Reaping an ROI on Returns

Although they may be a hassle and a pain for retailers, returns are an indispensable part of doing business online. However, they also offer valuable marketing opportunities. If retailers remove the pain points of returns for their customers and take advantage of technology and digital communication, they can strengthen loyalty that translates into more sales.

Brands that are willing to meet and even exceed their customers’ expectations for returns will realize their own form of return in increased customer loyalty. This upshot of returns is consistent with the report from retail CX platform Narvar, “Making Returns a Competitive Advantage.” It declares, “Returns are the new normal”.

If you had told me 20 years ago that I’d be ordering shoes online one day, I would not have believed it. But now I can’t remember exactly when I last bought a pair in the store. Technology has changed the way I shop. It is just much easier to check out what’s available in my size in the style and color of my choice with full transparency than to going from store to store to see what’s in stock.

But even with all the data available for me to make an informed decision, I would not make the purchase if I thought I’d end up stuck with something that doesn’t work.  Like 49 percent of the shoppers surveyed in the report, I check the return policy before making my purchase.

Online shoppers expect returns to be built into the experience, as they have to purchase just to try on. That’s why they demand not just free shipping but free and but easy returns. Nearly half (47 percent) say they find store returns easiest. When that is not possible, as it is in the case of online sellers with no connections to stores, the sellers usually have to not just offer free return shipping labels, but a process that is as painless and anxiety-free as possible.

I recently made a return to ASOS, using the seller’s enclosed prepaid postage label. I was somewhat concerned that the $300-plus worth of merchandise could get lost in transit (having had some negative experiences with packages I’ve sent through the mail in the past) and asked the postmaster about purchasing insurance. He said that was not possible but the label indicated that the retailer was using its own service to take care of everything.

As I found out, that was the case, and the data that the retailer picks up from the post office scan of the label lets it know who is making the return even before the package arrives. That enables it to reassure the customer with a nicely crafted email:

That was followed two days later by the email that said it had the return, identifying all the items with the pictures and telling me how much was refunded.

There is always some element of uncertainty when something is in transit and that can give rise to customer anxiety.  ASOS’s communication here is not just addressing the anxiety that 29 percent of customers surveyed feel about the possibility of their returns going awry but also turns the necessity of reassurance into a positive communication experience between seller and customer. In that way its action serve as proof of the brand image it wishes to convey that it is made up of “a friendly, helpful bunch.”

Why wouldn’t I want to give ASOS my business again, when it not only removes the pain of returns, but adds this friendly touch? My response is very much the norm. According to the report, 95 percent of shoppers return to buy from the seller that provided them with a good return experience.  In contrast, those who were not happy with the experience were three times more likely to abandon a brand.

What emerges is that retailers have to see the marketing opportunities inherent in returns. That consists not just in making the process as easy as possible for the customer but in offering helpful and friendly updates to let them know what’s happening and that you care about their concerns.  Tapping into technology makes it possible to automate those digital updates that foster feelings of loyalty. The result is happy returns, for both the buyer and seller. 

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