The Return Policy Paradox

The guy wasn’t even shy about it.

Amazon’s my rental service,” he told me.

“Bought a 3D printer to make some prototype parts, used it for a week, then returned it. Said I wasn’t satisfied with the quality.”

I’ve known people to buy tents at Costco for outdoor events, big-screen TVs for Super Bowl parties or laser levels for one-off projects, knowing they’ll return them after.

Perfectly clean, barely used, perhaps, but definitely not what return policies were meant to enable.

It’s not a new phenomenon.

Decades ago when my wife worked at a department store that had a “Goods Satisfactory or Money Refunded” policy, customers would return antiperspirant-stained dresses after a party weekend.

This reveals something not very pretty about consumer psychology.

Liberal return policies like Costco’s and Amazon’s were designed to reduce purchase anxiety.

Trust the customer, right?

Instead, these policies created a new behavior pattern where temporary ownership becomes a strategy, and the line between trying and buying gets blururur-y. 😵‍💫

One reader of I Need That told me he buys things constantly on Dog Brain impulses. “And I return TONS of that sh**.”

For product makers, this presents serious challenges. Especially with online sales, which are three times as likely to be returned as in-store purchases.

Every return means increased handling costs, inventory uncertainty, and potential brand damage. Products that come back “barely used” usually can’t be resold as new.

Amazon is known to landfill mountains of stuff like this, with up to one-third of returns deemed unsellable. And commonly, a previously returned item that is sold again leads to a negative review.

Yet tightening return policies can backfire. When Costco briefly tried to limit electronics returns to 90 days, their sales dropped.

Members had come to see liberal returns as part of the value prop.

Some brands are finding creative solutions through improved trial programs, rental options, or membership-based borrowing services.

The future might not be about stopping returns — but about making them (and return shipping costs) part of the business model.

Action for you: Calculate your true return costs, including handling and brand impact. Then brainstorm how these same customer behaviors could become opportunities rather than problems.

What’s your take on “buy to return” behavior?

Laurier

P.S. A product maker recently told me they factor in one “rental use” return for every ten sales. That’s just reality now.

P.P.S. A friend told me yesterday that “I Need That” is now available at our local library.
So I drove over there through a bit of a blizzard to grab a pic of it on the shelf.

Guess I shouldn’t have been disappointed, but I could have checked online and saved myself the trip! 😆