What Are the Main Reasons for Ecommerce Returns?
Managed improperly returns can become a plague for any ecommerce retailer by having to spend more on reverse logistics, increased work for warehouse employees and lost profits. Returns don’t have to be an inevitable loss and all doom and gloom though. Recent studies find that a good return policy can actually make you money in the long run, if you play your cards right .
Retailers should seek the reason for the return and then use this information to create the opportunity for a second-chance sale during the returns process.
The total rate of returns for 2021 was 16.6% up from 10.6% in 2020 according to the National Retail Federation. With such a large amount of goods being returned across all product types, companies from electronics, clothing, home goods etc. can quickly begin suffering losses while not reconverting customers who are making returns.
In this article we will cover some of the most common reasons for online returns which you can apply to your own businesses experiences to identify ways to improve return policy and limit losses.
Most Common Reasons People Return Purchases
Focusing on these common reasons for ecommerce returns and how to remedy them will help you improve your return policy and limit return losses. Different industries and brands will have various reasons for returning products, but these are the most common reasons across the board:
➡️ Customer ordered wrong product or size: 49% of shoppers return their purchases because they did not match the product description. Accurate, easy to understand product descriptions, separate sizing charts for each designer and item and well taken photos can help limit customers from purchasing the wrong product or size.
You shouldn’t assume product descriptions are static. Maintain current descriptions based on customer feedback and trending search terms.
➡️ Merchant shipped the wrong product or size: 23% of returns are due to the wrong item being received. Organization, the use of ecommerce sales and shipping software and being diligent with each order will prevent the wrong item or size being shipped to a customer.
➡️ The product was damaged or defective: On average a package is dropped a surprising 17 times en route to its destination. Sometimes you do everything right, but the item still is returned because it was damaged during transit or defective. Insuring your products with shipping insurance will help negate these losses.
➡️ The product arrived too late: Keeping your customer up to date on their orders shipment at every turn with post purchase text messages such as Action Alerts will help them understand what is happening and provide a little more patience. Ensuring that your warehouse is working quickly and efficiently during the packing process is also vital. Once the item leaves your warehouse and is in the hands of the carrier you are at their mercy. Typically, reputable companies like UPS and FedEx tend to deliver within a reasonable timeframe.
➡️ The customer no longer needed the product: This situation is almost unavoidable, but through post-purchase text messages you can take this opportunity to cross-sell with related products to offset the return loss. Returning customers are likely to spend three times more over their lifetime than one-time shoppers proving the importance of customer loyalty.
➡️ The customer bracketed their purchases: Bracketing is the process of purchasing the same item at different sizes and various colors to try on at home and return those that are not needed. This practice increased with the onset of the COVID-19 pandemic and has grown with the rise in popularity of online shopping. Many companies are getting creative in combating bracketing by employing augmented and virtual reality to create virtual dressing rooms so customers can try on items without actually having them in their possession.
Bonus – Consider Free Return Shipping
79% of consumers expect free return shipping for ecommerce retailers, but only 49% provide it. Furthermore, 82% of shoppers admit to checking the return policy before making a purchase online. Offering free returns is not feasible for every online retailer, but there are a few things to consider to decide if it’s an option for you…
➡️ Offer free returns only during certain times of the year such as peak periods like the Christmas shopping season.
➡️ How much does the item cost? If it’s a highly priced item or purchased often, paying for return shipping makes sense.
➡️ Limit free returns to orders that reach a certain price threshold.
➡️ As we went over previously, we provided accurate product descriptions and sizing charts to reduce returns of apparel items.
➡️ Take advantage of an ecommerce shipping solution such as ReadyCloud that will help find you the best pricing from shipping carriers.
➡️ Earn and cultivate customer loyalty by using your free return policy as a marketing tool.
➡️ Add limits to what is returned for free such as only high marginal items.
Ready to improve your returns policy by providing a hassle-free and enjoyable returns experience? Contact us to schedule a demonstration of what ReadyCloud Suite can do for your ecommerce business!
