Online retailers failing to deliver the goods

15 Jul 2005

The non-delivery of goods ordered online is the biggest obstacle facing the development of e-commerce across Europe. This is according to the European Consumer Centre (ECC) Network, which has launched its annual report on online shopping complaints.

The study, which analysed all the online shopping cases received by the network during 2004, finds that non-delivery of goods continues to be the No 1 gripe for online shoppers.

The network received 257 complaints during 2004 from consumers who had not received products that they had ordered. The majority of these consumers had also paid for the goods in advance.

“The non-delivery of paid goods is a threat to consumer confidence and, as a consequence, to the development of the European cross-border e-commerce market,” the report states.

This problem was also highlighted by a previous ECC Network report, Realities of the European online marketplace, which found a staggering one third of goods ordered online was not delivered, while 23pc of the undelivered goods had been paid for in advance.

The web traders’ reasons for not delivering the goods vary. While fraud is occasionally responsible, inadequate order processing, poor administration or the fact that the company simply does not have the advertised goods in stock, account for the majority of complaints.

“To not receive what one has ordered and paid for is the e-shopper’s worst nightmare and might very well cause the consumer not to shop online again,” states the report.

The research also finds that online fraud is on the increase. This can take various forms — fake lottery wins, cheque overpayment scams, phishing, internet auction frauds, false escrow companies and fake web traders.

The survey notes that fraudsters’ methods are becoming more sophisticated, making it “very difficult to distinguish a legitimate e-commerce company from a scam web trader”.

Internet auction sites also feature on online shoppers’ complaints lists. Consumers are particularly vulnerable on these sites as often the transactions that take place are consumer-to-consumer and, therefore, are not covered by consumer legislation as both buyer and seller are private individuals.

In order to avoid problems the ECC advises online shoppers to: shop with companies you know or that have been recommended to you; find out what the online company’s refund and return policies are before making a purchase; avoid using money transfer as a payment method as it is difficult to trace where the money goes; never email personal or financial information; if you get an email or pop-up message that asks for personal or financial information, do not reply; be sceptical when dealing with an unknown party; and check in any online ‘Whois’ registry to see who the domain name is registered to.

“It is a fact that online shopping has increased, but this virtual marketplace still poses unique problems for the consumer,” says Tina Leonard, manager, ECC Dublin. “It is therefore important for consumers to arm themselves with knowledge in order to shop safely in a marketplace vulnerable to fraudsters.”

The ECC Network, whose mission is to create consumer confidence in the internal market, has centres in 23 European countries. The network is co-financed by the Health and Consumer Protection Directorate-General of the European Commission and each of the participating member states.

By Brian Skelly