You may have noticed that your consumers tend to initiate returns after their online purchases more frequently than after their in-store shopping. On average, returns for ecommerce transactions are two to three times more likely than purchases made in brick-and-mortar stores. Since online shopping and returns skyrocketed in recent years, ecommerce retailers and online divisions of omnichannel retailers are turning their attention to the cost of returns and their impact on the consumer experience. It is no longer sufficient to write returns off as a cost of doing business, they need to be included in the overall sales and consumer retention strategy. (A poor return experience will deter 95% of shoppers from purchasing from your brand again.)
Be Part of the Solution
Based on data from Incisiv, 73% of retail returns occur due to reasons your business can control, like inaccurate product descriptions, wrong items shipped, fit, or quality issues. If your job involves sourcing, stocking, shipping, packaging, sizing, communicating, promoting, or persuading, then you influence return rates at your company.
Unify the CX across all channels to make the omnichannel return process consistent and as frictionless as possible.
Unfortunately, omnichannel returns get lumped together with insufficient understanding about why they happen and whether a specific return helps or harms the business. Return policies tend to be static, rigid, and overarching. On their own, they don’t allow customization based on individual return history or policy adjustment for loyal shoppers.
How can you find and use the information returns provide?
Step 1: Expand your view
Accept that returns are part of the bigger picture of how your omnichannel retail company functions. Returns give you deeper insight into your consumers’ behaviors and preferences and help you find ways to improve the products being sold. Returns also offer an opportunity to differentiate your company from competitors, build consumer loyalty, and trigger new purchases.
Step 2: Evaluate
Learn why returns happen in your business, and take steps to make operational changes to reduce them (this will likely touch all areas of your business from sourcing to marketing). Consider sharing information among other stakeholders at your company to address concerns holistically.
Step 3: Leverage your consumer data
Analyze your database of individual shopper information including historical omnichannel transactions and use the information to make smarter, more informed decisions to optimize returns in real-time.
Step 4: Improve the experience
Unify the CX across all channels to make the omnichannel return process consistent and as frictionless as possible. This can mean improving your processes for popular services such as buy-online-return-in-store (BORIS) and RMA requests.
Step 5: Measure profits and costs
Do you know your overhead costs for a return? Are you aware of pricing policies related to returned merchandise? Does your company use a reverse logistics company for all returns? Once you understand the costs, you can evaluate ways to improve profitability. For example, by optimizing processes like encouraging BORIS vs. shipping returns, you can improve the consumer experience, reduce overhead, and encourage add-on sales.
In retail, returns are everyone’s business. By evaluating your store’s return volume and causes you can take a multi-pronged approach to reducing return costs and leveraging opportunities.
Identify Growth Areas
How can you rise above and differentiate your company’s return experience? Incisiv researched 100 industry-leading omnichannel retailers and discovered numerous strengths and weaknesses, among them:
- While 80% of retailers offer consumer reviews and ratings, just 9% provide virtual try-ons and augmented-reality tools
- Only 35% of apparel retailers offer sizing/fit tools online
- 80% of retailers have a return policy mentioned on the site, but only 13% allow shoppers to initiate and track exchanges online
- 85% of omnichannel retailers offer BORIS, but only 13% allow the return of clearance sale items
- 100% of retailers have FAQs, consumer service, and other self-help options available for returns, but just 18% of retailers allow shoppers to track their return/refund status
In retail, returns are everyone’s business. By evaluating your store’s return volume and causes you can take a multi-pronged approach to reducing return costs and leveraging opportunities. Enabling your consumers to have a more precise shopping experience will reduce their need to make a return, helping your bottom line (and reducing the
15 million metric tons of carbon dioxide produced from returns every year). If they do have to make a return, you can ensure a positive experience, creating a willingness to shop again in your stores or online.
