The cost of a negative returns experience
Almost 21% of last year’s online sales were returned, totaling about $218 billion. That’s a significant portion of the more than $1 trillion generated through online commerce. The losses to a retailer, however, are deeper than “just the cost of the returned item.”
A return doesn’t need to be the end of the customer relationship. How a business handles it, however, can make or break it.
As customer expectations skyrocket for online shopping, retailers have the added pressure of keeping customers happy during peak shopping times such as Black Friday, Cyber Monday, and the holiday season. It’s critical to ensure that every customer touchpoint is positive – from browsing to buying – and even returning or exchanging merchandise.
How eCommerce retailers can set themselves up for success
Ensuring that the returns process addresses speed, cost, and convenience helps to retain customers. Behind the scenes, utilizing multi-carrier software is key. It helps fulfill deliveries faster by automating tasks that are manual and time-consuming. Retailers and brands can streamline shipments across various carriers within one post-purchase platform. The software helps businesses save money, reduces human error, and enables bulk label generation. Retailers can respond to customer needs more quickly with automated processes and tracking.
A convenient returns process
A recent AfterShip survey of approximately 450 consumers found that 35% would not return to a retailer if there were a shipping or restocking fee. About 27% of shoppers cited that slow processing times as the most frustrating aspect of an online return, while 23% say paying a fee is the most frustrating.
Automated returns
Around 44% of shoppers rated return notifications as one of the key elements of the best returns experience. A notification process that includes embedded and engaging marketing assets within the messaging can encourage shoppers to convert returns into purchases.
Implementing an automated returns process allows retailers to streamline the returns experience for their consumers and themselves. They can simplify the entire process from the moment a return is requested to the point it gets resolved. Retailers set their own rules and conditions, which helps avoid overstocking, reduces returns, and decreases costs.
In fact, one AfterShip Returns Center customer saw a 97% decrease in the time spent on the returns process, had twice as many exchanges compared to returns, and 1.5x decrease in refund requests after implementing our software.
Status updates
Retailers can also drive customer loyalty and reduce customer inquiries by offering proactive returns status updates, which can include pending status, approval or rejection of the return, receipt of the customer shipment, and the resolution.
Sharing an estimated delivery date (EDD) of the return shipment with customers can go a long way in driving higher conversion rates. Accurate EDDs have also been shown to increase sales and reduce ‘Where is my order?’ (WISMO) inquiries by showing customers their deliveries are actively monitored and on track to arrive as planned. Some retailers that display EDDs see up to a 75% decrease in WISMO tickets.
An easy-to-navigate website
Customers want to find information easily, so a straightforward website goes a long way toward customer satisfaction. Another important detail that is often overlooked is including link displays in the site’s footer. In an effort to build trust and rapport with current and future customers, direct links to pages that provide order status, delivery tracking, and return policy should be visible.
Offer exchanges
AfterShip customer Nikolas Callas, Director of Operations for Marc Nolan men’s premium shoes, said that the company saw a significant benefit in offering exchanges. “More often than not, we had issues where we’d get a return where our customers wanted something, but it wasn’t available in inventory. They would have no choice but to get a refund. That was a really poor experience for the customer. It’s frustrating for them,” he said.
A clunky returns process negatively impacts the bottom line
AfterShip’s survey also found that 27% of respondents reported that slow processing was the root of their negative returns experience, closely followed by an unclear returns process, which was cited by 20% of respondents.
Negative returns experiences can turn a customer off for life. Keeping existing customers is less costly than acquiring new ones; therefore, it behooves a retailer to have a seamless returns process. Investcpro.com notes that existing customers are 50% more likely to try new products and spend 31% more than new customers.
A clunky negative returns process can negatively impact a brand’s reputation. Customers expect leading brands to have tech-forward, seamless, and automated processes for returns. A negative returns experience can ultimately lead to a negative customer review, which may affect future purchasing decisions from potential shoppers. According to Power Reviews “95% of consumers use reviews, and 86% say they are essential when making purchase decisions.”
The bottom line
Although negative returns experiences can turn shoppers off for life, a positive one has been shown to retain customers, boost revenue, and create positive brand impressions.
Andrew Chan is the Co-founder and CPO of AfterShip, the game-changing post-purchase platform for online retailers such as Etsy and brands including Dyson and Kylie Cosmetics. He is an eCommerce, post-purchase, SaaS, and shipping and logistics expert with more than a decade of experience in the industry. Andrew has been quoted by outlets such as TechCrunch, Business Insider, TotalRetail, PYMNTS.com, and more.
