Amazon working on gift-reject service

Undoubtedly, the Thread and Bobbin Sewing Kit that Aunt Mildred sent from Amazon.com for Christmas will never see a stitch. The Stallion Stable Music Box might have looked pretty on the computer screen, but under the tree's flickering lights it is frightful.

These gifts sent via some warehouse many miles away are not only unwanted, but also a multimillion-dollar headache: They have to be repacked, labeled and shipped back to Amazon's Island of Misfit Toys. Then a new present has to be packed, labeled and shipped again. Efficient, the process is not.

Amazon is working on a solution that could revolutionize digital gift buying. The online retailer has quietly patented a way for people to return gifts before they receive them, and the patent documents even mention poor Aunt Mildred. Amazon's innovation, which was not ready for this Christmas season, includes an option to "Convert all gifts from Aunt Mildred," the patent says. "For example, the user may specify such a rule because the user believes that this potential sender has different tastes than the user." In other words, the consumer could keep an online list of lousy gift-givers whose choices would be vetted before anything ships.

Amazon's idea has raised the ire of the Miss Manners crowd, which thinks the scheme rather uncouth. After all, receiving an e-mail notification of a forthcoming gift - and thereby being able to check its price - is hardly the same as unwrapping the item at home.

Anna Post, great-great-granddaughter of the late etiquette author and spokeswoman for the Emily Post Institute, said she hopes the company realizes it is risking major backlash and abandons the idea. Because of Amazon's dominance online, she and others say they fear the idea could spread through the e-retailing industry, which this holiday season racked up $28 billion in gift purchases.

The proposal has also brought into focus a very costly part of the e-retailing business model: Up to 30 percent of purchases are returned, and the cost of getting rejected gifts back across the country and onto shelves has online retailers scrambling for ways to reduce these expenses. "It's in the millions of dollars, and it might even be billions," said Carl Howe, a Yankee Group consumer technology analyst.