Reviewed October 2021
5 rules for online shopping
Make sure your bargain buying goes to plan.
Online shopping has plenty of attractions but there are also plenty of pitfalls, from hidden costs to shady traders and goods that never arrive. Here are our tips to help ensure your online spending goes smoothly.
1. Know who you’re dealing with
Before you order, check the contact details on the website. Look for a physical address and phone number. Be aware a website with a .co.nz domain name doesn’t mean the trader is based here. It’s no guarantee you’re buying locally.
You can find out who’s behind a .co.nz or .net.nz website on the Domain Name Commission website. For other sites, you can use whois.net.
The New Zealand Companies Register – companiesoffice.govt.nz – is your first port of call to find out whether a trader is registered here.
2. Check the price
Think you’ve found the best price possible on the web? Online retailers are notorious for luring customers with price promotions to tempt you to click “buy now”. But the price can turn out not to be that sharp when service, delivery and credit card fees are added.
You may also fall victim to price discrimination tactics. Your online activity, from your Facebook profile data to the cookies stored on your computer, gives websites clues about your preferences and behaviour. Your purchasing history can also indicate how much you’re willing to pay.
Online retailers Amazon and Orbitz have previously been outed for offering different prices to people based on their location or recommending pricier options to Apple users.
If you’re buying goods worth more than $1000 from overseas traders, be aware you’ll be on the hook for duties and GST when your purchase arrives in the country. You can estimate what you’re up for with the Customs duty calculator.
If you need to return the item – for example, because it’s the wrong size – you may be charged again when the replacement is sent. Customs offers refunds (which it terms drawbacks) on these charges when you return an order, though GST can only be claimed back if the goods sent are not what you ordered or faulty. If you simply change your mind, you’ll have the wear the GST charge.
3. Ignore the sales hype
You know the drill: the website claims the item you’re looking at is “selling out fast” or there’s “limited stock remaining” in your size.
It’s a tactic designed to pressure you into buying on the spot. Resist the sales pitch.
Traders misleading customers about the availability of goods risk breaching the Fair Trading Act and a fine of up to $600,000. If you think a retailer has misled you, make a complaint to the Commerce Commission.
4. Pay by card
We recommend using a debit or credit card to shop online – that way you can apply for a chargeback if the correct goods don’t show up.
Every time you enter your credit card information, check the site is secure. In your browser, look for a small padlock symbol near the address bar in your browser and whether this address starts with “https” (the “s” stands for secure) rather than the standard “www” or “http”.
Take a screenshot of your completed order or save a copy of the order confirmation in case something goes wrong. Keep an eye on your bank statements. If you spot anything unusual – such as two transactions for one item – contact your bank immediately.
5. Know your rights
If your parcel doesn’t show up, you’ll be able to claim a refund if the retailer agreed to deliver an item by a set date. But even if you haven’t agreed on a date, the Consumer Guarantees Act (CGA) requires delivery to be within a “reasonable” time.
Retailers are also on the hook if the item arrives damaged and they’ve arranged delivery – don’t let them fob you off by blaming the courier.
If you make a purchase from a trader operating in our market, regardless of whether it’s a Kiwi-based company or not, it’s covered by our consumer legislation.
Any company conducting business here has to comply with the Fair Trading Act and CGA. However, the CGA is self-enforcing – you’ll have to take a business to the Disputes Tribunal if it fails to comply – so holding a retailer to account can be easier if it has an office here.
Another tactic for getting a company’s attention is complaining on the retailer’s Facebook page or Twitter account.
If an item bought from an overseas trader never shows up, your rights vary depending on the country’s consumer protection laws. It’s worth reporting problems to econsumer.gov, a network of consumer protection agencies. Complaints help it keep tabs on scams and trends.
Chargebacks
If you’ve paid by credit or debit card and strike a problem with the retailer, you can contact your bank and ask for a chargeback.
The process – where the credit or debit card company reverses a charge – can be a buyer’s last resort to remedy a purchase gone wrong.
- Credit and debit card companies set rules about when they will apply a chargeback (for example, if you never received the item or were sent something different from what you ordered). You’ll need to provide details of your purchase and a description of the product, as well as proof of return if you sent it back.
- Chargebacks also apply to fraudulent or mistaken charges, so can be used if the company has charged you twice for an order. But you can’t ask for a chargeback if you’ve changed your mind about a purchase.
- Banks set a time limit on when you can ask for a chargeback, with some specifying two months from the transaction date and others 30 days from your credit card statement closing date. Orders subject to long delivery periods could affect your ability to request a chargeback.
- A successful claim is usually free. If it’s unsuccessful, some banks charge a fee for the investigation time.
- If you’re unhappy with the decision, you can complain to the bank. If you can’t reach a resolution, you can take the matter up with the Banking Ombudsman.
Cover your tracks
To reduce the chances of traders offering you prices based on your online activity:
- Regularly clear your cache and browsing data.
- Check prices using another device (such as your desktop computer against your iPhone) or in a different browser.
- Compare deals before hitting the pay button.
- Avoid using your Facebook or Google account when you buy. It may be easier than creating an account and remembering another password but, depending on the settings you choose, the company may also gain access to a large amount of data on you.
- Log out of sites Facebook and Gmail while you’re browsing.
- See what happens if you only partially complete an order but leave the item sitting in your shopping basket or add it to your wish list. You may find a “special” discount for the item or store pops up in an ad when you’re next browsing online.
Help us keep the pressure on
Consumer NZ is non-profit. To help us get a fairer deal for all New Zealand consumers you can make a donation. We’ll use your contribution to investigate consumer issues and work for positive change.
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