5 rules for online shopping

Make sure your bargain buying goes to plan.

Woman in cafe shopping online with laptop.

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.

Selecting Facebook icon on mobile phone.
Your online activity, such as your Facebook profile data or purchasing history, can indicate to traders how much you’re willing to pay.

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 with Custom’s 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 incorrect 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.

Stay in the know

Keep up-to-date with Consumer's latest news, investigations and product and service reviews, plus join the Consumer panel with invitations to take part in surveys.

Member comments

Get access to comment

Mark H.
28 Oct 2017
It is definitely worth picking and choosing who you order from!

There are plenty of online sellers overseas that are really good to deal with, have good prices and are reliable. Avoid the scammers and those that charge insane shipping costs and you will generally have a good experience. Also make sure that electrical items will work with 240V power, most will but you don't want a 110V item that wont work here.

I rarely buy something that will attract GST and/or duty because of that $50 charge, not exactly a level playing field once you factor that in. I'll normally buy things that are cheap enough not to need to pay GST on or dear enough that the $50 isn't such a big deal.

Steve K.
28 Oct 2017
Fake NZ Shopping sites

Having been stung twice already this year (luckily using CC so able to chargeback) I just checked out this "local" website, and... https://dnc.org.nz/whois/softwarecity.co.nz
Thanks Consumer.

Jane H.
28 Oct 2017
Worth a look

Just used https://dnc.org.nz/ to look at a few websites that I use to purchase from and great to see who we are dealing with.

Jane H.
28 Oct 2017
Timely advice

Thank you for posting information in regards to online shopping. It is greatly appreciated.