In a recent eDelivery webinar, Returns, Fact or Friction, CML’s business development manager Jane Smith and commercial director Kerry Delaney turned their attention to the issue of returns. Here’s a bulletpoint overview of the session.
Jane Smith, business development manager at CML, opened the webinar by saying that when she buys online she always checks the returns policy – and she’s not alone in doing so.
Shopper expectations of online returns
- 58% of shoppers are satisfied with how easy it is to make an online return.
- 68% check the returns policy before buying – though it can be hard to find the policy online.
- 48% would buy more with online retailers who offer hassle free returns – shoppers are fickle, the easier it is to make a return, the more likely it is to happen.
Why people return
- Maximise order value – to get free postage.
- Gift items returned – especially over Christmas.
- Customer changed their mind. “We’re all human, it happens”.
- Products not matching their online descriptions.
- The wrong item is shipped out – “how frustrating for your customers if in your 3PL operation there are mispicks.”
- Problems with fit or product quality. First-time shoppers from a brand may not be familiar with size so order more than one size.
- Damage in transit
“It is a fact that free returns increases the gross merchandise value and the order value,” said Smith. “Often it’s what encourages the sale in the first place. But it has to be sustainable. By giving shoppers what they want, it will set you aside and win you loyalty – the difference between a successful ecommerce growth strategy, or reliance on a fickle customer case and the offers of the day.”
The elephant in the room: free returns (and delivery).
Kerry Delaney and Jane Smith talked through the main areas that retailer customers think about when deciding whether to offer free returns, from avoidance and denial through to silence and awkwardness.
- The importance of an agile logistics relationship: crucial to get the back end right to ensure service strength and deliver on the customer promise.
- Free returns: prevents abandonment at the basket and boosts sales. 60% see returns charges as an absolute deal breaker. But shoppers are happy to wait longer for free returns/delivery. But, visibility on all returns is key so the customer is able to track their refund.
- Social media comments show friction in returns can be a real issue for shoppers – and they can be quick to share their experiences. “If it’s negative, customer delight soon turns to disaster.”
Important to pre-empt returns through the returns policy.
- Customers want to know: how returns work, how much they cost, what the policy is, if there is a free returns policy/paperwork in returns parcel. Notification about the status. Who do I speak to with a question? How long does it take to get the money back?
- Most online customers expect a pre-paid shipping label or at least an online portal system for returns so they can print a label if they need to send an item back. But older customers may not be able to do that.
- Importance of getting the method right – if not, inventory isn’t returned to sale quick enough, makes the impact of refunds slower for the customer. Most shoppers want their return in a week – if can’t maintain that, what impact does it have on customers.
- Super mature ecommerce companies are now offering try before you buy – eliminates refund/returns frustrations before the transaction takes place.
- Emerging technology issues, such as returns for websites that accept bitcoin.
Returns: the options
- Average online shopper wants the convenience of returns process – don’t want to be inconvenienced. Returning to supermarket eg Asda/Morrisons. Drop boxes CollectPlus.
- Emerging trend to have online portal rather than a label in the bag (but more returns options the better, customer feels in control, making a lifestyle choice with as little friction as possible.)
Live information without the costly exercise of renewing packing slip etc.
- Return to store: results in upselling through new services etc.
- Return conditions.
- Returns from overseas – have to take into account legislation in third-party countries – customers, paperwork. Especially with Brexit coming up. Uncertainty and lack of commitment from the government on what the plan is. This is a case where a 3PL with bonded warehousing can really help. May even want to think about international returns specialists, eg Global-e, Borderlinx.
- Customers need to understand how to send it back, eg original packaging.
- 3PL provider needs to be able to deal with fraudulent returns etc, monitoring.
The webinar was followed by a Q&A session. To view this and previous webinars in full, including the slides and the Q&A session, visit the InternetRetailing video channel
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