Keep Your Returns Policy Focused on Customers

By Carle Henry

Online sales continue to grow as a proportion of overall retail sales, and returns are growing at an even faster rate. With the holiday peak season upon us, retailers will need to focus more than ever on handling returns in ways that avoid alienating their customers — and consequently losing future sales. Given the rising challenge, how are you going to make your returns processes shine this peak season?

Returns are an intractable fact of retailing, already averaging nearly 9 percent overall, according to the National Retail Federation. Furthermore, returns are three times more common for purchases made online compared to brick-and-mortar outlets, reaching $19.4 billion during last year’s holiday season. Since online purchases continue to account for an ever-higher proportion of overall retail sales, the irrefutable fact is that retailers face more returns than ever. To add pressure, returns on purchases made online, according to a recent study from UPS Pulse, also attract the lowest satisfaction amongst customers.

Online retail sales recently passed a significant tipping point. For the first time ever, shoppers in the June 2016 UPS Pulse survey stated that, on average, just over half of their purchases in the three months preceding the survey were made online. Some 62 percent are both researching purchases and making orders purely online (as opposed to the 38 percent who research or buy in-store). The time and place they’re likely to place orders is shifting, too, with smartphone sales accounting for 25 percent of the expected purchases made by people who predicted they would buy more in the future.

Buying habits are set to continue in this direction, with a recent survey by e-tailing software vendor Big Commerce showing that 67 percent of millennials and 56 percent of Gen Xers prefer to search and purchase on e-commerce sites rather than in-store, compared to only 41 percent of baby boomers and 28 percent of seniors.

When customers are increasingly clicking the buy button from their smartphone instead of walking into the store, it’s easy to let the importance of human interaction slide. However, consumers are more informed and demanding than ever. Given their preference for online shopping, it makes sense that millennials and Gen Xers would also spend nearly 50 percent more time shopping online each week (six hours) than their older counterparts (four hours). The profile emerging of the typical online shopper is of someone who knows how to strategically shop across channels, selecting products and retailers with agility. She expects fast shipping or to have a product delivered direct to a store for pickup, and she wants equally easy options when returning goods. Because of these shifts in shopper habits, retailers face not only more returns, but changes in how those returns will be made. Many items purchased online get returned in-store, for example, placing an extra burden on store staff.

And yet, most retailers tend to focus on getting the right product to the customer in the shortest time and with the greatest amount of convenience, with returns little more than an afterthought. Now, more than ever, taking a proactive approach to improving the process for handling a rising tide of returns is absolutely critical to expanding revenue and keeping up brand reputation.

That’s easier said than done, however. Retailers face daunting challenges when it comes to making sure peak season returns result in positive reviews and returning shoppers.

One obvious challenge is staffing. Normally, retailers need to increase their customer service teams significantly in order to manage spikes in orders (and therefore returns) around Black Friday and the holiday season in general. These people are, in essence, your brand advocates. Each interaction supported in a contact center is a reflection upon the brand. The impact an associate has on a customer and his/her perception of a brand stretches well beyond customer care. However, finding new talent with the proper skills, culture and attributes can be a challenge for any organization.

Even when you find the right people to staff call centers, it’s crucial to make sure they know your merchandise. With the peak season bringing in so many associates who are new to any given range of products, it's a challenge to maintain a high level of customer care quality. In some cases, seasonal associates may only be needed in their roles for three weeks or four weeks, and yet they need to absorb the culture of the brand they're serving and achieve a superior level of engagement with the customer. All this leads to a stressed environment that’s often devoid of fun. And yet, smart retailers know that maintaining a fun work environment when faced with busier days and a lot of new faces is a key aspect to having a great peak season.

Here are some guidelines for ensuring you're offering the best experience to returns customers:

1. Get a jump on hiring the best staff available, whether in-store or at the call center. Your HR department should be putting sourcing, recruiting and staff onboarding processes into place early. Good workers tend to get snapped up around the peak season in areas where retailers operate stores and call centers. If you wait too long, your local marketplace may be tapped out, and you’ll struggle to find the quality or quantity of staff you need. It’s worth spending the money to bring new talent on early and to give them as much experience as possible in the “seat” before the busy season really kicks in.

2. Pay attention to which associates are notably going the extra mile to serve returns customers well, and build a hiring database so you can invite them back each year. This is a great way to ensure the cost of recruiting decreases while the quality of performance increases — a win-win for everyone.

3. Make it fun. Inject a sense of fun into recruitment and training. From the moment a potential employee encounters your company, they should be assured that their tasks will be infused with a sense of purpose and enjoyment. Training should encourage a feeling of excitement, and management should ensure that there's room for appropriate personal expression when it comes to dealing with customers. Peak season is short. If you lose associates during training, you may find yourself unable to make up the shortfall.

4. Consider other novel returns processes. Innovations entering the marketplace lately include offering a discount to customers who are willing to opt out of returns. More traditionally, including return slips directly in packaging and equipping call centers to field questions about even the most sophisticated products really do make a difference.

5. Figure out how to move a returned item quickly back out the door. Often, retailers have great systems for delivering products in the first place, but throw returns into a graveyard. Treating returns as if they were original items for sale, and applying the same fulfillment techniques to them is a good start. That will, in turn, reduce the amount of returned products that flow to the secondary market, where they inevitably lose value.

To summarize, while retailers must consider the entire reverse supply chain, perhaps the most important aspect is recognizing the importance of training and retaining great customer care staff who can efficiently and enthusiastically handle an ever-increasing number of returns.

Carle Henry is the vice president of contact centers at SpeedCommerce, a provider of fulfillment, logistics and customer care solutions.