Serial Returners Need a Serious Solution
E-commerce is a land of high expectations. Customers not only expect but demand high-quality products, speedy delivery, and hassle-free return policies. Large public e-commerce sites have made these the standards to which all other brands must compete.
So what happens to direct-to-consumer (DTC) brands that do everything in-house? They can't do one-day shipping, they can't even do two-day shipping, and handling returns is an operational headache. How do they even the playing field so that they can compete with larger marketplaces?
How Do Serial Returners Hurt Brands?
Let’s say there’s a DTC brand that makes shoes that can walk on water. The company develops the product, makes the shoe, and it does what it says it will. Suddenly, you have some people who don’t like the color or need to try on multiple sizes, and you rapidly get a lot of returns.
A majority of DTC brands are doing their own fulfillment due to personalization options, custom packaging, and a desire to own the brand experience. This means they're the ones dealing with operations and returns. In general, a returns department requires a large, dedicated section of the fulfillment center. A separate full-time staff has to open the boxes, validate the product, check for defects, put it back on the shelf, and get it ready to ship back out. Or, as some companies do, they must offload the returns process to a third-party vendor — a costly arrangement.
So what happens? The result of dealing with serial returners is that businesses shift focus from creating to operations. These businesses aren't operations experts; they’re creatives, inventors, influencers, people that make cool things. Serial returners prevent them from being the brands they envision.
Like most e-commerce issues, the solution for a business built on technology lies in tech as well.
Gather the Data
The first step is data gathering in order to recognize patterns and define what constitutes a “serial returner.” Those data points can then be integrated into machine learning and artificial intelligence platforms. In turn, these are used to create a rating system for the customer.
Ratings Go Both Ways
Much like ride-sharing companies where the driver and the rider are both scored, brands now have customer ratings. Serial returning will be one of the factors that affects a customer’s rating.
For example, Brand X can decide to simply not show its inventory to a consumer with a rating below its standards. It’s not a slap on the wrist; it’s a passive method that allows a brand to hide its inventory from a customer who’s infamously known as a serial returner, thereby protecting themselves from a loss in profits.
It All Benefits the Customer
Imagine the shoe company wants to evolve and invent shoes that can make you fly. It only started with the walk-on-water model, when, all of a sudden, it began receiving a bunch of returns due to color and size. The company’s goal is now put on hold because instead of focusing its attention toward innovation, it's dealing with the gruesome hiring process to bring returns experts and operational hands to manage the returned inventory.
Giving brands a tool to prevent serial returners means they don't need to focus on returns, and can instead concentrate efforts on their evolution. When brands have solutions to their unique operational headaches, their development, growth and creativity benefit consumers. Ultimately, the consumer gets the experience and products that meet and exceed their expectations.
Julian Kahlon is founder and CEO of Project Verte, a full-circle e-commerce solution.