Analysis

Opinion: Why returns need to be part of your marketing strategy

Customers expect returns to be as easy to do as their initial purchasing and they also offer retailers the ability to win customer loyalty but are retailers doing enough asks Frank Lochbaum, managing partner at KPS.

Unfortunately, while returns are a big part of today’s retailing, too many retailers are heavily focused on securing the sale and then the logistics of getting that purchase delivered, meaning that they are potentially ignoring the issue of returns.

But returns can cripple a business if they’re not dealt with swiftly and correctly – you just have to look at the numbers. A survey for Radio 4’s You and Yours programme last year found that two thirds of shoppers who had bought women’s clothing online had sent at least one item back.

What’s more, shoppers now expect returns to be part of their shopping experience. The immediacy of online retailing, where you can buy whatever you want whenever you want, to be delivered at a time and place convenient to you has great appeal, but so does being able to return any unwanted item easily and conveniently.

Customers expect an easy returns process

Instead of traipsing around shopping malls, shoppers are buying online, choosing multiple items and using their bedroom as a changing room. This means, just as in a physical store, some of those items won’t be right and will need to be returned. And, just as that initial click-to-purchase was easy, these shoppers expect the returns process to be simple too.

Shoppers who are dissatisfied with a returns process will cease being loyal customers and may spread the word that they have had a disappointing experience with a brand and, if this goes viral on social media, it could have a major impact on sales. So, instead of ignoring the issue of returns, retailers need to tackle them head on.

First up, the reasons for returns need to be analysed to see if any issues are frequently appearing. These could be to do with the product descriptions not being as precise as it should be or that sizing charts need adjusting, perhaps. Problems such as these can be addressed relatively easily and quickly, reducing the potential amount of returns for the future and making the customer experience more enjoyable and smooth-running.

But returns are inevitable, especially when online shoppers may look to buy two differing sizes of the same product and return the item that doesn’t fit. As a result, all retailers should have a returns strategy in place, and this strategy needs to be viewed as part of the marketing mix. So, in the same way that an item is processed after a customer makes a purchase, when it comes to dealing with returns customer service levels must also be upheld, as this is an opportunity for a negative encounter to be turned into a positive experience for the customer.

By having processes in place that enable the retailer to provide an omnichannel offering to customers from end-to-end, and beyond the point of sale, retailers should be in a better position to evaluate where improvements can be made to ensure that the customer remains happy throughout their buying journey, and even after they have returned an item.

Strategic targeting

For example, it should be remembered that not all returns are completely negative. As previously mentioned, the customer may have bought two sizes to try, knowing that one would be returned. This is a prime example of when a retailer can strategically target that customer during the return process by suggesting complementary items that will go with the item they have chosen to keep – thus encouraging further spend.

However, the key to success with returns is down to convenience. Retailers need to ensure that returns are as easy as the purchasing or delivery scheduling for customers. This will ensure that the frustration of returning an item can be eliminated and the shopper will remain loyal to the brand.

Offering free postal returns is a great way of providing greater convenience. Our recent research into cross-channel activity found that free returns were important to many shoppers, with 51% of those surveyed saying that will not order from a company that does not have a free returns policy.

Opening up channels

Retailers should also consider appealing to omnichannel shoppers by opening the returns process across all channels, allowing online orders to be taken back in-store and in-store purchases to be returned via post. Our research found that 63% of shoppers wanted the option to return a purchase to a different channel to what they brought from, if they ordered online, for example, they wanted to be able to return it to a bricks-and-mortar store. And 41% of those surveyed said they would be less likely to order a product online if they could not return it to a store. This cross-channel approach to returns will open opportunities for shoppers to browse shop floors and potentially make further purchases.

Returns are a good example of a transaction that looks like a short-term loss but could prove to be a long-term gain. If a new customer purchases five items from a retailer but sends four back, they could just be getting to know the brand. And, if they have a good returns experience, they’ll be more inclined to use that retailer again and recommend them to a friend.

Such brand confidence will result in less shopping around and more time spent with a retailer the customer knows they can rely on – whether that’s for purchases and / or returns.

Frank Lochbaum is managing partner at KPS

Image credits: KPS and Getty Images