TLDR;
The video discusses the rising issue of return abuse in China's e-commerce sector, where customers exploit platform policies for personal gain, leading to significant losses for merchants. Retailers are implementing creative solutions to combat this trend, while platforms are beginning to address the problem by optimising return policies and using AI to detect fraudulent requests. The video explores the underlying causes of this phenomenon, attributing it to economic pressures, declining morality, and the impact of the Chinese Communist Party's policies.
- Retailers are using unusual tags and combination locks to deter returns.
- Return rates in China's online clothing market are exceptionally high, especially in live stream sales.
- Customers are exploiting loopholes in platform policies, such as "refund only" options, leading to fraud.
- Economic pressures, declining morality, and the CCP's influence are seen as contributing factors to the problem.
- E-commerce platforms are starting to address the issue by optimising return policies and using AI to detect fraud.
Intro [0:00]
The video introduces the unusual trend of people in China using large clothing tags and even mouse pads attached to their clothing. These quirky designs are a response by clothing retailers to combat the increasing rates of returns, with the aim of making it more difficult for customers to return products without legitimate reasons.
Creative Solutions to Deter Returns [0:20]
Clothing retailers are struggling with high return rates and are devising creative solutions. One men's clothing store in Changjo used mouse pads, ashtrays, and socks as tags, which led to a significant decrease in returns. A retailer in Beijing uses combination locks on zippers to discourage customers from wearing clothes and then returning them. These measures aim to reduce losses caused by customers exploiting return policies.
High Return Rates in China's E-commerce [1:31]
The return rate for men's online clothing in China is around 30 to 40%, with a further increase due to women buying clothes for men. Women's clothing sees even higher return rates, reaching 50 to 60% online and exceeding 80% in live stream sales. Many returns are not due to quality issues but because customers wear the items and then return them. Retailers face huge losses, with one female clothing retailer reporting significant financial setbacks due to returns with obvious signs of wear.
Exploitation of Platform Policies [3:01]
Customers are exploiting platform policies to cause losses for merchants. Examples include returning used items instead of new ones, sending unrelated items back, and even faking logistics information to get refunds without returning the goods. A fraud case involved a woman scamming merchants out of over 3,000 items by requesting refunds without returning them. Students collectively bought and returned clothes after a sports event, causing financial loss to the shop owner.
Moral Decline and Extreme Cases [6:09]
An extreme case involves a vlogger who openly admitted to wearing clothes and underwear directly, contracting genital warts, and then returning the items for a refund. This action sparked outrage and highlighted the breakdown of hygiene and trust standards. Merchants often suffer in silence due to the difficulty of gathering evidence of fraud, leading some to exit the market.
The "Consumer First" Principle and Its Consequences [7:29]
E-commerce platforms, in their pursuit of user acquisition, have pushed the "consumer first" principle to the extreme, leading to widespread abuse of return policies. Features like "refund only" and shipping insurance have made it easy for people to exploit the system. This has led to the rise of professional returners who profit from refund-related differences, with some courier stations even recruiting partners to manipulate returns for insurance money.
Platforms Fight Back [9:17]
Platforms are realising that the "refund only" policy is backfiring and harming the e-commerce ecosystem. They are optimising and even cancelling the unconditional "refund only" rule. Platforms like Tao and T-OL are establishing account integrity systems using AI to detect and block abnormal refund requests, product swapping, fake returns, and photo manipulation. They are also promising to compensate merchants who have fallen victim to such schemes.
Economic Pressures and Moral Collapse [10:14]
Experts believe that economic pressures are a key factor behind the rise of return abuse. Unstable income expectations, shrinking assets, and rising employment pressures contribute to a mindset of saving whenever possible and exploiting the system. Others argue that the real problem is the loss of morality among Chinese people, with a shift from believing in effort being rewarded to a "cheat or be cheated" mentality.
The Role of the Chinese Communist Party [12:47]
A scholar argues that the Chinese Communist Party (CCP) is the root cause of China's moral collapse. The CCP's suppression of religious beliefs and restriction of freedom of thought and speech have led to a society where people only believe in money and are willing to do anything to get it. The CCP's manipulation of facts and control of the media further exacerbate the problem.
Hope for Moral Improvement [14:11]
There is hope and potential for China to change its moral direction, but it cannot be expected to improve naturally through economic development alone. Establishing respect for human dignity, personality, and basic rights is crucial. Political reforms are needed to address the moral decline and foster a societal consensus on universal values.
