Who's Watching the E-Retailers?

f you had a complaint against a retailer and hadn't gotten satisfaction, whom would you turn to? If you're like most consumers, you'd probably call the Better Business Bureau (BBB).

But these days, chances are you're shopping online, and estimates say you have plenty of company. According to the U.S. Commerce Department, online retail sales totaled an unadjusted $5.3 billion in the fourth quarter of 1999. And that doesn't even include an estimated $3.5 billion spent on services such as travel or event tickets. This means you could be stuck with a problem but no one to talk to.

Shopping list
for consumers

When creating
a password,
avoid using
established numbers.

Better Business Bureau
The Council of Better Business Bureaus (CBBB), the umbrella group for BBBs throughout the U.S., established an online version of the BBB to service transactions taking place over the Internet (BBBOnline).

According to Holly Cherico, public information officer of the BBBOnLine, "When the electronic marketplace began to emerge in the mid-'90s, the business community, consumer groups, and government regulators saw a need for an 'online' BBB to help make this new marketplace successful. Scam artists are always the first to take advantage of a new technology [such as telemarketing], and we were asked by regulators and responsible businesses to help establish consumer trust and confidence in the e-marketplace by playing a role in the online environment."

Overall, Cherico says, online shopping experiences are positive, but as more and more people log on, the need for a watchdog increases. She says consumers can feel the same confidence when they see a BBB logo on a retailer's home page as they can when they see a sticker in a traditional retailer's window. It indicates that that e-retailer has agreed to adhere to the same BBB standards for customer satisfaction.

BizRate
The BBB is not the only company to realize consumers' need for positive e-retail experiences. BizRate.com is a company that rates e-retailers, using peer reviews to form report cards for BizRate merchandisers (such as FAO Schwarz, Amazon.com) and those that are not (such as the Gap, JCPenney).

Featured in Consumer Reports, BizRate.com uses online surveys to rate customer satisfaction for thousands of online stores. Its logo appears on the home page of more than 3,600 e-retailers and it continuously solicits customer feedback.

Say, for example, you're looking for a toy but want to use a reputable retailer. Like those companies that have signed up with the BBB, e-retailers displaying the BizRate logo have agreed to comply with certain customer satisfaction standards.

You could visit the BizRate site and search by item or store and pull up a report card on an e-retailer you're interested in patronizing. If you decide to shop at SmarterKids.com, you'd click and get a full five-star review, plus a synopsis including customer comments. Here is an example:

Performance Review—SmarterKids.com, Score: 98
"A good value for the money," SmarterKids.com is a great online educational store for parents. Parents on the go can customize this efficient Web site to search for products that address the specific needs of their children. With great ratings across the board, expect an impressive service online and outstanding order fulfillment. "The Web site is well-laid out and provides easy navigation and secure transactions." Overall, SmarterKids.com is an exceptional Web site for parents to find products that may give their kids an edge in learning. "Great deals, excellent variety! So much easier than going to the stores."

BizRate accepts no advertising and earns its revenue through market research.

"We query millions of customers at the point of sale every day," says Tran Vu, BizRate spokesperson. "We have a panel of 100,000 shoppers who review sites and rate them on items including ease of ordering, product selection, price, on-time delivery, [and] customer support," among others. BizRate sends e-mail queries two to five days after expected delivery dates to confirm that items arrive on time.

According to BizRate, the system "aggregates information and empowers online buyers to make more educated purchasing decisions based on feedback from fellow consumers." It then provides online stores with specific feedback from their online buyers, which is how it benefits online companies that display the BizRate seal.

Consumer Reports Online also offers an online shopping guide, providing exclusive shopping site reviews for subscribers to the Web site, which costs $3.95 per month. Like BizRate, Consumer Reports does not accept advertising from any company, whether or not they are reviewed online.

     Ask the company
     for its physical
     location so you can
     check on its
     reliability.

Look for the prefix
"https://" in the
URL (uniform resource
locator) box.

Privacy watchdogs
Privacy is another issue with online shoppers, and just as there are retail watchdogs, there also are e-companies that ensure that your transactions are safe. Look for logos like the BBBOnLine Privacy Seal, implemented in 1999, or the TrustE logo, implemented in 1996, to ensure that e-retailers are complying with privacy practices that keep consumers' best interests in mind.

According to the CBBB, Web sites displaying the BBBOnLine Privacy seal have established privacy policies to protect consumers. As part of the BBBOnLine privacy policy, businesses must

include notification to consumers about how information is collected, used, and shared;
provide adequate data security;
provide the option to deny third-party information transfers (where a company gives or sells things such as e-mail addresses, to other companies);
provide reasonable access to information; and
use encryption for the receipt and transfer of sensitive information.

TrustE offers similar protection. Like BBB e-retailers, those who display the TrustE logo, or "trustmark," agree to comply with the company's consumer resolution process and follow guidelines for consumer protection. The company's mission, "to build users' trust and confidence on the Internet and, in doing so, accelerate growth of the Internet industry," is a goal most e-commerce companies like to support, which is why self-regulation of privacy policies has been so well implemented.

Some search engines, such as Yahoo! and Netscape offer a selection of stores from which to shop, and these search engines take their reputations seriously.

Go to the shopping sections of any major search engine and you will find extensive privacy policies that have been implemented to ensure your protection.

So if e-retailers are trying so hard, why do we need protection agencies?

The BBB's Cherico says the most common complaints filed against online merchants are about misleading advertising, nondelivery of goods or services (remember last year's Christmas disappointments?), guarantees that are not honored, unsatisfactory service, and credit or billing problems. She offers a list of red flags consumers can look for when shopping. Also check out the BBB site for a more detailed list, and happy shopping! Enjoy the cyberspace mall.

Shopping list for consumers

Chances are good that you'll be one of those shoppers soon making an online purchase, if you haven't already. Here are some tips to help ensure that your experience is a safe and satisfying one:

Location, location. If you're interested in trying a new online merchant that you're not familiar with, ask the company for its physical location (address and phone number) so you can check on its reliability with outside organizations.

Customer satisfaction policy. Determine the company's refund and return policies before you place an order. If online companies can't offer concrete commitments about how they will handle potential problems, reconsider doing business with them.

Protect your passwords. Never give out your Internet password. When creating a password, avoid using established numbers, such as your house number, birth date, or your telephone or Social Security number.

Leave nothing to chance. Be sure you have a thorough understanding of everything involved before making an order. Be clear about the price and any shipping and handling charges. Know the terms of any product or service guarantees. Find out how long it will be before you receive your order. Federal law requires that goods and services be delivered within 30 days, unless the merchant specifically states a different delivery period.

Guard your personal information. Only provide your credit card information or Social Security number online in a secure environment. Look for the prefix "https://" in the URL (uniform resource locator) box that lists the Web site's address to be sure the site you are using is secure.

Keep a paper trail. Print out the "address" of the company site you are on. The URL ensures that you are dealing with the right company. It's also a good idea to print out a copy of your order and confirmation number for your records.

Know your consumer rights. The same laws that protect you when you shop by phone or mail apply when you shop in cyberspace. Under the law, a company must ship your order within the time stated in its ads. If you decide to pay by credit card or charge card, your transaction will be protected by the Fair Credit Billing Act. If you are not comfortable entering your credit or charge card account number online, call it in to the company's 800 number or fax it.