Returns. They eat away at your profit margins and eviscerate your conversion rates. According to Statista, return deliveries will cost online retailers more than $500 billion by 2020. And that doesn’t factor in restocking expenses or inventory losses.
But did you know a well-executed ecommerce return policy can actually drive sales and strengthen customer loyalty? That’s because paying attention to your customers’ after-buying experience pays off. According to comScore, 63% of consumers say they actually take the time to read a return policy before deciding whether or not to make a purchase at an online store.
If customers are taking the time to read your return policy, make sure it lives up to the hype. Use our easy to follow return policy checklist to craft one that is detailed and jargon-free:
1. USE PLAIN LANGUAGE
Plain language is communication your audience can understand the first time they read or hear it. When writing your return policy, use:
- “You” and other pronouns
- Active voice
- Short sentences
- Common, everyday words
- Easy-to-read design features (like itemized lists and short paragraphs)
2. SPECIFY A TIMEFRAME FOR RETURNS
Let your customers know how long they have to return a product. Keep in mind that a longer return period increases confidence in your customers and the likelihood of a sale.
3. SET CONDITIONS FOR RETURNS
Because of the intangible nature of online shopping, ecommerce stores get more returns than brick-and-mortars. Some common reasons for returns include:
- A product that was damaged in shipping, or the wrong item was shipped
- A customer purchased the wrong thing
- Gift returns or exchanges
- The product didn’t match the description
But there are also customers who engage in “wardrobing.” That’s when someone buys an item, uses it, and then attempts to return it for a full refund.
Protect yourself from wardrobers by clearly defining the condition a product must be in before a return can be processed. It’s the easiest way to avoid getting stuck with merchandise you can’t restock.
4. CREDIT OR REFUND?
This is a biggie. Let your customers know if you offer full refunds or just in-store credit.
We recommend offering your customers full refunds on returned merchandise that meets your conditions for returns. Shoppers prefer having options for returning products. If you only offer in-store credit, you risk losing a sale before your customers even commit.
5. SHOW FEES & SHIPPING COSTS
Will your customer have to pay for shipping if they return an item? Will they be charged a restocking fee? Be upfront about what it will cost customers to return your products, or you’ll face consumer backlash later.
6. THINK INTERNATIONALLY
Do you have a return policy for international orders? Make sure to provide clear instructions on where returns should be shipped, and how items will be refunded, including shipping fees for preference-based returns. Will refund amounts be credited in the same currency and using the same exchange rate as the original tender?
If you are an international ecommerce selling globally, make sure to include these details.
7. MAKE IT VISIBLE
Your policy won’t matter if your customers can’t find it. Feature a direct link to your return policy on the footer your ecommerce homepage, or make it a part of your checkout process.
We also recommend including a printed copy of your return policy inside every package you ship and inside your email confirmation to customers.
When it comes to your ecommerce return policy, don’t skimp on the details or fill it with legalese. Be upfront with your customers about how you handle returns. You’ll save yourself headaches down the line and, if you offer a generous return policy, be rewarded with more sales.
Reverse logistics management is an important factor for success in ecommerce - perhaps more than you may realize. To help paint a picture of all the different ways reverse logistics impacts businesses and their customers, we'll take a look at some fascinating data points from around the web and examine their importance in developing broad logistics strategies.
Stat: Ecommerce purchases are 3x more likely than retail purchases to be returned (USPS)
Takeaway: It’s all too easy to let outbound logistics absorb all your focus, but remember: the more you ship, the more returns you’ll have to process (statistically speaking). Plus, because they are such a significant aspect of ecommerce, returns are also a major component of the customer experience your business becomes known for. Streamlining your management processes for reverse logistics today will help you (and your customers) save time and money as the number of returns you process inevitably grows alongside your sales.
Stat: 20% of ecommerce returns occur because of shipping damage (Invesp)
Takeaway: Considering that the cost to replace a damaged product can be 17x the original cost to ship it, ecommerce companies would be wise to prevent those losses by modifying their approach to reverse logistics. Customizing your packaging to an optimal size and level of protection can be simple yet effective change that gets better DIM shipping rates, improves return rates for damaged products, and generates less packaging waste for a cleaner environment. And speaking of reverse logistics and the environment…
Stat: About 5 billion pounds of returned merchandise ends up in landfills (Retail Dive)
Takeaway: That’s a huge amount of waste – and it doesn’t even include waste from excess packaging materials or the fuel spent trucking products from fulfillment center to customer, then back to the fulfillment center and off to the dump. If you want your business to be more eco-friendly, sustainable, and profitable, think about ways you could be recouping costs from returns or donating them.
Stat: 58% of shoppers say they are “increasingly not satisfied” with the ease of making returns. 72% of shoppers are willing to spend more per order, and order more frequently, from online stores with a customer-friendly returns process (Shopify)
Takeaway: As the saying goes: “The customer is always right.” Optimizing your reverse logistics has the potential to do wonders for your brand reputation and customer trust levels.
A smooth returns process is an important factor in the long-term retention of customers. By easily accepting returns, you’re showing shoppers that you stand behind your products, that you’re willing to fix any issues that cause returns, and that you value customer satisfaction. Turn your return policy into a selling point by using these tips to optimize your product return process.
Take some burden off the customer
Look for opportunities to reduce the onus on your customers for returning products. For example, you could include a return packing slip with instructions in all orders and/or ship products in re-sealable packaging.
Use automated emails to keep customers up to date about the status of their return. This not only keeps customers informed, but it’s a marketing opportunity too; you can use these emails to include alternate product suggestions.
Adopt more lenient policies
Streamline your product return requirements to give customers a hassle-free experience. If possible, eliminate hurdles like strict cutoff dates or requiring that returns are unopened.
Recover associated costs
While implementing the above suggestions may cost you more, returns don’t always have to translate into losses for ecommerce businesses. "Store credit" is a classic example – it encourages repeat business and the value of future orders often exceeds the amount of store credit. If you're worried that your shoppers will be dissatisfied with getting credit instead of a refund, consider offering 110% of the original purchase price back as store credit for returns. Another great way to recoup costs is to hold periodic “opened box sales.” Mark down items and/or refurbish them, and you’ll be able to sell off what would otherwise be unwanted merchandise.
When it comes to returns, you want to make them as easy as possible for your customers. Over the long term, it can be good for your bottom line as you build a strong reputation among users. However, the short term could prove difficult. Last year, returned stock, overstocks, and out-of-stocks cost the retail industry almost 2 trillion dollars. Luckily, returns don’t always have to translate into a loss for ecommerce sites. Here are some ways you can salvage sales while keeping customers happy. More...
If you find your ecommerce sales dragging, a new promotion or program is a great way to get your products moving again or stand out from the competition. To come up with a promotion that works for your situation, you should consider the makeup of your customer base, your products, and the logistics of your company. To help you come up with a great promotion, let’s look at some unique programs from a few well-known e-tailers. More...