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The (shady) art of store returns

Nordstrom is famously forgiving when shoppers change their minds about purchases. Customers love it — especially those whose motives may be questionable. The retailer has been known to take back well-worn clothing, shoes bought years earlier and jars of half-used moisturizer.

When Elana Pruitt was a Nordstrom sales employee years ago, she recalled, shoppers would make purchases with gift cards and then quickly return the items for cash. Technically it's allowed, said Pruitt, 33, now a social media coordinator and fashion blogger in Los Angeles. But she considers it "a bit tacky."

These days, shoppers are playing faster and looser. Serial returners have been conditioned by a culture of retail discounting and tight economic times. There's a mushrooming undergrowth of not-quite scams:

Spending a minimum of $50 to get a freebie and then returning everything but the gift.

Scouring aggregator websites for online coupon codes intended only for a retailer's email subscribers.

When buying discounted items that are final sale, asking for a gift receipt just in case — that way, the product can be exchanged later for store credit.

Shopping with subterfuge is getting easier as more consumers go online. Shoppers can namelessly swap deal-hunting tips on shopper forums and plug in multiple dates to repeatedly tap birthday promotions, among other ploys.

"Consumers are savvier and smarter than they've ever been before," said Matthew Ong, senior retail analyst at online personal finance company NerdWallet Inc. "There's so much more information available — they're talking to hundreds, thousands of other people."

Retailers are playing directly into some of the schemes. Many offer deals to first-time shoppers or customers who sign up for email lists, hoping to establish a database of information to help with targeted advertising. But anyone with multiple throwaway email accounts can take advantage of such promotions more than once.

Stores also are flinging deals at shoppers to encourage more digital purchasing. Buy one, get one free! Spend $25, get free shipping! Freeloaders will exceed the minimum spending threshold online, get hold of the giveaways and then mail back the rest of the haul, never showing their faces.

"The Internet provides anonymity," Ong said. "You can hide behind your purchases in a way you can't at the checkout counter at the store."

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Retailers have been hesitant to fight back. Cracking down on customers would suggest mistrust, a dangerous implication for the cutthroat industry. Companies don't mind dealing with a few retail ruffians in order to appear accommodating to the majority of shoppers. "We deal fairly with our customers and believe they are fair with us," Nordstrom spokesman John Bailey said. "It's about creating a relationship with a customer for the long term."

Many chains keep their return policies loose, and some are even relaxing them. Best Buy scrapped its restocking fee on most products in 2010. Macy's used to have a 180-day limit on returns; now it's unlimited with a receipt. And even without proof of purchase, Macy's will give store credit for the item's lowest selling price within the last six months.

Others accept behavior such as "wardrobing" — in which customers buy an item, use it and then return it — as a hazard of doing business. Online, as many as one-third of items purchased are returned, according to retail consultancy Kurt Salmon. "It's an overall benefit for retailers — they'd rather allow customers to treat their homes as a dressing room if it means people will buy more," Kurt Salmon analyst Michelle Bogan said.

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Savvy shoppers say that so long as there are generous policies or loopholes, they'll continue to look for ways to take advantage of them.

Paul Weiskel, 24, a political science student at the University of Massachusetts Boston, bought a pair of hiking boots from L.L. Bean about six years ago. He wore them regularly until last summer, when "they basically just disintegrated on my feet." Rather than toss them in the trash, he said, he took the boots back to the store without a receipt and got a $100 gift certificate.

Another trick: When doesn't deliver two-day-shipping purchases on time, he calls the online giant for a $15 credit.

"I think it's perfectly, perfectly fine," Weiskel said. "Most corporations, they have no problems taking advantage of consumers or workers for profit, so whenever a consumer can get a little more bang for their buck, I'm 100 percent for that."

Not so fast, Ms. Sneaky

Some retailers are finding ways to block sly shoppers. Among them:

Online coupon aggregator RetailMeNot said it monitors coupon redemption from individual users and is in constant contact with retailers such as Macy's and Best Buy.

Retailers including Home Depot are turning to services that track returns made without a receipt, then forbidding flagged customers from making receipt-free returns for a probationary period.

More companies are "slicing and dicing" their return policies. Instead of a single deadline, stores such as Sears, Wal-Mart and Target now have different return cutoff dates for various product categories — 90 days for clothing returns but only 30 for appliances, for example.

Among online retailers, fees for restocking non-defective returns are popular. Traditional stores do it, too. Home Depot employs a restocking fee for some big-ticket items like generators — customers have been known to buy them before storms and then try to return them after the bad weather passes.

The (shady) art of store returns 03/03/14 [Last modified: Tuesday, March 4, 2014 7:51am]
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