UK fashion retailers are losing money due to fraudulent returns practices such as ‘wardrobing’, according to a new report.
The survey of 2000 online shoppers and 200 online clothing retailer by returns company ReBOUND found that 13% of consumers have purchased clothing with the intention of wearing it once and then returning it for a refund, known as wardrobing.
The tendency was particularly high amongst 25 to 34-year-olds, 21% of whom admitted to doing this. By contrast, the figure was only 6% for those over 45 years old.
Of the retailer respondents, 62% said that the cost of wardrobing was significant to their business while 23% said it was “very” significant.
ReBOUND said that the practice could lead to additional costs including additional courier charges, processing costs and damaged goods. The latter could also risk damaging brand reputations with future shoppers if stock is in poor condition.
However, while 43% of retailers believed their returns strategy needed improvement, only 20% saw investing in the returns experience as one of their top priorities. This compared to 60% and 58% for the browsing experience and the delivery experience respectively.
Vicky Brock, director of data innovation at ReBOUND, said: “It’s tempting for retailers to adopt a ‘one size fits all’ approach to returns, but banning shoppers for repeatedly returning items overlooks that individual customer’s lifetime value.
“An effective returns strategy requires a nuanced, data-driven approach, as this will highlight that even the majority of customers who ‘wardrobe’ still keep more than they return. By banning repeat returners, retailers risk alienating shoppers who spend far more than they claim in refunds.”
Figures released last week by the Centre for Economic and Business Research calculated based on a returns rate of 25% that £4.8 billion of goods bought in the UK during the 2018 Christmas period may be returned.
The problem is not just limited to the UK, with digital association Bitkom finding in a survey of 1000 German online shoppers that 12% of online purchases get returned. According to German clothing seller Zalando, 50% of products purchased get returned.
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