Voice of the Industry

How return policy can negatively affect your business

Friday 18 March 2016 08:17 CET | Editor: Melisande Mual | Voice of the industry

Jelle Schoenmaker, CycleonGood experiences with returning items leads to repeat customers and recommendations for the retailer

Even though technology has made building an ecommerce empire easier than ever, ignoring the fact that buyers need to feel secure and confident in making an online transaction can impede the growth of any business. One of the main areas to focus on are returns. Customers want to instinctively know that if there is an issue with the purchase, they can return it to seek remedy.

Retention drivers

Many shoppers are willing to pay a nominal fee to receive the product faster, if given the option. Shipping and delivery timing is important during check-out – it’s all about communication!

To reduce shopping cart abandonment, retailers should show the shipping costs, present how much more should be purchased to get free shipping, and give consumers the option of shipping time frames. Customers are willing to wait for their packages, but need to know what is happening – they want estimated delivery times clearly stated, and they want e-mail or text alerts about their delivery.

Similar tactics might be applied to returns. Customers want to be sure that if there is something wrong with an ordered item, or if they simply change their mind, they can return it easily without much hassle. Good experiences with returning items leads to repeat customers and recommendations for the retailer.

Good and bad returns experiences

What constitutes a bad returns experience for consumers, besides having to pay for return shipping, is paying a restocking fee and waiting too long for a credit. Some customers have, also, faced issues getting the item to be returned to the shipping company. Attitudes towards returns do not vary substantially by product category, but for some products, such as fashion items, return rates can reach 40%, or even higher; so, having a robust returns strategy in place is crucial. This is especially the case in, for example, Germany, where 51% of customers mentioned that they would come back to the retailer who offers free returns (Forrester Research). By comparison, both the UK and France have far fewer returns, but much more cautious customers. For more information on European return rates, check out The Paypers’ Cross-Border Ecommerce Reports.

Not only must you be aware of, and adhere to, local regulations regarding customs, taxation, and returns, it is also important to be as transparent as possible about these to your customers. Many countries now have mandatory returns policies, and the European Union’s Directive on Consumer Rights aims to make it simpler for companies to do business across the border, by increasing transparency and offering a two-week ‘grace period’ for returns.

When asked directly what aspects they would like retailers to improve, 58% of online shoppers chose free or discounted shipping; however, free shipping is one of the least important factors in overall online shopping satisfaction. Ease of returns and exchanges is cited by 42% (ComScore) of online shoppers as an aspect they want to see improved by retailers. Returns are an important part of online shopping, with 63% of customers looking for the returns policy prior to making a purchase. Nearly two-thirds (62%) of online shoppers have returned a product purchased online.

Conclusion

According to a recent report that was published by Forrester Research, approximately 81% of all online customers desire a simplified process for returns management. If you do not offer a convenient and efficient, consumer-friendly returns process, you will not likely be attracting many customers for very long to your online business. Instead, your customers and many prospective shoppers will just take their business somewhere else.

About Jelle Schoenmaker:

In 2007 Jelle joined Cycleon where is responsible for sales, market development, marketing and customer service. His strong managerial and networking capabilities resulted in a strong growth of the Cycleon business and service portfolio. Now that Cycleon is expanding into Asia, Jelle’s experience in the logistics market for Electronics, E-commerce and Printing & Imaging will contribute to further growth.

About Cycleon:

Cycleon is an international Supply Chain and Service Integrator supported by a state-of-the-art Reverse Logistics platform. The company reduces the complexity of reverse logistics and has a proven track record in developing and executing optimized end-to-end returns solutions. For the clients this drives improved customer satisfaction and experience. Cycleon offers international reverse logistics solutions in over 40 countries, that meet changing needs in service, customer behaviour and legal requirements. With its sister company Cycleon-recare we can now offer a range of repair, refurbish and reselling services from 3 sites in the UK, Romania and Czech Republic. Cycleon is part of the Reverse Logistics Group offering services globally


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Keywords: Return policy, Jelle Schoenmaker, Cycleon, ecommerce, returns, purchase, checkout, shipping, delivery time, expert opinion
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