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A money-back guarantee, often referred to as a satisfaction guarantee, is simply a straightforward promise that a refund would be given to customers who are dissatisfied with a product or service.

Many of the marketing techniques still in use today were invented by businessman Josiah Wedgwood in the 18th century, including the satisfaction-or-money-back guarantee on his whole line of ceramic items. He sent his goods to wealthy customers all throughout Europe without their permission by taking advantage of his guarantee promise. Early American mail order sales pioneers like Richard Sears and Powel Crosley Jr. used the money-back promise as a key tactic to secure customers’ trust.

Over the past few years, the usage of money-back promises has increased considerably and has become industry standard in direct marketing across all media. It is sometimes used by untrustworthy companies as a ploy to lull customers into believing they are safe. Many warranties made by sellers frequently go above what is permitted under their bank’s merchant agreements. For instance, the vendor is expressly prohibited from providing a money-back guarantee after 90 days from the date of purchase by Visa and MasterCard.

False guarantee problems have grown so widespread in the US that the Federal Trade Commission has included a special reference to them in the Code of Federal Regulations Handbook ( 239.1).

Customers can use a variety of actions, such as contacting the authorities, to put pressure on a business to uphold its promised guarantee.

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