There’s so many threads in Reddit discussing the phenomenon of low priced items leading to endless headache for the seller. As an example; a $7 GameBoy leads to not only a chargeback but also bad feedback and even threats while a $1,500 commercial printer leads to a 5 star feedback with 0 issues. Here’s my thoughts on this issue, based on my 16+ years of online selling experience:

I often chat with a fellow wholesaler. He is in NJ and we are in MI. Although we are about 11-hours-drive-time apart, we seem to have nearly identical experiences and one of them is the ongoing issue with the absolute worst-of-the-worst buyers being the people who buy piddly things, whereas the buyer who spend medium-to-large sums of money are a pleasure to do business with. But why? I have spent a lot of time pondering this and this is what I have concluded:

Cheap items are often impulse buys. “Cheap Items” includes everything priced at $19.99 and under (why do you think infomercials use the magic “Only $19.99!” number? = IMPULSE BUY!). This phenomenon has been studied in detail and if you feel like reading some fascinating studies check out Wikipedia’s Common Law of Business Balance. Here’s a fantastic quote from this page:

“It's unwise to pay too much, but it's worse to pay too little. When you pay too much, you lose a little money – that is all. When you pay too little, you sometimes lose everything, because the thing you bought was incapable of doing the thing it was bought to do. The common law of business balance prohibits paying a little and getting a lot.  The sarcastic thought in my head right now:  ”So you’re saying the $7 GameBoy won’t change my life? The $19.99 Flex Tape won’t permanently prevent me from having to replace the hole in my roof?"

This reminds me of all the awful reviews you see on 2-star budget hotel rooms. Like, bro, it was a $45 room, what did you expect? If you wanted a nice room you could have drove the extra 3 miles and paid $179 at Embassy Suites. Anyways…

When you choose your inventory and your price-point you also kind of choose your customer. Bill Gates isn't going to shop at Walmart, you know? And if you read our blog post about Walmart called Famous Store Liquidations We Hate you already know that Walmart shoppers can be exceptionally rough on merchandise whereas Saks shoppers are much more gentle. With that being said, it should be EXPECTED that if you specialize in budget deals and impulse-buy prices ($19.99 and under, out the door) you must also expect to attract a higher volume of “Buyers Remorse” than someone who sells $100 dresses.

SOLUTION:

Consider diversifying your product offering instead of only aiming for the impulse buy price. Get some merchandise that you can price at $29.99 or higher. 

Additionally, if you feel like you get insane buyers in waves, check out our post  Are Online Buyers Really More Crazy During a Full Moon?