Tag Archives: Amazon

Online Returns Are Going to Cost You

In the last few months, a number of large retailers have started to pump the brakes on returns for online purchases. Yes, it always starts south of the border, but will be here pretty quickly.

According to NRF research, the online return percentage in 2019 was 8.1% but jumped to 16.5% in 2022. That’s expensive for retailers and they’ve started to work on reducing that percentage.

Macy’s has implemented a $10 fee and H&M one for $6. But what sets the tone is the largest online retailer Amazon: For certain product categories it’s a one dollar fee. Bet on that expanding in categories and increasing in rate. Other ways are that about 80% of retailers will now have YOU pay the shipping fee to return items and others are experimenting with sending you an offer of a partial refund where you keep the product.

For months now I’ve wanted a New Orleans Saints sweatshirt. Yes, any NFL merchandise is massively overpriced, but I found a sort-of deal for US$60. Then checked the fine print: $20 shipping (never!) and it would be $25 to return it since sweatshirts have a wide variety of medium size definitions and fits. That makes it around $140 for the attempt to buy one that may not fit. Guess it’s never going to happen…

Update: Add Bed Bath and Beyond to the companies aggressively charging for full return charges in many cases. The company went bankrupt, closed all stores and was purchased by Overstock. Their website looks the same, but items are now online only and shipped out of the U.S. My first (and last) purchase of a $122 dresser that wasn’t correctly sized/described on their website took six days to even receive a “return authorization.” Six days of getting ghosted? Then they provided a UPS return label and refunded a partial $81 with no explanation. Seven days and five emails were ignored before I found someone at head office. Oh, that’s for shipping. Another 15 minutes to explain it was THEIR incorrect specs which caused the return before they agreed to refund the $41 UPS charge. Oh, and if I had returned it via UPS, the charge would have been $23. So does Overstock pay almost double what a one-off customer with no corporate account pays or has the return shipping become a major profit centre to them? You decide…

Amazon Will Find You

Amazon has nowhere near the lowest prices on even half of their products. Study after study and a simple price comparison will show that pretty quickly. But they’ve “trained” an entire generation of younger people to have their Prime membership and just click to buy. Good for Amazon – not so good for your spending.

But you have to give it to them that they are, by far, the most efficient company for deliveries. I’m in a new subdivision that’s still expanding and building. Two blocks up the street they just built 4 new 6-plex rentals. They finished one of the buildings September 30th. The investor owner took possession on October 1st and the first renters moved in on the 2nd. Yes, the day after!

That’s not the wow. One week later, Amazon “found” the new renters for a delivery! A new street, a brand new building, no address on the building at all, but Amazon found it for a delivery! THAT is pretty impressive…

FTC Sues Amazon Over Prime

After a two year investigation, the U.S. Federal Trade Commission is suing Amazon for deceptive sales practices of their Prime program and the hurdles to cancel.

While Amazon denies the allegations, the FTC claims Amazon has all kinds of little tricks and hidden consent to get people to sign up for Prime. They also make it difficult to complete a purchase without Prime, and hide the consent in purchases without disclosing the sign up is actually for a monthly recurring subscription.

After that, the hurdles continue when wanting to unsubscribe. Internal memos, discovered by the FTC, show the company calls it “Iliad” after Homer’s poem about the Trojan War. The process is all about discouraging people from cancelling without a lot of hurdles, hassles and hard to find places on their site.

This follows on the heals of an FTC settlement with Amazon over privacy “lapses” with Alexa and Ring. The fine was $30 million with Amazon “disagreeing” with the claims, but settling to resolve the matter. That amount of the fine is literally the equivalent of a one dollar speeding ticket in the revenues of the company. I disagree in that this matter should never have been settled but pursued. I have no idea why anyone would pay to purchase an Alexa or Ring doorbell that have a long long track record of spying on the purchaser. Sure, we keep telling pollsters that our privacy matters – then to a lot of things to insure we lose it – VOLUNTARILY! No thanks.

Amazon Vs Walmart: Your Wallet Will Thank You

One thing is certain: Most of us shop at Walmart or Amazon at least once a month or (a lot) more. One is pretty convenient to get to and one is just a few clicks away on your phone. Which one you drive to or click on is becoming more important to your wallet. Because, if you don’t comparison shop, it’s going to empty your wallet rather quickly.

From its inception, the goal of Amazon was to dominate the market with low prices. But that ended, or rather it transitioned, to convenience quite some time ago. With a reported 100 million plus people having Amazon Prime, there is an entire generation that values the convenience of two clicks to buy and guaranteed next day delivery. Amazon is banking on the fact that those prime customers don’t shop around much – and they’re right.

Convenience trumps price – just like the closest ATM with a four dollar “service” charge trumps free withdrawals at our own bank three blocks down the street. As we’ve talked about more than three years ago, Amazon isn’t the least expensive on identical products almost half the time (according to studies originally reported by US consumer guru Clark Howard.

Walmart also has some weird pricing on their website. Most of it appears to be from third-party vendors (which is also the vast majority of Amazon’s inventory. Here are some of my shopping attempts and price comparisons from the last two weeks:

Yesterday I bought the pretty plain Remington R3 razor at my local Walmart. I thought $40 was a little high, but bought it anyway…until I got home and checked Amazon! $118 total vs. $40 is insane!

The legal rip-offs for those not bargain shopping works the other way around, too. This is a simple 10 pack of plastic cover plates for light switches: $15 from Amazon vs. $64 from Walmart for a 12-pack!

A gray bus pan that restaurants use to clear tables: I needed two of them since they’re great for the garage. But I almost had a heart attack seeing the Walmart price of $200…for something I bought at Costo Business Centre for $6.

There were a few more of my purchases – or purchase attempts – from the last few weeks where either Amazon or Walmart weren’t even close. While these may be obvious, it’s the 20 smaller things you buy where the prices are “only” out 10 to 20 percent that don’t make it onto our “better double check that price” radar. And that’s what both of these giants, and their third-party vendors count on. At a time when it seems like everything is already up in price by at least 10-20 percent, take the two minutes to compare prices. Your wallet will thank you!

Your Wallet Can’t Afford Christmas In December This Year!

Yes, you can still celebrate Christmas on the right day, but you need to know that your wallet can’t!

Traditionally, the big Christmas season sales have been around the week of US Thanksgiving. But that’s going to be much different this year. It’s something you need to adjust to if you’re not in the one-third of the population who leaves it until the last minute. That’s for three main reasons:

Shipping charges: With the huge increase in online shopping, the couriers are super busy already. Fedex doesn’t even have delivery guarantees anymore. Maybe your package will be on time, but most likely, it’ll be days late. What does that mean? Huge surcharges from all the couriers for this Christmas season. It’s an issue of supply and demand. So you need to be very careful when shopping online and check the shipping costs before clicking to buy. It may still be free and the retailer is absorbing it. But you may also see that many retailers are passing some or all of these costs on to you! Buyer beware and read before clicking! It’s also the reason retailers will have sales this October to pull forward a lot of their Christmas sales before the courier surcharges kick in.

Amazon Prime Day: Amazon’s massive Prime day has always been in June. This year it’s going to be in October – and that’s likely going to be a lot of early Christmas shopping on that day. That means other retailers need to adjust, because it’s just that big a deal.

Retailers need the income: Since March, retailers have been badly hurt in their sales – assuming they were even open. If there’s any reason to move up Christmas sales to generate some badly needed cashflow, they’ll be on board. Prime day and avoiding the Christmas season courier surcharges are just three of the reasons.

If your routine is to shop the last week before Christmas, your wallet is going to feel the pain this year!

Millennials Helping Change the Retail World

Millennials are helping all of us save a bunch of money in vast numbers of industries. They’re getting to being the largest group in the population, so retailers have no choice but to adapt.

One of them is with car repairs. Typically you take in your vehicle and deal with a service advisor whose job is to coordinate the work and to upsell you! Yes, they call it a treasure hunt – where they look for other work that could be done, or might need to be done sometime… The modern way has started at a service shop in San Francisco called Luscious Garage: No service advisor – you deal with the mechanic directly. That’s the person fixing it, and that’s who you communicate with, so it immediately takes out communication problems, the adversarial relationship, and the stress and pressure of being upsold.

The mechanic will text you with what they’re working on. So you might get a text update that they did the breaks, and here’s the picture of the newly installed pads. And there’s a hose leaking – here’s the picture of the leak. Want us to replace this hose for $30, and half hour labour cost? Customer love it – and that’s the wave of the future!

Online mattress purchases are only around 15% but that’s enough to drastically shake up the industry right now. The same is true for Gillette, which is in massive upheaval with an online retailer called Dollar Shave Club. It just take someone to find a better, cheaper, and more convenient way to shop. And it’s a great thing for an industry with massive markups. The industry has always been thought of as being right up there with buying a used car! Any upheaval will be your financial gain. The industry upheaval is to the point where Mattress Firm, the largest seller in the U.S., has filed for bankruptcy.

The changes are for two reasons: Firstly, Amazon has now gone into the mattress business. Look at the companies that also sell them and their massive decline in stock prices when that was announced late last year. The other one is a company called Casper. They’re way cheaper and compress a mattress so it can be shipped via courier. And, from what I’ve heard, they’re supposed to be great. You can also go to Costco and buy one in a box. And they’re all compressed to be able to fit into the back of a Honda Civic – that seems to be the industry rule for shipping size. Plus, now you have upwards of three months to return it – try that with a traditional mattress purchase!

Virgin Hotels caters to millennials. One of the biggest pet peeves of customers on every survey is the quadruple priced stuff in the minibar. That $2 package of nuts for $9! Their hotels price it at exactly the same as stores in their area – period. Managers send a staff member to the nearest Macs and Walmart to get the price that they’ll use in the minibars!

George Boelcke – Money Tools & Rules book – yourmoneybook.com

Online Reviews, Story Ads & Amazon’s Problem

Someone last week emailed me an article by a pretty good financial tools website called Motley Fool. It was an article featuring a new credit card that they described as having “lucrative rewards and monstrous perks…sign up today while the card is still available…”

Sorry, but nothing in there is monstrous or lucrative and even more bad news: If you scroll down to the very last tiny font line it states that “this is a promotional message.” In other words, the company is being paid to send out this ad in the form of an article! No need to compare cards as this pretend article is guised in the form of a review.

Most people that buy online do look at a few reviews before they make a purchase. And, since Amazon is the giant in the online purchasing world, that’s the place people need to be careful. Since vast numbers of shoppers do the purchases on their phone, they tend to only look at the first two or three reviews and then buy, without scrolling down to pages and pages of other feedback.

The rumours have been around for some time that Amazon’s reviews are manipulated and can’t be trusted. Now, as first reported by Clark Howard, Amazon has admitted to it. Employees have taken bribes to take down negative reviews.

Why does it happen? You have to remember that most products are sold by 3rd parties on Amazon. Those sellers list on Amazon and mostly have the items shipped through Amazon for big fees and commissions. It’s their main source of sales and if the top two reviews are negative, people will move on.

For other sites, it might not be manipulations, but you have to remember that many – if not most – are sponsored sites. The sites get paid by companies to be prominently featured. If they’re not – they’ll stop paying to be on the site! In other words, you’re not getting a full or accurate rating on them. That’s something that the Wall Street Journal has documented for years.

Two of those are Canadian mortgage rates comparison sites:ratesupermarket.ca and rate and ratespy.com. Lenders pay to be on there, so you will see what those who are paying want you to see!

The best evidence of this is a recent ad by Angie’s list. It’s a site to find a variety of home contractors. “Angie’s list has selected millions of customer reviews…” Did you catch that? The words are: has selected – because they’re known to cut negative reviews, or those contractors won’t pay to be on their site! An investigative report found that they do that some years ago already.

Be careful when you’re looking at reviews or paid ads that seem like articles, and always scroll down to more than the first two or three reviews before you make a purchasing decision.

George Boelcke – Money Tools & Rules book – yourmoneybook.com

Sears, Amazon and Why We Can’t Do Our Own Investing

Ever wonder why retailers aren’t doing so well? Here’s a huge reason for it: Traditional retailers such as Sears, The Bay, Macy’s and the likes take 9 to 13 months to get a new clothing line from concept to production and into their stores to sell. Zella is a company with an extensive line of clothing. They can get an idea to production and into stores inside of two weeks! Two weeks versus a year. Wonder no longer why traditional retailers are fading quickly.

On the upside, Thursday Amazon announced they’d be selling Kenworth appliances online. Yes, Sears does have stuff people want – but now it’ll be online and in the U.S. only for the time being.

That announcement also shows why you and I really can’t do our own investing very well: When Amazon announced they’d be selling Kenworth, the stocks of other appliance retailers and manufacturers dropped by $12.5 billion collectively. From Best Buy to Whirlpool, Lowe’s, Home Depot, and the likes their stocks took a big hit. Now you and I may have figured out in a few days that, instead of Kenworth being gone, they’re now going to be a major player with Amazon behind them, but the Bay and Wall Street computers made the sell moves within a minute…

Speaking of investments, I’m going to make a bold prediction if you remember that I’m not an economist: The Bank of Canada can’t and won’t raise rates again until the U.S. does. The rate increase two weeks ago was based on thinking the U.S. would do one, too and they didn’t. The dollar is now way too high for our exporters and getting the dollar down is the main objective of the Bank of Canada. So they can’t do another increase, even if they wanted to, until the U.S. starts to raise them again.

Bad for savers, good for borrowers to get another reprieve…

Three Money Insights for Wednesday

Another huge wave of phishing scams are showing up in your e-mails. These two are predominantly from E-bay and Amazon. The Amazon one works for the crooks because so many people have dealt with the company. The e-mail will state that your order has been cancelled and to click on the link. Tons of people do and are asked to enter their password. Once that’s entered, the crooks can go into the real Amazon within minutes and place orders for hundreds or thousands of dollars and have them shipped wherever they want. Amazon allows third-party shipping and retains your credit card information on your profile.

Don’t click on an e mail – almost never. Go to the real Amazon or E-bay on your browser. And you can also hover your mouse over the hyperlink the crooks want you to click where the bottom left side of your screen should show you the actual web site it is re-directing you to.

If you want to save some money in the kitchen, stick to a budget, and/or reduce waste, there are two new web sites that are kind of cool. Both are set up for you to enter the ingredients you have in the house and will ‘translate’ them into figuring out what you can make for dinner with what you have! The two sites are www.saymmm.com and www.supercook.com

What would you pay to have lunch with one of the richest and most successful investment people in the world, Warren Buffet? Lunch with Buffet was auction off last Friday at $3.5 million. It’s an annual auction in support of the Glide Foundation helping the homeless in San Francisco. I’m sure it’d be great investment insights but at a big price…