A harsh reality facing DTC eCommerce businesses is that customer product returns are an inevitable hassle. And there’s clearly a call for improving the return process. As shoppers continue to buy online, they are also returning a larger portion of purchased items. Consumers returned over $761 billion in merchandise in 2021, which amounts to nearly 16.6% of the total purchased. That’s a sharp increase from the $428 billion in returned merchandise in 2020.
Returns are costly for businesses and frustrating for consumers who demand a smooth post-purchase experience. In fact, 84% of consumers are unlikely to buy again from a brand after a poor return experience. Since shoppers cannot “try it before they buy it,” it’s no wonder customers return 30% of all products ordered online. Lost revenue and lost customers resulting from a poor returns policy is another grim reality for online retailers.
Returns Can Be a Good Thing
The good news is that the customer product returns don’t have to be a headache. A streamlined and transparent returns policy can boost a brand’s credibility and encourage repeat customers. 72% of shoppers will buy again from the brands that offer an easy returns experience. For online retailers, a robust returns policy can lead to positive brand perception and improved customer loyalty.
Let’s look at the nature of customer product returns and how a streamlined returns process can strengthen customer loyalty.
Reasons for Customer Returns
There are many reasons why a customer might return a product they ordered, and some can be quite outlandish. But the majority of returns are legitimate, and they include:
- The customer bought/received the wrong item
- The product was damaged or defective on arrival
- The customer changed their mind once they received the item
- The delivered product looked different from the website
- The size/color was wrong
eCommerce trends also fuel customer returns. A reported 20% of all online returns were due to consumers making multiple purchases. An example is when a customer buys three different sizes of an article of clothing to ensure a proper fit. They will then return the two that didn’t work out. Frivolous consumer trends like drunk shopping and “wardrobing” also contribute to higher instances of online returns
How Returns Affect Customer Loyalty
Today’s busy online shoppers expect the returns process to be as seamless and frictionless as the purchase journey. The return process is so important that 67% of online customers check a brand’s return policy before purchasing. And, 92% will buy from a brand again if the return process is easy. These stats point to one thing: the return process strongly impacts customer loyalty and by extension, the bottom line. As a result, online retailers need to ensure their returns policies match customer expectations.
How to Improve the Returns Experience
High customer product return rates don’t need to harm the overall customer experience. In fact, the right return policy can encourage repeat purchases and earn customer loyalty. By reducing friction in the post-purchase experience, brands can turn a negative into a positive. Here are some tips on improving the return process and earning customer loyalty.
Offer free returns
Free returns may seem logical for brands that want to boost customer loyalty. Yet, online companies are often hesitant to offer them. Yes, free returns have disadvantages. Namely, they’re costly and can lead to waste, higher prices and a loss of profits. On the other hand, offering free returns reduces barriers to making purchases. Since 69% of shoppers will not buy from brands that charge for returns, brands need to invest in free returns.
Specify a time frame for returns
62% of customers expect an exchange or refund within 30 days of purchase. Letting customers know exactly how long they have to return a product is crucial in a return policy. Typically, eCommerce stores offer a 15 to 30-day window in which customers can return a product. Some businesses extend that period up to 90 days or more. Extending the time period on returns can add goodwill to the post-purchase experience.
Make the returns policy easy to find
66% of customers will review a brand’s returns policy before completing a purchase. Whether in the FAQ section or a separate web page, a brand’s return guidelines should be easy to find. Prominent links should direct customers to the returns section in both desktop and mobile versions of a brand’s site. Adding a link to the return policy to the checkout page is also a good idea.
Make the returns policy easy to read
Once customers find the returns policy, it should be easy for them to read and understand. Wording should be clear, concise and not open to interpretation. Above all, avoid confusing and dense legalese. A clearly worded returns policy builds customer trust by removing the annoyance of figuring out how to make returns. Less frustration leads to happy customers and increased loyalty and sales.
Offer cash or credit refunds over exchanges
Consumers don’t want to be locked into an exchange if they are unhappy with their order. Customers are more likely to buy again from brands that offer cash or credit refunds instead of a straight exchange. Surveys show 59% of consumers consider a full refund the most important factor of a return policy. To ensure customer loyalty and retention, brands should give the customers what they want.
Enacting robust customer product return policies offers DTC eCommerce brands an opportunity to reduce costs, boost sales and increase customer loyalty. An efficient returns policy can help deliver an overall positive shopping experience that makes customers want to come back. Since maintaining customer loyalty is more important than ever, an excellent returns experience can convert lost sales into loyal customers.
With Scalefast working as your Merchant of Record for your DTC eCommerce store, customer product returns will no longer be a headache. We’ll handle all customer service issues so you won’t have to. Need more info? Contact one of our eCommerce experts or schedule a demo today.