If Your Returns Service Disappoints, Don’t Expect Repeat Purchases

Returns have been hitting the headlines lately, with around 16 percent of all merchandise bought in 2021 returned by shoppers. In Europe we’ve seen retailers, including Zara, move from free online returns to charging consumers to send back items. Fast-fashion favorite Asos.com has also recently warned its revenues are being hit by rising costs and rising returns.

Perhaps it was inevitable that the boom in online shopping sparked by the pandemic would also drive an unsustainable surge in returns. After all, when you can’t try on dresses and shoes, there’s much more likelihood items won’t fit or look how you expected. Parcels can be damaged in transit too, or in many cases, items just don’t live up to the images on a website. According to GlobalWebIndex, 56 percent of online clothing and footwear purchases are returned.

Scary stats. However, my view is that returns are normal and central to customer experience in the e-commerce age. They don’t have to drag down revenues, but they do need to be managed professionally. There are best practices to take to minimize returns and make the process of returning goods pain-free for your customers.

Getting a Grip on Returns Data

In response to the returns challenge, retailers and their supply chain partners are increasing warehouse space and staff levels, and establishing dedicated reverse logistics departments.

At Asendia, we work closely with our global retail clients to help them analyze returns data and act on insights. At a basic level, we can advise brands which countries and regions tend to return online purchases more than others. For instance, many Southeast Asian countries have very low returns rates, because culturally, the expectation is to keep what you've bought. At the opposite end of the spectrum, shoppers in Germany, the Netherlands and the U.K. have high rates of returns.

It's also possible to pinpoint which product lines are being returned the most and alert retailers to the need to address a manufacturing fault, packaging shortfall or sizing issue.

Apps and In-Store Returns Will Help

Accurate product descriptions, high-quality photography and videos, realistic size models, and digital sizing apps on websites are helping retailers limit the number of orders that don’t fit or live up to customer expectations.

Retailers can save time on manual returns with return management apps. The apps speed up the process, give customers a status notification of their return, and update inventory management systems automatically.

There's also a commercial advantage to encouraging returning purchases to a physical store. Often e-commerce customers who visit the store to return their item will make a new purchase as well as hand back their online purchase. The returned goods can then be inspected and put back on sale for future customers.

You Can Outsource Reverse Logistics

Retailers don’t have to shoulder returns management in-house. Third-party logistics (3PL) partners can handle the entire order fulfilment process, including returns. This is particularly important when you're shipping cross-border to customers around the world. Ideally your parcel shipping partner will have warehouses and regional hubs where returns can be processed quickly and efficiently.

Logistics partners with a global network can give retailers access to reliable cross-border returns services, speeding up the process and operating a more sustainable model. Returns from different countries are sent to a center in the region, where goods can be consolidated before being forwarded back to the retailer.

Pack and Ship Items Securely

Products arriving faulty or damaged will of course need to be returned. GWI research found that this was the main reason for returning goods for 53 percent of U.S. and U.K. online shoppers. There are ways to minimize damage in transit, and the most reliable shipping partners will go out of their way to ship items securely.

Tips on getting goods to customers in pristine condition include inspecting every item before they're dispatched to a customer; using protective material in a delicate package, and always selecting the correct parcel size so the product won’t jolt around when freighted.

Always Keep Customers Informed

For e-commerce businesses, brand perception and reputation are everything. Therefore, it’s worth investing in contact centers and notification systems that keep customers up to speed on the returns process.

Communication can be by email, Messenger or SMS. It’s also important to get regular feedback and ratings on the returns process itself, including how long a refund will take. That’s where you’ll find ways to fine-tune service and set yourself apart from the competition.

Find a shipping carrier that supplies tracking information. Most offer tracking numbers for customers to see the location of their returned parcel. Once it arrives at your warehouse, send the customer an automated message to confirm you’ve received it.

We’re seeing a paradigm shift, while retailers have been focused on sales alone. Now with rocketing return rates, a retooling of the shopping experience is underway.

Douglas Longobardi is executive vice president, sales and e-commerce expert at Asendia USA, one of the world's leaders in international e-commerce and mail, delivering parcels and documents to more than 220 destinations across the globe.