The era of eCommerce has brought incredible convenience to consumers. They can order anything with the click of a button, right from the comfort of their homes. However, alongside the surge in online shopping, eCommerce retailers have seen a parallel increase in product returns, with rates reaching as high as 30%.
This substantial rise in returns presents a challenge for retailers, as they’re often time-consuming, and reverse logistics can be costly. However, the ability to return products that fail to meet customer expectations remains a highly influential draw in online shopping.
By effectively managing the returns process, you can not only mitigate costs but also enhance the efficiency of reverse logistics, which contributes to customer satisfaction and retention. Here are seven practical tips to streamline your returns process and satisfy new and returning consumers alike.
The importance of a clear return policy
A return policy is a set of rules that outlines the terms and conditions under which a customer can return a purchased product.
In eCommerce, an explicit return policy is paramount. It serves as a security blanket for shoppers, assuring them they can return a purchase under specific conditions if the product doesn’t meet their expectations.
Your return policy must address key questions like:
- How long does the customer have to return the product?
- Under what conditions can the product be returned?
- What is the method of refund (i.e. a cash refund, store credit, or product exchange)?
Answering these questions ensures your return policy is transparent and comprehensive. It reduces ambiguity for the buyer, builds trust, and can significantly impact your sales and customer retention.
Shoppers who understand your return policy are more likely to have confidence in their purchases and less likely to leave negative reviews due to unexpected issues with returns.
How to streamline your return process
You can implement several key strategies to transform your return process from a potential headache into an asset:
1. Make your return policy easy to understand
Use clear, simple language to ensure customers understand your return policy. Avoid legal jargon and complex terms as much as possible. When the return policy is easy to comprehend, it reduces confusion and enhances customer trust, which encourages buying decisions.
A comprehensive and understandable return policy can significantly enhance consumer satisfaction. It shows them you value their experience and aim to make the buying process as transparent as possible. This increases customer loyalty, repeat purchases, and positive word-of-mouth advertising for your brand.
Consider including a FAQ section or a step-by-step guide illustrating the return process. These tools help buyers visualize the process and know what to expect at each stage.
For more ideas, check out How to Write a Killer Return and Refund Policy.
2. Display your return policy prominently
Where you place your return policy matters. Ensure it’s not hidden in some corner of your website.
Your policy should be easily accessible at all stages of the customer journey, not just at checkout. Consider including links to your return policy on your product pages, shopping cart overviews, and even in your marketing emails.
3. Offer a seamless return procedure
The actual process of returning an item can greatly impact a customer’s perception of your business. A smooth, hassle-free procedure can improve their experience and is a crucial factor in determining whether a customer will shop with you again. Aim to make the return process as straightforward as possible.
Remember, automation is your ally. By automating returns, you can reduce manual errors and expedite the process for greater customer satisfaction. Automated returns systems can generate return labels, track a product’s status, and update inventory levels.
Multiple returns results in a negative shift in customer behavior: 42% of customers will no longer shop with that particular retailer, while a whopping 72% are likely to express their dissatisfaction through a poor review.
In that regard, simplicity is key. A return process with too many steps can deter shoppers. Streamlining the process and limiting the steps required to send a product back will smooth the customer experience and increase the likelihood of them doing business with you again.
4. Provide multiple return options
Customers have varying preferences and circumstances. Some like to send back products by mail, while others find it more convenient to return them in stores.
By offering multiple return options, such as in-store, postal mail, and pick-up services, you can cater to these differing demands and enrich the buyer experience. This flexibility is an added layer of customer service that can distinguish your business from competitors.
Beyond accommodating consumer preferences, providing multiple return options can be a more sustainable choice.
For example, in-store returns eliminate the need for shipping, which reduces carbon emissions. Additionally, it allows the customer to browse your store and make extra, unintended purchases, serving to offset the money lost from the returned item (and potentially boost profits elsewhere).
5. Efficiently manage returned inventory
Once you receive a product from a customer, you must appropriately handle and reintegrate it into your inventory. Properly managing returned items is crucial to maintain inventory accuracy, mitigate financial losses, and identify recurring product issues.
Consider partnering with a reverse logistics provider like MyFPAPrep. They provide a comprehensive suite of services designed to streamline inventory management, including efficiently handling returns. Their reverse logistics services assist businesses in managing, processing, and repurposing returned inventory to minimize losses and maximize value.
To develop a well-oiled returns procedure, consider implementing strategies such as:
- Fast restocking: The quicker a returned item is restocked, the faster it can be resold. That reduces holding costs and potential losses from depreciation or obsolescence. Efficient restocking requires a seamless process to receive, inspect, and reintegrate the returned items into your inventory.
- Appropriate product disposition: Not all returned items can or should be resold. Depending on the product’s condition, it may be more cost-effective to refurbish, recycle, donate, or even dispose of the item. It’s crucial to assess each returned product and decide on the most appropriate course of action.
- Leveraging secondary markets: Consider using secondary markets for items that can’t be resold through your primary channels. These could include discount outlets, online marketplaces, or liquidation companies. Selling returned items through these channels helps you recoup some of your losses.
6. Encourage gift cards
Another smart method to handle returns, especially those given as gifts, is to offer gift cards instead of cash refunds. This form of store credit keeps the money within your business and encourages future purchases. That can be beneficial when gift-related returns are high during the holiday season.
Remember, the goal isn’t just to process the return but to retain the customer and encourage repeat business.
7. Analyze return data to improve your operations
Reviewing the numbers for your returns helps identify trends, issues, and areas of your operation that need improvement. Return data can reveal patterns that are causing a high volume of items sent back. For example, a product might have a manufacturing defect or a misleading description.
Once you’ve identified these problems, you can make necessary changes to reduce the instances of future returns. In turn, that continual improvement can cut returns and increase both customer satisfaction and operational efficiency.
Consider adopting software tools like Loop or Narvar to track and analyze return data. These tools provide reports and visualizations to help you understand return patterns and trends. They also offer predictive insights to help you anticipate and manage future return activity.
Streamline returns for greater customer satisfaction and business success
Dealing with product returns is inevitable in eCommerce. However, a well-managed process can turn this challenge into a profitable opportunity.
By creating a clear and easily accessible return policy, offering multiple return options, and efficiently managing returned inventory, you’ll enhance the buyer experience and build stronger relationships with your customers. Also, leverage the data on items sent back to improve your operations and lower the financial impact of returns.
So, rather than accepting the loss, transform it into alternative gains. With the seven tips we’ve provided, you can streamline your return process, improve customer satisfaction, and drive greater business success.
Rachel Go is the marketing director of MyFBAPrep, an eCommerce warehouse network for Amazon aggregators, enterprise brands, and top Amazon sellers. Operating a global network of more than 100 warehouses and 85-million-square-feet of operating warehouse space, MyFBAPrep offers a full suite of ecommerce 3PL services including Amazon wholesale and private label, direct-to-consumer (DTC) fulfillment, and B2B retail. Powered by its SaaS technology platform Preptopia™, sellers get access to unified billing, analytics, business intelligence reporting tools and real-time inventory views across multiple warehouses in the network.
The company provides FBA Prep automation, modern robotics item picking, and a dedicated account management team. Based in Coral Springs, Florida, MyFBAPrep moves over $1 billion in Gross Merchandise Value (GMV) and processes over 10-million units annually.