5 Things I Learned from the Regretsy – PayPal Issue


Customer Service Our PriorityYesterday I learned about Regretsy, a fail blog about handcrafts. It basically takes items (mostly from Etsy.com) that are considered art failures and features them on the site. Regretsy also maintains a fund for charitable donations. Last month, April Winchell, founder of the site, wanted to raise money for children who weren’t expecting gifts this holiday season. So she made the announcement of her fundraiser on the site and in a few hours they had enough money to make gifts for 200 families. Unfortunately, she ran into a bit of a problem with PayPal and all hell broke loose.

On Monday, PayPal froze her account because she had used a “Donate” button that she learned is only for nonprofit groups. In her blog post, “Cats 1, Kids 0” she discusses about her “very long and jaw-dropping conversation” with a customer service rep. She writes:

“PAYPAL: Only a nonprofit can use the Donate button.
ME: That’s false. It says right in the PDF of instructions for the Donate button that it can be used for “worthy causes.”
PAYPAL: I haven’t seen that PDF. And what you’re doing is not a worthy cause, it’s charity.
ME: What’s the difference?
PAYPAL: You can use the donate button to raise money for a sick cat, but not poor people.”

After this post was up, people immediately started to take to Twitter and Facebook to complain to PayPal.

Soon PayPal wrote a blog about the Regretsy Issue. They stated:

“Last night we became aware of an issue with one of our account holders, Regretsy.com. Though we can’t comment specifically on the account due to our privacy policy, we can confirm that the funds have been released and we are working directly with the account holder on this matter. Just like anyone else, we believe strongly in helping those in need, especially around the holiday season. We are working with Regretsy to make a donation to help their cause, and we’re truly sorry this occurred.”

Yesterday, April aka Helen Killer, wrote about her “interesting conversation” with PayPal. Turns out, the issue had nothing to do with the donation button as anyone can use it. The executive who called April said, “The information you were given about using the donation button was definitely incorrect, and at the end of the day, it was an error in judgment on the agent’s part.” The issue was really how fast the money was coming in.

Long story short, the big online service company apologized and is even making a charitable donation. Here’s the latest PayPal Update:

“We are happy to offer you $100 donations to each of the 200 families you were planning to support this holiday season. I hope this helps to ease the stress and inconvenience our error has caused. I want you to know that we’re all sincerely sorry for this mistake.” – Paypal

Glad everything worked out well for all parties. But I learned a few things from watching this unfold online.

  1. Be honest. April was really angry to learn that her successful fundraiser was going to be ruined. So she wrote about it on her blog unapologetically. She was truthful, honest and was just being herself.
  2. Humans, not a brand, run customer service. Unfortunately, we all wii come across a customer service representative who honestly doesn’t care what he/she says. They don’t care about the job or about the brand. It’s simply a paycheck to them. It seems that April got this bad seed.
  3. The voices of a thousand could be heard. April would have probably spent countless hours trying to resolve this on her own. If it weren’t for the public who rapidly came to her aid, those kids would not have gotten any presents at all.
  4. Executives really do care what people say about the brand. PayPal is a huge company and they don’t know what agents say to customers on a daily basis unless we tell them. At the end of the day, complaining on social media to get the attention of the decision makers worked. By doing so, you are cutting out the middleman (customer service rep).
  5. I have a favorite new website. I honestly didn’t know about Regretsy existed until a few days ago. It’s funny and sarcastic. So if I ever need a laugh, I can go to the Regretsy gallery.

What did you learn about this situation? How can a company offer better customer service?

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