South Korean retailers ramp up satisfaction guarantees
Despite such initiatives adding to their costs, retailers are confident with the low refund rates.
South Korea’s major retailers are actively introducing policies guaranteeing satisfaction and promising to offer full refunds to dissatisfied customers, believing that policy could contribute to attracting more customers, Korea Bizwire reported.
In particular, hypermarket chain operator Homeplus has launched the "Best Taste Campaign" for all fresh food, a beefed-up version of the "Fresh Aftersales Service System" designed to ensure full refunds for customers who are not satisfied with the quality of fresh foods.
At the same time, e-commerce platform WeMakePrice has been running a 100% refund program since October, that enables customers to get a full refund if they are not satisfied with the quality of premium agro-fishery products.
Korea Bizwire noted that a 100% refund policy could be burdensome since it generates extra costs, including the logistics cost for handling refunded items. There have also been cases where dishonest customers gained illegitimate profits by abusing the refund policy.
Still, retailers are sticking to such policies since the ratio of customers who actually request refunds among total consumers is quite low. After Homeplus introduced its refund policy in 2018, the refund rate has remained low at less than 0.01%.