rns in Ecommerce: What to do by 2024?
How often have you heard that “Returns are a part of e-commerce?”
This phrase will take on new significance as 2024 approaches. Mastercard predicts that retail ecommerce returns will increase by 5.9% over the past year.
This might appear to be a barrier for ecommerce businesses. Don’t worry, as an increase in profits is an opportunity to innovate and improve.
This article will highlight the best practices that you can employ to reduce and tackle customer returns. You’ll also learn the average return rate for ecommerce and which software is best to handle this process.
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Returns are important in ecommerce.
Online shopping is all about returns. Customers are more loyal to a store that offers a flexible and easy return policy. A complicated or strict policy of return may decrease the lifetime value of a customer.
What is an ecommerce refund?
Customers have 30-60 days to return purchases in ecommerce. This allows them to decide whether they want to keep the item or return it.
Why do consumers return items?
PowerReviews surveyed consumers to determine the reasons for returning online purchases. Eighty-one per cent of respondents said that they returned the product because it was damaged or defective. Other people cited:
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The item doesn’t fit (75%
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Item doesn’t match description (56%)
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Product(s) not to your liking (33%)
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Multiple items/sizes ordered (14%)
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Product delivered late (11%)
What is the average return percentage for online shopping?
The average return rate for e-commerce is between 20-30%. The exact percentage can vary depending on the factors such as the type of product sold, the clarity in the product description, and the ease with which the customer is able to shop.
The best software to streamline ecommerce returns
There are many apps that will make it easier for you to manage returns and exchanges if you use Shopify as your ecommerce platform.
The apps can help you with everything, from tracking orders to getting products shipped. They also create return labels and offer incentives for customers to exchange their items.
Here is a list of some of the most common ones.
1. AfterShip Returns
AfterShip returns is a ecommerce return management software that’s used by brands such as Watsons, Secretlab and Gymshark. The software streamlines returns with features such as a self service returns page and automatic email updates. These tools reduce customer anxiety and improve post-purchase satisfaction.
AfterShip Returns offers dynamic features like incentivized refunds, exchanges and store credit. This flexibility encourages the customer to continue shopping and turn potential returns into sales opportunities.
The platform’s centralized dashboard, rule-based automation and return management simplifies the process for ecommerce companies.
2. Returns & Exchanges
If you use Shopify for your business, Loop is an excellent tool to manage returns. It encourages customers to exchange their items instead of returning them. They can easily swap out an item with a different color or size by clicking on it.
Loop is unique in that it streamlines and automates the refund process. The app compares the information on the return form with the policies of your store when a customer asks for a refund. It then decides automatically whether or not to approve the refund. Automation speeds up your process while maintaining fairness and consistency in the return procedure.
3. Parcel Panel Returns & Exchange
Parcel Panel is a solution that online retailers can use to deal with international returns. It eliminates one of the most difficult tasks – creating return labels for international shipping.
Strategies for handling ecommerce returns
1. Returns to Your Warehouse
Encourage your customers to return their items to your warehouse. But add a special touch. Consider allowing customers to schedule home pickups for their returns. This convenience–especially for bulky or delicate items–can be a deciding factor for customers choosing your brand.
A second tip is to partner with local businesses as drop-off locations for returns. This strategy will reduce your warehouse’s workload. Your warehouse will not have to deal with individual returns but can handle consolidated shipments coming from local return hubs.
2. Return to brick and mortar outlet
Encourage customers to return products in-store is a great strategy for retailers. Instead of simply accepting returns at the counter consider ways to improve the customer experience.
Set up a Return and Explore area within your store. Customers can use this area to return items and receive assistance from staff. Your staff can recommend new items or trendy products based on customer preferences. This turns a return into a chance to increase total retail sales.
3. Outsource reverse logistics
Outsourcing reverse logistics is a third option that focuses on sustainability. Partnering with companies who can recycle or repurpose returned items is one way to do this. If you sell clothing, for example, partnering up with a company who recycles fabric could be an attractive selling point to environmentally-conscious customers.
You can also find logistics partners that provide detailed analytics about your returns. These data can provide insights into the performance of your products and customer preferences. This will allow you to make informed marketing and inventory decisions.
Ecommerce returns best practices
The key to improving customer satisfaction is handling returns efficiently. What if they could be prevented altogether? This would result in lower costs and greater profit margins, two things that ecommerce merchants most desire.
Here are 5 ecommerce return best practices that will improve your revenue:
1. Keep the product information handy
Make sure that everything you show your customers is accurate and complete. Returns are common when customers receive something that is different than what they were expecting.
Every product page in your online store should include:
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Product weight and size
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What are the materials used
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Size Guides and the Model’s Size for Reference (if this is relevant)
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Your return policies, including the timeframe, costs and products that can be returned
2. Shipping items that are secure
Keep in mind that your work is not done once an item leaves the warehouse. Returns can occur when items are damaged or faulty. While you would never send damaged goods out, sometimes things go wrong in the delivery process.
While your delivery service is important, there are steps you can take to reduce the likelihood of damage or returns.
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Select the correct box size to avoid items moving too much in transit.
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Protect fragile items by wrapping them in protective materials such as bubble wrap.
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Mark boxes that contain breakable items such as glass as “Fragile”.
3. Reviewing your reviews can be a powerful tool
Reviews provide you with real-world feedback on how your product performs. This information can help you make the necessary adjustments or improvements, resulting in fewer unhappy customers and fewer returns.
For maximum effectiveness, let customers provide information such as measurements, material quality and size. Then add filters to these details. It allows shoppers to find reviews by people who are similar to them, which helps them make an informed purchase decision.
4. Size charts and experiences that are dynamic
Returning items such as clothing or shoes because they don’t fit is a common problem. Online, customers are unable to try on items. Customers must read carefully the description, rely on photos, and hope that an item fits.
Size guides and fitting tools can be helpful. Size charts can help shoppers choose the right size. When customers know how an item will fit, they are less likely return it.
Use a size chart application to create a dynamic sizing table in your store. Consider using an AR/3D application to show your customers how the products will look on them. This can help them make better size and style decisions and prevent returns.
5. Keep your customers informed
How you are perceived and discussed is important for online shops. One social media post could influence someone to purchase from your store or your competitor. Do you want your return process to be more about your customers, or for your business? When in doubt, always put the customer’s needs first.
Tips for
Inform your customers of their return via email or better yet, Facebook Messenger or SMS. This could be done automatically by your order management system.
Ask your customers for feedback. Find out what they think of the return process. This feedback can be used to identify areas for improvement.
Select a shipping company that provides parcel tracking. Many shipping partners provide tracking numbers so that customers can track their returns. Send an automated message confirming the return’s arrival once it reaches your warehouse. Let them know the expected refund time.
Protecting your business from ecommerce returns fraud
Did You Know that retailers lose on average $10.30 for each $100 of returned merchandise? This is a serious issue as 13% of retailers suffer losses due to fraudulent returns.
It’s important to understand the different types of returns. Shopify Flow is a great tool. Set up a tracking system based on the order value or frequency of returns to determine return behavior. Apply this data to the following:
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Tag your customers to track them in the future
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Alert your team about suspicious activity
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Disqualify frequent returners for promotions such as free shipping or refunds
There are other strategies to avoid return fraud, including:
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Use delivery carriers who provide proof of delivery
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Offer store credit instead of cash refunds
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Ensure that returned items are accompanied by original tags and receipts
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Refusing free shipping for fraudulent returns
Returns and customer loyalty
Today’s customers expect a smooth return. Even the slightest inconvenience can make them turn away. Rithum’s survey from 2023 shows that about half of respondents avoid returning items if they find the process to be complex.
This trend is a warning to merchants. A complicated return policy can drive customers away from a market that is all about convenience. Some customers will even choose to keep unwanted products in order to avoid hassle.
Consider ways to simplify your return process in order to encourage customer loyalty and keep them coming back. It could be as simple as implementing clear policies and easy-to follow steps. A streamlined return procedure is an investment for customer satisfaction.
Get ready to conquer the ecommerce returns
Now you know how to deal with ecommerce returns.
Remember: Returns will happen despite your best efforts. Focus on creating a memorable experience for them when they return.
The return process is as important as the first contact with your brand.
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