the good attitude of the company.
2. Return the money
If the company really wants to meet the client, then it can return the money. Most likely, a year after the purchase it will be technically impossible to make a refund. So you have to look for other ways to return the money. In addition, most likely the company has already incurred expenses by paying a percentage of the payment to the payment gateway, plus taxes. In general, the option is complicated by questions of how to do this and how much to return.
3. Provide other goods for the same amount
If it is really impossible to provide the paid goods, you can offer the customer an alternative - a similar product, which costs about the same. In this case, the company fulfilled its obligations (sort of) and can get a satisfied customer. The customer can still sell other products or upgrades.
4. Provide another product at a surcharge
If the desired product cannot be provided and there is no product similar in value, then you can ask the client to pay the difference and provide him with another, more expensive product. Alternatively, you can put the amount into the “virtual account” of the client so that he can continue to pay for other goods from him. When choosing this option, the company can earn some extra money on this client. But how the client will react to this is unknown. He already paid to get the whole product, and now something else needs to be paid. But if it is vulnerable to sunk cost fallacy , then that might work.
5. Do not give the client anything
In full accordance with the rules, do not give the client anything. The company saves money. The customer remains dissatisfied. Regardless of whether it was by the rules or not, whether he realizes it or not - but if the client gave the company money and received nothing in return, the client will be dissatisfied. Most likely - the company will no longer sell anything to this client. There is a risk that the client will begin to spoil the company's reputation in social networks.
How do others
Courses by Dmitry Shakhov - 2 times more than you expect
Everyone who takes Dmitry Shakhov’s courses has the opportunity to take them a second time during the year at no extra charge. And this is not a digital product, but quite a real service. Dmitry checks and comments on the homework of each student. So if someone is taking the course for the second time, this is a double burden.
AppSumo - profitable deals clearly by the rules
At AppSumo, you can buy access to various services at a great discount. Usually this is a lifetime access to the service several times cheaper than the usual price. Everything here is clear by the rules. You can make a refund within 60 days. But you need to register clearly at the indicated time. If you do not have time - then everything, without options. But here we are talking about services, not about digital goods. In services, each additional client is a load. I also assume that this is also due to the fact that AppSumo is an intermediary and these conditions are spelled out in its contract with services. Well, plus - the percentage of non-activated can be part of the calculation of profitability. As is the case with fitness centers and annual subscriptions.
What would I do
In this hypothetical situation, if a client arrives in a year, and he did not activate the product, I would most likely try to provide a paid product. If it is impossible, I provided another product to the company. I do not consider the option with a refand - it will be impossible to do it directly in a year.
What did you do to me?
Returning to my situation - my counterparty decided to choose option # 5 and, in strict accordance with the rules, did not give me anything. Well - they are in their own right. And I got a bonus in the form of an idea for an article.
Colleagues who sell software and other digital products - what would you do in this situation? Do you have prescribed procedures for each case? What do you do in unusual situations?
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