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As a retailer, if you’re constantly dealing with and nightmarish logistical challenges, know that you’re not alone. Returns and refunds are inevitable for e-commerce businesses, as customers can’t see or touch the products before buying.
But here’s the thing to remember: Customers dislike returning products. And the only thing they detest more is a cumbersome, unclear, or lengthy return process.
In fact, found that 92% of respondents say a brand‘s returns policy sways their purchase decisions. In addition, 62% of shoppers say they are unlikely to shop with a retailer that provides a poor returns experience.
In this article, we’ll explore the challenges and pitfalls of e-commerce returns management and share some best practices for improving the returns experience and boosting customer satisfaction. We’ll also cover the role of returns management software and how it can help improve your practices.
Managing e-commerce returns isn’t easy, which is why most retail experts believe the best way to deal with them is to minimize their occurrence. How? This is something we’ll explore in the subsequent sections, but first, let’s look at some of the pressing challenges in e-commerce returns management.
In 2022, clothing topped the charts at 26%, followed by bags & accessories, and shoes, at 19% each, in the list of most returned online purchases in the US. As such, managing a high volume of returns can be pretty challenging, particularly in peak seasons like or promotional events. Needless to say, it should be a priority for brands to reduce return rates.
A study found that returns in the US alone generate 15 million tons of carbon emissions and five billion lbs of landfill waste every year. That’s equivalent to the amount of trash produced by five million people annually!
Did you know that consumers are 3-4X more likely to return items bought online than products purchased in-store? However, the vast majority of retailers (81%) still do not have a strategic returns program in place. They simply continue to perceive returns as a cost of doing business.
Fortunately, there are some tried-and-tested strategies that can help you minimize returns to a large extent. Here are a few of them:
Our research shows that 33% of shoppers have returned items due to size and fit issues—and it’s the top reason behind product returns.
The best way to tackle this is to use customer data to propose the most appropriate sizes for shoppers.
For example, athleisure brand Fabletics offers detailed product descriptions on its website with information on the type of fit (light to max compression), size guide, and performance features (chafe resistant, moisture wicking, etc.).
The site includes a fit survey that collects data from shoppers on how a product fits (e.g. true to size, runs small, runs large, etc.). In addition, customers can upload pictures of the product and submit their reviews. The site also asks visitors to fill out an attribute survey to understand the customer’s body type (athletic, lean, petite, curvy, etc.) so it can recommend the best products for them.
You may even take a leaf out of Walmart’s book that now offers a “virtual try-on” feature on its app and website to help customers visualize how a particular item of clothing may look on them. Shoppers can upload their photos and superimpose clothing products on them to get a sense of the style and fit before buying a product.
Another popular tactic that many online retailers (including Zara and H&M) are now using to minimize product returns is to charge customers for returning products.
Although free returns help to boost customer retention and loyalty, charging for returns can be especially helpful at thwarting “bracketing,” a practice where customers buy multiple sizes or colors of a particular product with the intent to retain the best variant and return the ones that are unsuitable.
According to Gaurav Saran, CEO, ReverseLogix, “Making returns easy for consumers is a way to create a loyal customer.” If you can make the process as seamless as possible, returns can be a “superpower.”
With that in mind, here are a few best practices you can adopt to improve the returns experience for your customers:
A clear return policy can help set customer expectations appropriately and reduce the risk of dissatisfaction. This is especially important in the current landscape, where 92% of respondents say a brand‘s returns policy sways their purchase decisions at least some of the time.
So make sure that your return policy is displayed prominently on every product page. It should include information on the types of items that are eligible for returns, the costs (if any) associated with them, and the time frame within which they must initiate the return.
Besides your return policy, you must also display the steps involved in your returns management process with clear instructions for customers. There should be no room for ambiguity. You may even create an easy-to-use where customers can generate pre-filled labels or QR codes and process their returns without any involvement from your company.
That’s exactly what did to streamline returns for its customers.
The company implemented a new returns process in 2020, utilizing parcelLab’s order status page and returns portal to replace its previous analog system. As a result, customers no longer receive a physical returns label with their orders. Instead, they must register their return on Conrad’s online store to obtain either a QR code for their smartphone or a label to print.
Although this requires slightly more effort on the customer’s part, they can now track the status of their return online.
Conrad’s switch to an online portal gave the brand several advantages, including:
Make sure to let your customers know about your policies for returned products that cannot be restocked. Also, mention the methods you use to dispose of them sustainably (e.g. recycling or donating them to charitable organizations, etc.).
Be sure to gather data on customer returns—including how often they happen, which products have high return rates, and more. By analyzing returns data, you can identify patterns or trends that may indicate issues with your products, website, or internal processes.
For instance, if a particular product is frequently returned due to sizing issues, you may need to update your size guides or provide more accurate sizing information. Or, maybe you discover that products are often damaged in transit; in this instance, you may need to evaluate your shipping practices to avoid mishaps.
Whatever the case, collecting—and acting on—returns data can lead to smarter processes, improved customer satisfaction, and reduced costs associated with returns processing and restocking.
As we said from the get-go, product returns are inevitable. Follow the e-commerce returns tips mentioned above to nip them in the bud and protect your bottom line. At the same time, make sure to communicate your return policies and processes clearly to customers so you can set expectations and build trust and loyalty with them. To learn how you can achieve all this seamlessly, contact parcelLab today
Read all of the Returns Management Playbook Chapters: