Narvar's 2024 State of Returns report is here—get your copy now!
Ditch status-quo, one-size-fits-all returns. → Learn More
Narvar's 2024 State of Returns report is here—get your copy now!
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Retailers love to focus on the first-impression they make with shoppers pre-purchase. While doing so isn’t a bad idea, it does leave retailers vulnerable to making the biggest mistake in retail.
So, what is the biggest mistake in retail, you ask?—It’s simple:
A terrible returns process.
This is especially true in the context of ecommerce. A retailer can operate a beautiful website with exceptional product detail pages, endearing customer testimonials, and a seamless checkout process, but all those positives can be overpowered by a turbulent returns process.
Put another way, if a return goes off the rails, that customer isn’t coming back.
At its core, retail is a simple, contractual process—the customer pays money (valuable consideration) and receives goods in exchange. When retailers extend a return policy to shoppers, they’re offering a legal provision that allows the customer to rescind the contract within a certain time period (or under specific conditions).
In the United States, only 13 states require retailers to notify customers of their return policy in explicit terms. However, because of ecommerce’s universal reach, the policies of those few states are essentially applied across the nation—every retailer engaged in ecommerce must publish their return policy for customers to review.
Consumers who endure a bad returns experience are 3X more likely to abandon the retailer and damage that retailer’s Net Promoter Score. Compare that to the 95% of online shoppers willing to buy again from retailers with a good returns experience.
Those numbers make a huge difference in terms of profitability and growth in retail, especially when you realize:
There is a huge difference between what retailers are required to accept in the way of returns, and the generous return policies that are the industry’s gold standard.
Retailers must weigh everything from return window duration, to free shipping, to offering refunds versus store credit, against their business interests.
While smaller retailers might struggle to support a 60-day, Give It A Wear policy like Athleta or a Make Our Customers Happy policy like Nordstrom, they can still provide things such as free in-store returns or free shipping for returns submitted within seven days of purchase. The most important thing to remember is this—implementing restrictive return policies as a way to cut costs is a bad idea in most instances.
Did you know that 60% of consumers will check the returns policy before making a buying decision? Unambiguous return policies eliminate shopper uncertainty pre-purchase and set crystal-clear expectations for processing returns post-purchase. Here are three suggestions for improving your return policy.
Cut the return window
Long return windows are great for shoppers but tough for brands. Strike a balance by segmenting customer audiences—set a shorter return period for non-VIP customers so you can mitigate the financial impact of outstanding returns.
Highlight your return policy
Display your return policy with prominence. Doing so helps customers feel more educated and empowered when purchasing, which reduces return volume.
Go beyond free shipping
Claw back the cost of processing returns by upselling shoppers on premium return conveniences such as curbside dropoff, third-party networks (e.g., a UPS store), at-home pickup, and more.
