Interviews, insight & analysis on Ecommerce

Why acing your returns process matters

by Carmen Carey, CEO, Sorted

New research has shown that online retail sales have been falling in recent months, amid fears that inflation may be stunting the UK’s economic recovery and squeezing household finances. This being said, even in the midst of the lowest rate of online retail growth ever recorded, retailers are still finding innovative ways to attract customers.

With fewer consumers buying goods, the competition to attract and retain customers is hotter than ever. Retailers need to ensure they are getting the Ecommerce experience spot on to keep the customers that are spending.

On top of this, returns represent a big pain point for retailers. A survey by the National Retail Federation found that retail returns for online purchases went up from 18.1% in 2020 to an average of 20.8% last year. The trend looks set to continue – since Christmas, returns have surged by 24% on the year before.

Returns don’t just cost money; they also have an impact on how a brand is perceived. How a retailer handles its customers’ returns has become a key differentiator and a key part of the customer journey. A seamless returns process gives customers a sense of security. If a retailer doesn’t provide this, then consumers often avoid buying the product in the first place. The returns process therefore holds a lot more power for brands than they might think. 

In a recent survey, we discovered that 81% of consumers would shun a retailer if they saw issues with their return process. Furthermore, 44% would not re-order from an online retailer if they had experienced issues with their return process. It is clear that brands need to be upping their returns game should they want to keep their customers sticky. 

But it’s not all gloom and doom. Our survey also found that if returns were made easier, 61% of consumers would prefer to exchange a product bought online, rather than get a refund. Since an easy returns process is the best way to convert a return into an exchange, brands need to be getting this part of the journey right in order to keep the cash. After all, the consumer journey doesn’t stop when a delivery reaches a customer’s door, so retailers need to ensure the process is seamless at all touchpoints. 

Some brands have already seen this as an opportunity to attract consumers rather than losing them. Walmart, for example, bought a virtual fitting room start-up last year to help with its online clothing sales. Other businesses, including Amazon, have taken a different approach to returns: refunding consumers but not bothering with going through the painful and costly process of getting bulky, custom-made or low value items returned to them.

So, what else can brands do?

Most customer returns can be controlled or even avoided completely. For example, shipping the wrong items or providing poor product quality comes immediately under this umbrella. They’re a straight ticket to a return and should be avoided at all costs. You then have those returns that are within your influence but, overall, out of your control. For example, the customer ordering the wrong size of clothing or simply changing their mind.

In this case, having a self-service online portal where customers can easily open returns requests can make a difference to where shoppers buy. According to our survey, 89% of consumers identify ease of returns as top priority when purchasing online and 77% said that getting timely updates on the progress of their return, refund or exchange would make them more likely to purchase from that retailer again.

Additionally, retailers need to give sales and support teams access to data-driven insights to help them make key decisions. For example, if a particular product is seeing an unusually high return rate, the team will know about it right away and have the chance to reduce the rate. With an online return portal, customers can also select their reason for returning products, so return causes like high defectivity or ineffective packaging causing damage in transit can be easily identified.

Ultimately, a positive returns experience is playing an increasingly important role in attaining customer satisfaction and loyalty. In today’s competitive and crowded market, a returns process that is convoluted, complex and cannot provide proactive updates, will only send your customers packing.

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