A solid returns strategy is more important than ever to ecommerce brands.
Get it right and you’ll have customers for life. Yet the slightest slip up will instantly push potential customers straight to your competitors.
Yes, returns can be expensive.
Statista estimates that return deliveries will cost $1050 billion in the US alone by 2020.
(More than a 75% increase since 2016!)
So the question is – do you really need to invest in getting your returns strategy right?
Can getting it wrong be that detrimental for ecommerce brands?
The short answer is YES.
Not convinced? Here are five data-backed reasons to sit up, take note and make returns your top priority in 2019.
1) Returns are now standard practice
Returns have long been a part of the ecommerce landscape. But consumers are utilising this aspect of the buying process more and more.
A recent survey of 1,000 shoppers by Return Magic found that:
- 89% had returned an online purchase in the last three years.
- 41% regularly buy items in multiple sizes and variations with the intent to return unwanted versions.
Meaning two out of every five customers plan to return at least part of their order before even completing payment for it.
And what’s more:
ReBound’s Rethinking Returns Report discovered that 92% of respondents rated returns as being important to them. With 49% going a step further by admitting it to be “very important”.
All showing returns to be a crucial pillar in the ecommerce shopping journey. And one you need to get right in order to succeed long term.
2) Younger generations want returns even more
Rebound’s report also reveals a compelling trend when it comes to returns:
The younger the consumer, the more likely they are to crave a quality returns experience.
So much so that 60% of 18-25 year olds said that a negative returns experience had resulted in them not shopping with a retailer again. Compared to just 30% of people 65 and over:
- Returns are important to everyone – and are only going to become more so as time goes on.
- The younger your target market, the higher up returns experience needs to be on your priorities list.
The key word here is experience.
People want more than reassuring wording and fancy promises in your returns policy. They want to know you’re able to consistently follow through on those promises without any complications.
3) Returns can make or break conversions
People want to know there’s a way to back out of their purchase if they need to. And so they care about the details of your returns policy – a lot.
The same Return Magic survey mentioned earlier also concluded that:
- 83% of people actively read a merchant’s return policy before making a purchase.
- While 71% admit that a shipping or restocking fee can prevent them from buying.
To compound this:
Recent Comscore research found an unclear returns policy to be the second biggest reason for cart abandonment among respondents.
All this shows just how important your returns policy is to potential customers.
You could have all the fancy retargeting ads and conversion plugins in the world. But a confusing and unattractive returns process could be turning huge numbers of people off buying.
4) Returns are an opportunity to get ahead
Another interesting trend revealed by the Return Magic survey is the huge gap between consumer desire and merchant supply when it comes to returns.
All the data mentioned so far shows how in-demand a quality returns process is among shoppers.
But the survey revealed that a whopping 80% of people expect free returns. And Multichannel Merchant back this up by putting the figure at 79% in a separate study.
Only a measly 25% of merchants actually offer free shipping as standard.
Meaning there’s a vast difference in what consumers want and what ecommerce companies are currently offering. And leaving your brand with an opportunity to get ahead of the pack if you act now.
5) Returns drive repeat buyers
Returns go way beyond improving initial conversions among first-time buyers.
People see them as so important that they’re willing to stick with a brands providing a positive returns experience.
Return Magic’s survey also goes on to reveal that:
- 72% of consumers say they would spend more and buy more frequently with merchants that make the return experience simple.
- 77% of returns are done by repeat shoppers who are actively engaged with the brand.
- 89% of repeat customers who had a good experience are likely to buy again.
All unequivocally suggesting online retailers need to focus on solidifying their returns strategy if they want any chance of retaining customers.
Retailers doing returns right
All this begs the question:
What does a quality returns strategy actually look like?
Here’s a look at a couple of retailers doing it right:
The driving force of Zappos’ success?
Their now famous attitude to customer care. With returns a huge part of this.
In fact, Zappos don’t just provide free returns. They provide free returns for a full 365 days after date of purchase:
They also make their whole policy undeniably clear and super simple for customers to complete:
A 365 day return policy looks ridiculous at first glance. A great example of a massive retailer using their cash flow stability to edge out the smaller brands.
But let’s analyse this for a second:
- Returns must be unworn.
- Returns must be in original state and packaging.
Unless someone literally forgets they even made the purchase for an entire year, it’s unlikely they’d be able to meet these conditions. E.g. Nobody could wear a pair of shoes for 364 days before returning them for a full refund.
The research in Rebound’s Rethinking Returns Report also shows there to be little difference in the average time it took customers to return items. Even with an extended return policy length:
So what’s the point?
It shows how confident Zappos are in their products as well as how much they care about their customers. And shoppers feel greater peace of mind, much less buying resistance and greater trust in the Zappos brand.
2) Glasses Direct
Glasses Direct are an ecommerce brand selling (unsurprisingly) eye glasses.
But what’s the biggest problem with selling glasses online?
People really need to be able try the products on before buying. And not being able to do so is a huge turn off when it comes to buying online in this niche.
So Glasses Direct use returns to their advantage.
They created a free Home Trial that allows people to order up to four pairs of glasses to try on at home before being charged:
- Try on the frames for seven days.
- Select their favourite pair(s).
- Send them back for free.
- Have their preferred frames delivered with correct prescription lenses.
Glasses Direct make sure to collect payment details at the initial request for a home trial. Meaning they can charge people should frames be damaged or not be returned.
They also do a great job cutting down on serial returning through high-quality guides and blogs on choosing the best frames for your face.
Returns are becoming a more and more vital part of the ecommerce buying process.
So you not only need to have a clear and attractive policy in place. You need to be able to consistently follow through on that policy.
But this isn’t as daunting as it might first seem.
Work out a policy that aligns with your customers’ expectations. Then use a quality management software that can handle the returns process from every channel in one place.
Have you noticed a recent returns uptrend in your business? Let us know in the comments below what you think of the current state of ecommerce returns.