Designing a Better (Human-Centered) Online Course Refund Policy

So, there’s this customer service “practice” happening in the online course space, and . . . I’m not a fan. Let me explain, and then please, tell me how you feel in the comments.

Why I’m strongly against online course and digital product refund policies that make people do X amount of work or jump through fiery hoops to get a refund.

You.

I write this blog for you. I create tools for you. I stay up at night dreaming, scheming, and creating for you. Not just in the “I say this because this is how online marketers are supposed to talk” way, but in the “No, literally, I relate to where you are and who you are, and where I had to come from to create various businesses and products I love” kinda way.

Refund policies that make clients submit worksheets, and modules, and proof of this and that and the other rub me the wrong way.

If your entire audience consists of people who don’t care about money at all, then cool.

If you have people in your audience that care about spending their money on things they get value out of, or who are on a specific budget, or who may, despite your wishes and requests, spend their last dollar on your program, then hmm.

If your audience potentially includes people like the people I know . . . where an emergency may come up a few days after they purchased your truly great program, but they need money all of the sudden and you advertised a “100% money-back guarantee” . . . then let’s talk about the real reason you make it a chore to get that money back. It’s not like everyone is going to have an emergency.

Let me not get too deep into a rant just yet, and actually outline my reasons for saying that self-serving refund policies disturb me, plus tell you why I think they are so self-serving in the first place:

1. They are not what people expect, assume, or want.

I was at a vegan restaurant in Playa del Carmen, Mexico the other day and I ordered some pie. Let me be honest here. It was disgusting. I didn’t want to be rude to the chef so I took two bites instead of just one, but then I just couldn’t do it anymore.

Laura, a super kind lady who works there, noticed that I didn’t eat the pie when she brought me the check and asked if it was okay. I was honest that it wasn’t my favorite, but that I was, of course, going to pay for it. She said, “No. If you didn’t like it, I’m taking it off of your bill.”

This is the level of service that sticks out to clients. (I’ve been back to that restaurant 25 times since the pie because I have a new level of trust for them.) The average consumer who buys online courses and digital programs is used to being able to take any item back, whether food, drink, clothing, or otherwise, within a reasonable amount of time to get their money back. We don’t expect you to come to our homes, make sure we’re using the new boots we bought, but have a $50 refund waiting in your pocket if we aren’t using them, but we do expect to be able to bring the boots back if we don’t use them or if they hurt.

When you want something removed from your bill at a restaurant, they don’t make you eat the pie in front of them, or try at least 50% of it to make sure it really doesn’t work for you. The attendant at the clothing store doesn’t make you wear the blazer for 25 minutes in front of them and stare at yourself in the mirror the whole time to try to assess your deep wounds/reasons for not feeling you look good in said blazer.

We expect to be able to return something we don’t want anymore, or gasp, realized we really couldn’t afford (we’re human; we make mistakes and miscalculate) or fit into our lives, but we were carried away with the hype or sales tactics.

2. They serve the course/product creator solely. They do not serve you, the customer.

I’ve yet to meet the person, not saying they don’t exist, who loves the fact that they wanted to get a refund for a course, but were told they had to submit 5 screenshots of work, 22 pages of the workbook—completed, and a statement that they really gave it their best. Perhaps there is one story of someone who did the work and then realized, “Oh no. I love this course and the creator for making me do this.” I’ve just never met that person.

You are the one investing hard earned money and time into the program. I personally believe you should have the right to change your mind, run into an emergency and need the money back within a reasonable amount of time, or realize you made a rush decision or a decision off of faulty/incomplete information that the course’s affiliate, sales page, etc. gave you.

If you think of my ridiculous illustration above of trying to return a blazer and the store representative making you try it on and stare at yourself for 25 minutes, the store is now moving into the realm of life coaching, psychiatry, and spiritual healing.

I can hear the person saying, “Why don’t you feel like you deserve this blazer? Why are you not willing to put in the work to make this blazer everything it can be in your wardrobe?”

And you’re like, “Umm. I just didn’t realize it had purple polka dots on the back and that it is a little too loose in the front.”

3. They establish a mother-child relationship with you, the client. The one paying money. From one adult to another.

Here’s my favorite thing ever. Extreme sarcasm. I saw a headline a few months ago for an old interview session that one big name industry person did with another big name industry person. The headline was interesting, “How SoAndSo lowered return rates . . .”

I clicked. I read the text that went with the session so you could get a gist of what would be talked about. I almost threw my computer across the room in disgust. I showed my friend what I thought was the most outlandish, ridiculous stuff ever. He agreed that it was terrible business.

The person lowered their return rates by making it harder to return the course. That was not even the hidden message of the “resource,” it was the very highlighted and praised message of the interview session. Something about how it makes people be more responsible for actually doing the work. Nothing about how the course creator invested time in improving the experience of the product.

My thinking (as someone who has both people who’ve asked for refunds AND amazing super supporters who buy everything, happily): If 20 – 30% of the people who invest in a program want their money back (first off: I would die, then need to be brought back to life to fix the issues), it is less likely that it’s related to the client and their sense of personal responsibility, and more likely that they can’t understand the value of the program yet, or that they were confused during the buying process, or that the program doesn’t do what it said it would. All of those things are on us as the course creators.

So, turning a refund into an “opportunity” to teach a grown adult a lesson about personal responsibility is a little too “Am I 7 years old?” for me.

4. They’re a bad business practice.

A couple of months ago, I felt like I was frozen in time/twilight reading a horror story when someone linked to the Facebook post of a course/program creator they used to love (someone I’d never heard of, but has a large following online) when this course creator went into a long story about refusing to refund a woman who said she needed the money back for a health procedure.

It was so painful to read. Even if this woman completely made up a medical condition and wanted the money back to buy 1,000 yo-yos for herself and 53 chew toys for her dog.

The course creator framed her adamant, “No.” as the best thing for this client, as standing up for herself, and as believing in the strength of her program and not being bullied by people who don’t want to do the work.

I expected the comments on this post to be FIRE DRAGON level. And indeed, many people expressed dismay and extreme disappointment in the course creator (to which she replied individually something along the lines of “Look inside yourself to see why you have a problem with what I did.”), but what surprised me is that the post had a few, “You go girl!” comments. “Way to not back down.” “You showed her.”

I believe in my heart that most course creators, even those who have a “You have to send me a blood sample and gold doubloon to get a refund” policy would choose to give back the money to someone who says they’re in need, so I really use this just to show that making refunds hard typically isn’t good business.

Why?

Do you get to keep the money? Yes. But at what cost? You are creating an environment where people speak poorly of your brand.

I was teaching an in-person workshop on online courses (ahh, the irony) last year when a few attendees went on a rant/tangent when they discovered they had all purchased a certain course from a specific brand online . . . had all not liked the experience . . . but had all been unable to ask for a refund in time because of the work they had to submit (that they didn’t realize) or had decided to just forego the refund attempt because of how much work it was.

Did they have anything positive to say about this course or the brand behind it? No. Did they pass on a certain impression of this course and brand to those of us listening in amazement? Yes. Was that good for that brand? No.

Oh, and here are a few personal reasons not everyone will agree with:

5. The refund policies are usually enforced by people who don’t need your money.

Whether the program is $250 or $2500, the person usually doesn’t need your money to survive.

6. These policies don’t put much pressure on the course creator to create something amazing that is easy to understand. And then motivate people to begin.

It places the pressure on the client to begin, progress at the rate the course creator would like, then submit proof if the materials don’t work.

7. The refund policies seem lazy.

Whereas if you run a business where you’ve incurred significant extra costs to take on a new customer (renting a physical space for an event that can fit everyone, creating a gift bag, etc.), it can make total sense to not allow certain refunds, but for online course creators delivering a digital product, the marginal cost to bring on one additional student isn’t (to me) justification for keeping their registration amount if they want it back.

As the product provider, wait until 30 days after the person has purchased, and then on the 31st day count the income as real. If you’re not as attached to it and to making a specific amount, it won’t be a big deal to process the few refund requests you might get.

To be honest, I much, much prefer when people state that there is no refund (where legal), and I’m pretty sure I bought a digital kit with that knowledge before, over people using language like “100% satisfaction guarantee” or “try this risk free” or any number of phrases, when the fine print is that we really have a few days with your program to figure out if we like it, then we have to do the most to detach from it.

If you’re in the online business space, you might wisely be asking “Why in the heck would you write a blog post that is going to cause big industry names to not ever want to work with you, Regina?”

Great question.

1. If the industry person is someone who actually finds they agree with some of the points above, and decides they don’t really need their return policy the way it is, then we all win, because more information is available truly risk free.

If the industry person is someone who reads this and hates me, then I’ve successfully helped to disqualify us as awesome collaborators in the future. I would have views that they hate, and they would have views that I don’t believe serve the people I want to serve.

I’ve accidentally introduced you to (through this blog and past collaborations) brands that don’t stand for you the way I would want anyone I introduce you to to stand for you, and I don’t want to do it again.

2. I’m going to be very frank and “nontraditional Regina” here, I don’t need one specific relationship with one specific industry name in order to make money and live. I need you. And I need to continue to build a brand through which I can help you create a business that doesn’t rely on one specific industry person for you to make money and live either.

3. Lastly, if I don’t use the platform that I spent long hours and actual blood, sweat, and so many tears building to ACTUALLY serve you and to take a moment to say, “Hey, there’s another way. Anyone who will listen, check out what message you might be sending with your return policy.” then what am I doing?

Pause. Let me not be 100% rant-y and 0% helpful in your quest for the perfect return + refund policy. First, if you are the creator of courses and digital products, if you are an infopreneur like I am, then I would suggest thinking through your different policies and preferences for eBooks, email courses, online courses, templates, and events.

As an example, my refund policy on eBooks is 14 days. I figure that’s enough time for most people to get use out of, and make a decision on, a book that’s 100 pages or so.

My refund policy for courses is typically 30 days. There are exceptions when there are in-person components (and I’m literally holding one of 5 – 10 spots for you), but I try to give people enough time.

My policy on live events is that you can request a refund through the end of the day of the event. If you wait until the day after, it’s a bit odd since the event has already been delivered. But, if someone told me they watched my live event and didn’t get value out of it, I’d give them their money back and truly question what went wrong for them.

These weren’t always my refund policies. I had to live and learn through some silly phases of mine (like a 10-day time period—for what, Regina? . . . or a 14-day refund period but then the course doesn’t even start for 10 more days). This ridiculousness was a result of moving too fast through everything I had to do, or being shorthanded and leaving administrative details until the very end.

I recommend really taking some time to think through what you want, what your client wants, what you need, and if your fear of refunds is based more on your feelings of how hard-working your audience is going to be (eye roll emoji) or of how incomplete/confusing/etc. your product may appear to someone.

Do the things on the presentation side (what you tell people before they buy), the experience side (how you treat your students and how you guide them through the materials—I’m still testing the best ways to do this), and the backend of your product (its organization, ease of use, completeness, and more) to alleviate your stress and fears about refunds. Build a product so good that if someone asks for a refund, it has nothing to do with you.

P.S. Here’s a tool/product you can use to generate your return policy—among other policies and legal language.

Let me end by saying . . .

People who have jump-though-hoops return policies are not necessarily bad teachers, bad people, or people who don’t care about others. That is NOT the message I’m trying to send. Also, there are a lot of people doing returns in super ethical ways. Ways that inspire me and that I can learn from.

This is a call for anyone who will listen to not take a practice into your own business or life simply because that’s what some big names do. If you want to have a course with a specific refund policy, I’d encourage you to think about why you want that policy, who it serves, what you would want if you were the client, and how to explain your reasoning plus create an environment where someone is not both pressured into the sale and then told they have to do the most to get a refund for the item.

I am certainly against these policies because of the people I serve, but if you have reasons for supporting these policies, please do not be afraid to share them with us below. I think we can all benefit from hearing each other out and from critical thinking, so please don’t take my rant as a closed issue. Yes, I have this platform so that I can talk about things I believe affect you (the people I write for), but I love to hear and learn from you and others as well.

Seriously.