Product Returns: A New Moment of Truth

Despite seeing record sales revenue recently, there’s a concerning trend in online retail that could seriously impact future growth and success for merchants. Last year, nearly two-thirds of global consumers (61 percent) felt let down by their online shopping experience, up from 47 percent in 2017. This is an enormous percentage of unhappy customers that simply can’t be ignored.

So what can retailers do to boost happiness and increase loyalty with online shoppers? Show customers you care beyond the sale.

Over the past two decades, retailers have invested a lot of time, effort and money in creating the ultimate shopping experience, but post-purchase has mostly been an afterthought. Returns are arguably the most critical — yet most difficult — part of the customer journey, and can have a massive impact on a retailer’s bottom line. Shoppers are expected to spend $600 billion online this year, and return rates that can reach 30 percent for online purchases create a potential for $180 billion in returns in the U.S. alone.

If a customer feels ignored and undervalued post-purchase, companies run the risk of suffering from significant damage to the brand. In fact, 90 percent of online shoppers in the U.S. will take an action that can damage a retailer’s brand in response to a poor post-purchase experience.

Here are a few ways retailers can transform product returns into an amazing customer experience.

Minimize Concerns Upfront

A return policy is as much a marketing tool as a retail necessity — think Nordstrom, L.L.Bean, and Zappos. Retailers should have a clearly defined and easy-to-find returns policy that describes how the process works and outlines clear expectations. Clear expectations will put shoppers at ease during the decision-making process, making their path to purchase that much easier.

Invest in Great Return Policies

Shoppers expect free and easy returns. In fact, 49 percent consider them a priority. While it may be no surprise that lenient return policies result in more purchases, recent research found that leniency in the right areas can result in fewer returns, too. Exceeding the expectations of today’s shoppers can often call for policies that push traditional boundaries. Outdoor Voices, a cult-favorite athletic brand, goes above and beyond expectations by offering its best customers an instant credit to shop again so they can “Spend less time waiting, and more time Doing Things.” The result is a powerful and memorable experience that goes beyond basic transaction to delight its shoppers and build loyalty for the brand.

Turn Basic Touchpoints Into Defining Moments

The beginning of each new product return marks the start of a new customer journey with additional touchpoints. Companies like Fanatics use package tracking as an opportunity to extend its brand and create transparency in the return process. Efficient and consistent communication is a critical component of delivering a positive customer experience, but it also means another opportunity to engage with shoppers and to cross-sell, upsell and market additional products. Optimize each shopper touchpoint with personalized messaging based on their past return behavior.

In the age of Amazon.com, and at a time where shoppers are increasingly expressing disappointment with their e-commerce experiences, product returns can no longer be an afterthought. The post-purchase experience has become a moment of truth for shoppers. Exceeding expectations when it matters most will result in happy, hyperloyal customers that frequent your business for years to come.

Eduardo Vilar is the founder and CEO of Returnly, a post-purchase payments platform, and a 4x tech entrepreneur and actuary.