PayPal Is Latest Case Study of “Don’t Piss Off the Internet”

“You can use the donate button to raise money for a sick cat, but not poor people.”

Seriously, you can’t make this stuff up. This case of “Cats-1, Kids-0” comes to us via a PayPal representative and their recent tangle with a blogger from the popular DIY-mocking site Regretsy. In between posting pictures of why-do-these-exist crafts (and my personal favorite, things that are not steampunk), the folks at Regretsy sometimes harness their power for good and raise money to help people. This year, they created a gift exchange where readers could purchase toys for children in need. The problem? Regretsy used the “donate” button for the cause, which PayPal informed them is only for use by non-profits. (Which is news to me, at least – that’s the same button I see on starving artists’ pages all the time.)

The tale only gets more complicated from there, so I suggest you read the whole post, or the Consumerist recap. The short version is that they couldn’t take donations because they’re not a non-profit, but they also couldn’t sell the toys and then send them to needy kids because PayPal knew what they were trying to do (charity! oh no!) and threatened to track shipments. PayPal also froze the account and the website owner’s personal account. Not to mention that every time something had to be fixed – returning donations, selling gifts, returning gifts – PayPal received service fees.

There are definitely some problems with PayPal’s policies on this matter (and The Green Geeks did a good job of researching this). But the overarching problem isn’t so much the flawed (or at best, utterly confusing) policies – it’s the way the PayPal rep handled the situation, as recounted by Regretsy. If PayPal had been reasonable in coming up with a solution and not done things like distinguish between cats and poor people as worthy causes, then there wouldn’t have been anything to blog about.

Because the thing is, all of this is really good blog fodder – and a perfect recipe for pissing off the Internet. Remember earlier this year when someone at a PR company called The Bloggess a four five-letter word and proceeded to blanket insult all bloggers in a ridiculous email exchange? Or last year when Cooks Source was driven out of business within two weeks because of the response to unrepentant plagiarism?

Maybe it’s not always fair – angry Internet responses are often not proportional to the offense. And there is always the possibility that those with the power of the Internet at their fingertips can use it for evil (I’ve yet to hear about someone purposely screwing with a company out of spite, but it’s not out of the realm of possibility). But in cases where there is any kind of error on the part of the company, lightning fast apologies are the best response, since the longer an issue like this is ignored, the angrier everyone gets. So far the PayPal response seems to be deleting messages on their Facebook wall – and in the meantime, “paypal” is trending on Twitter.

Here’s a tip for all companies out there: Maybe advise your employees to be a little more careful with people who have an army of readers behind them. I mean, in a perfect world, every customer service rep would treat the customer like they have a million Twitter followers just waiting to be mobilized into action. But especially if you know you’re dealing with a popular blogger – maybe just best to assume they have a sign on their forehead that reads COME AT ME, BRO.

Update: PayPal just posted to their Facebook page and blog that they released Regretsy’s funds and will be making a donation toward the cause. Good call with the quick apology! Behold the power of the angry masses.