November 29, 2010

Researching a seller online

New York times has a long expose on a particularly blatant case of online fraud, involving an unscrupulous seller who subscribes firmly to the adage that no publicity is bad publicity. He was able to use customer's blind reliance on Google to defraud them while continuing to raise sales. The case is clearly extreme, but raises an important question - how does one protect oneself from fraudulent online sellers. Instead of relying on everyone's favorite search engine to come up with a solution, I believe the answer is in thoroughly researching a seller online before committing to a sale.

Researching sellers online is a bit of an art and science. This post hopefully presents a bit of both. To begin, make sure you distance yourself from whatever deal that got you to the seller in the first place. The only question you have to answer with a simple yes/no is: "Should I buy from this seller". Nothing else.

The obvious first, prefer the big sellers - Amazon, etc. Yes you are dealing with the big bad businesses, but the odds are in your favor that you will get what you bargained for. At the same time, understand that Amazon, and online marketplaces like eBay, act as storefronts for other sellers. Be aware of who you are really buying from. If it is not the big chain, you still have to assess the seller.

The second obvious point, prefer a seller using a payment intermediary - PayPal, Google Checkout etc. This does not mean you don't research the seller, you just can push it knowing there is a layer of protection there. And if you have to use a credit card, see if your bank offers disposable virtual cards.

Google the name of the seller - by itself without the product you are looking to buy. Go at least two pages deep, remembering that a majority of the first page may just be links from the seller's site. Even if the seller is on eBay, you can still Google them.

The overall rating is the first indication. No one gets a 100% or 5 stars, but closer the better. If you are looking at a 1 star or 10% positive feedback, close the window and walk away. Assuming the seller is not an obvious psychopath, start reading through the negative comments. The idea is to try and look for trends, and get to the truth behind the comments. Here are some comments you will possibly see:

  • "The product I bought from this seller sucks" - you will see a few of these, and you can safely ignore them. These are product reviews, not seller reviews.
  • "Product is different from what was advertised" - this is a bit of a red flag. It could just be a miss on the part of the buyer, or deliberate misleading by the seller. Look for multiple comments saying the same thing before deciding to can the seller.
  • "The product is fake" - now this is a big red flag. Rarely is this going to be a misunderstanding; better stay away.
  • "Seller charged incorrect amount" - this is definitely a red flag. True there are mistakes, but this is one of the most important things a seller does. Not getting it right is at best sloppy, at worst fraud.
  • "Something went wrong, and the seller charged for replacement shipping" - if that was in the small print to begin with, there is nothing odious about it. Bad? Yes. But fraudulent? Probably not.
  • "Their customer service is really bad" - This is a yellow, does not always mean something is wrong. The customer, unfortunately, is not always right. And everyone has their buttons. Consider the specifics of the comments carefully and look for repeats.
  • "The seller is aggressive or otherwise abusive" - drop the seller. No deal is worth it.
  • "The goods got damaged during shipping" - not much a seller can do about shipping, but just watch out for a trend.
  • "The shipping was delayed" - if the seller is missing a 3-day shipping for a 5-day delivery as a trend, they are probably just cutting corners and you probably don't want to pay extra for quick shipping. If delays are a constant features, then there is something not quite right. Consider walking away.

Looking back at the article all three red flags above happened in this case. I am sure the lady meant well, but a bit of 'Google before your click' could have saved her a lot of trouble. These are just guidelines, but reading through some details of what the customers are saying about a seller, could swing the odds of a successful purchase squarely in your favor.

Update: Google seems to have figured out a technical solution beyond the obvious and has already implemented it.

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