At peak season it is essential that retailers get the returns process right if they are to reap rewards. Our recent research found that almost half of UK shoppers (47%) consider themselves to be a ‘regular returner.’ And with GlobalData predicting the cost of returns will hit £5.6 billion by 2023, it’s clearly a major area of concern but one where retailers can recoup profits.
As an expert in the returns space, providing data-driven insights to key international retailers, ZigZag Global CEO Al Gerrie shares his personal top ten tips on how retailers can make the most of peak season and reduce the often costly number of returns.
1. Improve product descriptions and images
Before diving into the more technical and data-heavy details, a crucial but often underlooked step to optimise returns is by simply improving product descriptions and images on a retailer’s website.
For example, product-specific size guides may often be inconsistent for customers looking to return items.
Too often shoppers will order multiple versions of the same item because of uncertainty over sizing. This will inevitably lead to a spike in returned items that don’t fit. Our recent research found that over half of all returns are due to the item not fitting properly, a number that rises to 69% for women.
A detailed and thorough product description that highlights the nuances of an item will help rectify this issue.
2. Ask your customers for reviews and reward them for it
Simply asking your customers for reviews of your product and returns policy is another easy way to make the process more streamlined.
Our research found that 32% of shoppers aged 18-35 would return less items if they had more product reviews to compare.
Offering incentives and rewards for the customer is usually the easiest way to make this happen.
3. Use a digital returns portal to collect and use data insights
Utilising data has become a key way for retailers to minimise the impact of returns. Retailers use returns portals to collect data insights from the user journey to predict trends and make more informed decisions. For instance, by increasing the carrier offering retailers can help to reduce costs.
4. Identify and combat ‘serial returners’
Data insights can also be used to identify customers who frequently return items – the so-called ‘serial returners’. It allows retailers to make decisions about reducing the marketing outreach to repeat offenders which will in the long run limit the cost of returns from this high-impact group.
5. Improve your picking process
Collecting data from the user journey will also help to make processes in the warehouse more cost-effective and efficient. Order picking is the first stage in fulfilling a customer’s order and it’s essential that the process is flawless to ensure that the packing, shipping, and post-sales activity can run smoothly.
Channelling data to the warehouse can vastly improve this process by reducing the possibility of human error and helping to ensure the right products are delivered every time.
6. Prioritise packaging to minimise damage
Leaving aside the physical impact on the item, receiving a warped, distorted or damaged parcel through the letterbox is a telltale sign that a retailer’s warehouse packaging process is not up to scratch. We know from our research that 46% of returned items were faulty or damaged, so it really is a major issue.
This often occurs when there’s too much empty space left inside a boxed item or if a fragile item hasn’t been adequately protected. Streamlining the packaging process within the warehouse will prevent this from happening and, in doing so, reduce the amount of returned items.
7. Offer ‘refund to account’ or ‘refund to gift card’
Prioritising a flexible returns policy will keep retailers competitive in the current market. Offering multiple options at the point of returns, like a refund to account or a refund to gift card, gives the customer a choice and will save the sale for retailers.
8. Review your returns policy and consider charging for returns in some markets
A diverse policy that adapts and changes to various markets can be extremely cost-effective. Reviewing your policy and considering charging customers in certain markets is a way to do this. It is mainly in the UK and US where customers have long-standing assumptions that returning items should be free of charge. We know there is no such thing as a ‘free return’. So, charging in markets where there aren’t these assumptions is a must.
In addition, charging for returns discourages the likes of the serial returner and also allows you to offer free returns as an incentive to loyal customers or perhaps at peak season or sale times.
9. Offer repair, rental, or re-commerce to get products back into the supply chain
An emphasis on the circular economy and getting products back into the supply chain has to be at the core of a retailer’s returns policy. Selfridges is leading the way in this area having recently announced the aim to have resale, repair, rental, and refill options make up half of all transactions by 2030. Offering the customer these options has the double whammy effect of getting items back into the circular chain and limiting the returns that go to landfill.
10. Make returns the best experience possible for your customers
Providing flexibility and visibility to the customer will show them that as a retailer you value their custom and you want to make their returns process as easy as possible.
A flexible approach can be applied to how and where shoppers return the product to how the refund is delivered.
By offering a range of options, you will appeal to a wider audience. At the end of the day, a happy customer, whether they’ve returned or not, is a repeat customer.
The returns process should not be overlooked as a crucial element of customer satisfaction. Our research shows 62% of customers would boycott a retailer after a poor returns experience.
My final piece of advice is, listen to the customer and take the time to make your returns process as seamless as your purchase process.
Al Gerrie is CEO of ZigZag Global