Free returns are a major selling point for eCommerce and retailers around the world because they provide flexibility and reassurance to shoppers.
Those who don't want to go the wrong size or are undecided on a new purchase can count on merchandise returns and full refunds even during peak shopping periods that follow seasonality and promotions, such as sales and holidays.
The user experience naturally becomes happy and little frustrating if this process is done quickly, easily and securely, which is why we need to constantly improve the ecosystem that organizes online and offline sales.
Businesses today must protect profitability, encourage loyaltyandreduce the overall number of returns. In 2019, unboxing represented one of the main trends, followed in 2020 by supply, while since 2021 the focus has shifted to the environment, for both retailers and customers.
This phenomenon, coupled with rising inflation and energy costs, has led companies in every country and of all sizes to deal with returns while also thinking about sustainability. Customers are demanding as much.
The downsides of returns
There are many aspects that should not be underestimated. Returns tell an impact that is global and involves customers, brands and the environment. Let's look at them together:
- Impact on the customer
Future losses in revenue and higher net cost of acquiring new customers may occur due to returns.
- Impact on brand
From word of mouth to social media, bad experiences create a negative impact on brand perception, future revenue, and a decrease in business value.
- Environmental Impact
From packaging to transportation, the environmental impact generated in the return process cannot be overlooked. Some retailers reuse the packaging received with returns or invite users to do the same.
Social phenomena not to be underestimated to reduce returns
In fashion, in particular, phenomena such as compulsive buying, wardrobing, and bracketing have emerged like wildfire.
Encouraged by consumerism, the agility of returns, and also the need to photograph outfits and review products for social, companies have begun to monitor these buying habits to optimize profits and avoid losses.
Compulsive shopper
Some people buy just for the pleasure of it, especially when they have no need.
The compulsive shopper actually puts large quantities of products in the checkout that he does not need, but once he receives the goods, driven by guilt or shame, he returns them or regrets them.
Compulsive buying brings with it intoxication for the user, but it actually results in serial accumulation of unnecessary items and is often accompanied by financial problems caused by overspending.
So what is often just an innocent banter between friends spinning online and offline stores, hides an addiction not to be underestimated, both for the user and the company facing not a few returns.
Wardrobing
Fraudulent returns include the phenomenon of wardrobing. There are people who purchase a good, use it for one evening, and request a return, then a refund, hiding any signs of use.
Thanks to social media such as Tik Tok and Instagram many influencers, but also users with fewer followers, buy outfits, only to share the outfit of the day or review products.
ASOS and Harrods have been forced to monitor the social accounts of suspects, but this corporate policy requires quite a bit of investment so it is often an exclusive preserve of international retailers and penalizes smaller ones.
To curb the phenomenon in recent years, we have also witnessed the promotion of fashion renting, or the possibility of renting products of interest for a limited time, discouraging their possession.
Bracketing
Who has never happened to buy out of insecurity or simply cluelessly different sizes and colors of the same product to wear and then return it?
This phenomenon is likely to create imbalances in inventories, especially when there are buyers already decided here their own purchases, and is an unsustainable choice that has a cost not to be underestimated.
Some of these attitudes, as we shall see, can be discouraged by sharing more awareness in end users and a more complete and fulfilling shopping experience.
15 tips to reduce eCommerce returns
Sometimes the most meaningful strategies are also the simplest.
We have collected some tips for your business. Useful tips for businesses of any size, in any industry, for eCommerce and retail outlets:
1. Offer fast shipping, products matching purchase
Customers expect their order to contain the products they've purchased, because there's nothing worse than opening a package and finding a black pump instead of a red one. But that's not enough, shipping must be quick because they may no longer need or order a replacement item elsewhere.
This is why it is useful to have an inventory management system that updates in real time, integrated with an order management system, anticipating shipping notifications to follow the right expectations.
2. Make sure the products arrive undamaged at the destination
How much plastic ends up in the garbage at each unboxing?
Even the environmentally unfriendly will puff if they are forced to dispose of large amounts of plastic and paper.
Securely, companies can choose to optimize the cost and choice of packaging while ensuring that these make safe, useful packages to adequately protect the more fragile products they guard.
3. Encourage reviews
In addition to creating more trust in new buyers, reviews are a compass we all treasure, which is why we monitor YouTube, TrustPilot, Tripadvisor, Google My Business, Forums and all the channels where these are collected.
Comparisons between products that offer similar ones allow users to find the one best suited to them and, as a result, reduce the likelihood of being forced to return it.
Very useful are also user reviews.
Receiving honest feedback about the quality, size, and features of a product decreases the likelihood of regretting their decisions.
In addition, retailers gain valuable information about product defects and customer preferences that they can then use to improve the design or quality of their items.
4. Create a clear return policy, don't hide it
The percentage of shoppers who check the return policy before each purchase is very high. This information may not be easy to find on your site or in your stores, hiding it can reduce the conversion of your most proactive customers and generate complaints from those who attempt to return merchandise when it is no longer possible or additional fees are required.
A returns policy should have clear rules and leave little room for interpretation, very often it is added not only in the footer of the site, for example, but also reminded in each product sheet or before check out.
In this regard, don't forget to determine any associated shipping costs and include the return label inside the shipment with all the appropriate instructions for preparing the goods.
5. Think simple return procedure, invest in technology
Coordinating administration, sales, and service hubs is not easy, we know; it requires the flawless coordination of resources and tools. It often generates frustration and dissatisfaction not only in the employees who deal with it but also in customers who do not receive all the necessary guidance throughout the process.
Now think about the technology you use and the processes you can simplify and automate. You can integrate, for example, your CRM with eCommerce and third-party Apps dedicated to managing shipments and returns, to avoid manual actions, increase transparency and trust between retailers, suppliers and customers, while continuing to track returns, capture them and resell them as quickly as possible.
6. Allow returns at your stores, if you have any
Many prefer to return purchases to the store rather than repackaging them and figuring out how to send them back. Those who have stores and want to push even harder at omnichanneling should prioritize policies and processes that allow customers to make returns in person, regardless of which channel they made their initial purchase; this avoids the risk of products being damaged or lost in the mail, saves money on returns, and offers customers special in-store promotional offers to make a new sale .
In addition, customers who buy online and pick up in-store are less likely to return items because they can both try on and exchange products on the spot, have more freedom in deciding when it is most convenient to pick up their purchases, and avoid paying for shipping: a major cause of abandoned carts.
7. Improve user experience: help them buy better
Provide customers with all the detailed information they need to shop better and avoid returns. This means a rich gallery of quality photos (zoom included) to accompany the product description, considering different angles for each item and a short video demonstration. Augmented reality applied to items such as handbags, sofas, or even wallpaper and paint also helps users better understand dimensions and how products fit into their homes, for example.
Create a size table and fit indications with which it can be easier to know if a dress will fit before proceeding with the purchase. Some retailers even use customer data such as gender, height, weight, and preferences to contextualize and suggest the most suitable items.
If the level of trust is low the user will abandon the shopping cart, alternatively, he/she could buy different sizes of the same item and return the ones that do not fit.
Product pages should include detailed specifications and description that are accurate; it is easy to assume that there is a colleague within your department to take care of this. Remember that everything must be responsive, suitable for computers as well as smartphones and tablets where sales take place.
Also add a FAQ section, with frequently asked questions that the Customer Service team is used to answering.
8. Understand what your users don't like
Let's start from the source of the problem to find the right solution. Maybe you followed all the directions, the size chart peeps out with photos and accurate descriptions, customer care is there, on-time shipping
We cannot eliminate returns, but we can study them and, based on the information gained, act proactively to reduce future ones.
Customers are letting retailers know that something is wrong. This is especially important when you consider that most of the reasons for returns can be controlled by the retailer.
You can see all the metrics to be extracted in transactions or reviews from social media, call center contacts, or on the product page.
In all these cases, customers are letting retailers know that something is wrong. It is therefore a matter of listening to them and finding the anomalies. The data is already available: you just need to analyze it.
9. Don't underestimate the importance of quality at the right price
Most returns can be attributed to a purchase not meeting the customer's expectations, which often means quality! The price should be representative of the quality of a good and its expected life.
There are inexpensive moderately priced and high-end versions of almost any product you can think of because each serves different target types: as the price increases, so do expectations.
Companies must take this into account when developing, designing and pricing new products. This means acquiring the right materials and components for various products that will deliver the value that customers expect.
10. Introduce customer scorecards
You have probably heard that Amazon prohibits customers from returning too many purchases. This practice highlights the importance of keeping track of the return activity of all customers.
You can then use this information to develop "scorecards" that show customer spending, customer lifetime value (CLV) , number of purchases, and other relevant numbers along with their return activity. A company can then establish special rules that apply to buyers who exceed certain return thresholds.
As customers increasingly turn to eCommerce, the volume of returns will also increase; companies must identify and implement ways to reduce the number of returned products to prevent their profits from shrinking.
11. Stimulate change: highlight greener choices for returns
Making your consumers think about decisions related to returns is so important. Offer concrete opportunities and easy-to-take, imperfect but sustainable green behaviors, share what actions your brand is taking, and show the impact users can generate if they choose your products, they will feel more engaged.
Retailers can assess the impact of returns, such as through CO2 emissions by carrier, country, and parcel, while customers through "green choice" enhanced online and offline by brands can see which is the most sustainable option for returning products.
Another initiative could be to encourage consumers to walk or bike to deliver products and take advantage of returns to bring packaging to stores.