E-Commerce Returns Best Practices

While it’s still a little early to see holiday decorations up at your local mall, retailers are already preparing themselves for the busy holiday season. Every single year during the holidays, sales skyrocket and companies find out if their yearly projections were right on track or off the mark. More and more, however, it means that it’s time to prepare for a busy e-commerce season, too.

E-commerce is growing at a tremendous pace, and outpacing traditional in the process. According to the U.S. Census Bureau, e-commerce grew at an incredible 14% in 2014, while traditional retail only grew by 3.8%. By the end of this year, it’s expected that e-commerce is going to be a $1.5 trillion industry.

But for online retailers, there’s a reason to temper expectations. Because holiday season means returns season.

Online Shopping Season Means Processing Returns

The more online inventory you move, the more returns you’re going to have to deal with. This is especially true during the busy holiday season. On top of dealing with everything from inventory management to having the right packaging programs in place, you now have one more big thing to worry about – managing all those returns.

You’re dealing with more orders than usual, leaving you prone to mistakes. You’re also dealing with gift purchases, which will be returned if they’re not what somebody wanted or something they already own.

Having to deal with these returns can be a hassle, especially when they’re coming in droves. As we’ll discuss next, though, having a streamlined returns process is vital for your business.

The Importance of Making Returns Easy

Offering free and streamlined returns is in the best interest of e-commerce retailers. It also has a huge impact on the bottom line. Research shows that online retailers offering free returns can expect sales to increase between 58% and 357%.

Clearly, the costs of free, streamlined returns are – though not cheap – can be worth it. Here’s a breakdown of exactly why it’s so effective:

  • You’ll attract more customers. One of the biggest reasons many consumers are hesitant to shop online is because returns are much easier with a traditional retailer. Making it free and easy might be just the nudge they need.
  • You’ll sell more. A recent survey found that two out of three online shoppers agreed they would purchase more online if returns were free.
  • You’ll lose fewer sales. A quarter of shoppers surveyed claimed that they would abandon an online purchase if return policies were poor or unavailable.
  • You’ll differentiate yourself. At the start of 2014, only 10% of retailers offered no-cost shipping on returns.

Best Practices For Returns

In order to truly make returns a competitive advantage, you need to give your consumers what they want. Here’s what’s most important to online shoppers when it comes to returns:

  • A return label included in their package, or easy-to-print labels.
  • Return-friendly packaging that is easily re-sealable.
  • Automated refunds.
  • Free return shipping.
  • Simple, clear procedures.
  • The ability to return merchandise to a physical location.

Retailers can also be proactive in reducing returns. Each return costs your business money - especially if you’re offering free return shipping. And no matter how simple the process is, returning merchandise is a hassle.

Items are usually returned because they’re not what the customer expected or they don’t fit. This means that you need to do everything you can to meet expectations. Include lots of HD photos, reviews, and sizing charts. If a particular item fits loose or tight, make sure to include that information.

As you can see, returns are a vital process to the e-commerce sales cycle. If you’re able to streamline your processes – from eliminating errors during packing to packaging optimization to reduce shipping cost, to managing returns – you’ll eliminate as many returns as you can, which in turn will keep your customers and your bottom line happy.


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