The Future of Online Shopping: How Ecommerce Returns in 2023 Will Impact Your Business
If you’re selling online, you’re going to also have to return online. For years, we’ve covered ecommerce returns to help you improve your business model. In today’s blog, we’ll discuss the current state of ecommerce returns, the future of ecommerce returns in 2023, and how your business can prepare for these changes to stay on course for this year and beyond. Read on to learn more.
The State of Ecommerce
Ecommerce has revolutionized the way we shop, offering convenience and accessibility that traditional brick-and-mortar stores cannot match. However, with the growth of online shopping comes the issue of ecommerce returns. In 2023, ecommerce returns are expected to become a major challenge for businesses, with estimates showing that the value of online returns will reach $550 billion.
How Returns Impact Business
Currently, ecommerce returns are a significant issue for businesses. According to industry research, the average return rate for ecommerce purchases is around 35%, compared to just 8.89% for brick-and-mortar stores. This is due in part to the fact that customers cannot physically touch or try on products before purchasing them online. As a result, many customers order multiple sizes or variations of a product, with the intention of returning the unwanted items.
Ecommerce returns have a significant impact on businesses, causing lost revenue, increased operational costs, and reduced customer satisfaction. In addition, returns can create logistical challenges, as businesses must manage the process of receiving, inspecting, and restocking returned items.
The Future of Ecommerce Returns in 2023
Looking ahead to 2023, ecommerce returns are expected to become an even bigger challenge for businesses, with most experts predicting that returns will double this year and beyond. As ecommerce continues to grow, so will the number of returns. In addition, customers will likely become more demanding in terms of returns policies and procedures, with expectations for faster and more convenient returns processes.
The rise of new technologies such as augmented reality and virtual try-on will also impact ecommerce returns. While these technologies can help reduce the number of returns by allowing customers to better visualize products before purchasing, they can also create new challenges in terms of returns management.
Medium businesses are particularly vulnerable to the impact of ecommerce returns. These businesses often lack the resources and infrastructure of larger companies, making it more difficult to manage the logistics of returns. What’s more, medium businesses may face greater financial risks from returns, as the costs of restocking and reselling returned items can be significant.
The good news is that medium businesses can also benefit from developing a strong returns policy that meets customer expectations. By offering flexible and convenient returns options, small businesses can differentiate themselves from larger competitors and build customer loyalty.
Best Practices for Managing Ecommerce Returns
To prepare for the future of ecommerce returns, businesses should focus on developing a comprehensive returns strategy. This strategy should include clear policies and guidelines for returns, as well as a streamlined process for receiving and processing returns.
Businesses should invest in technology and infrastructure that can support efficient returns management. This may include software for tracking and analyzing returns data, as well as specialized equipment for inspecting and restocking returned items.
Effective returns management requires a range of best practices, including:
- Clear and transparent returns policies
- Easy-to-use returns processes for customers
- Efficient returns processing and restocking procedures
- Regular analysis of returns data to identify trends and opportunities for improvement
- Open communication with customers to address any issues or concerns
The Role of Technology
Technology will play a key role in the future of ecommerce returns. New innovations such as blockchain and artificial intelligence will enable more efficient and secure returns processes, while augmented reality and virtual try-on can help reduce the need for returns altogether.
However, businesses must also be mindful of the potential risks and challenges associated with new technologies. For example, blockchain-based returns management may require significant investments in infrastructure and training, while virtual try-on may not be suitable for all product categories.
To reduce the number of ecommerce returns, businesses can explore a range of innovative solutions. For example, some companies are experimenting with predictive analytics to identify customers who are likely to return items, and offer them targeted incentives to keep the product.
Others are using chatbots and other AI-powered tools to improve the customer experience, providing personalized recommendations and assistance to help customers find the right product the first time. By reducing the need for returns, businesses can save money and improve customer satisfaction.
Creating a Winning Policy
Developing a strong returns policy is a critical part of effective returns management. Your policy should be clear and transparent, outlining the conditions under which returns are accepted, as well as the process for returning items.
Furthermore, your policy should be flexible and customer-centric, offering a range of returns options to meet the needs of different customers. This may include options for in-store returns, free return shipping, and extended return periods.
As ecommerce continues to grow, businesses must be prepared for the challenges and opportunities of ecommerce returns. By developing a comprehensive returns strategy, investing in technology and infrastructure, and exploring innovative solutions for reducing returns, businesses can position themselves for success in the years ahead.
I leave you with this illustrated infographic that you can use to learn more about ecommerce returns and the staggering statistics associated with them for 2023. Feel free to share it on your own blog and social channels!