Picture this: Brand-new distressed leather boots come with a nice selection of extras — bags for storing the individual boots, inserts to keep them properly shaped and a neatly folded reusable shopping bag.
Placed on top of it all is an unexpected surprise: a ready-to-use return label. The retailer was obviously a mind reader: The ill-fitting boots had to be exchanged. A quick repackaging of the merchandise and one label application later, the boots were on their way back to the manufacturer. No questions asked, and no additional effort on the customer’s part.
This is the returns experience customers expect from both brick-and-mortar and online stores, which cumulatively took back $816 billion in merchandise in 2022. Here are six more statistics that no company can afford to ignore where returns are concerned:
- Billions of dollars in merchandise are coming back for processing. In 2022, consumers returned $212 billion in merchandise from online sales and $603 billion from in-store sales.
- Holidays bring a special treat. With 16.5% of all purchases being returned — and consumers expected to spend $1.3 trillion this holiday season — both online and offline companies have to brace themselves for a backflow of goods in the coming months.
- Your customers are keeping tabs on return policies. Forty percent of customers buy items with the intention of returning some of them, and 68% review their suppliers’ return policies before hitting “buy.”
- And they’re not particularly patient about it either. Four in 10 consumers say they shop elsewhere when a retailer takes too long to process a refund, and 73% make that break after three negative experiences with a specific seller.
- Done right, returns management is a great customer retention tool. The good news is that most customers (92%) say they’ll continue purchasing from a retailer that makes the returns process easy.
- This is no longer an “ecommerce problem.” Interestingly, brick-and-mortar returns effectively caught up to online returns over the last year or so, which means high return rates are no longer just an ecommerce problem. Four years ago, brick-and-mortar stores typically saw 5 to 10% of products sold in-store returned to them at a later date while online sellers were taking back 15 to 40% of the orders that they shipped out. In 2022, both sales channels saw returns at a rate of about 16.5%, according to the National Retail Federation.
- Customers will return anything. The most returned product categories include clothing, bags and accessories, shoes, food and beverages, and consumer electronics.
- Inadequate return policies equal more abandoned shopping carts. More than 70% of online shopping carts fail to make it to the checkout stage — meaning seven out of 10 consumers ditch carts after filling them up. Inadequate return policies are one of several reasons for cart abandonment, along with issues like high additional costs, forced account creation and a complicated checkout process.
Don’t let the goods pile up in the corner
Good returns management doesn’t end when the goods arrive back at your facility. Without an effective system for managing reverse logistics, much of that merchandise may wind up languishing in the corner of the warehouse or stockroom. This not only takes up space, but it also prohibits quick resale of the merchandise and translates into lost revenues. And if it forces customers to wait around for their refunds or replacements, they’ll probably shop elsewhere next time.
For best results, retailers need dedicated returns processing areas, returns management software solutions and partners that understand the relationship between customer retention and good returns management. This is important all year round, but it’s especially critical during the holiday season and the expected $212 billion in returned goods that everyone is bracing for.
From the time a returned product arrives at the warehouse, distribution center or third-party logistics (3PL) provider, Roadie helps companies streamline returns processing and transform their processing approaches into a customer service opportunity.
Featuring the nation’s largest local, same-day delivery network of independent drivers, the Roadie crowdsourced returns network ensures greater speed, convenience and control to shoppers. And when you give those customers a simple, streamlined returns experience, you’ll earn their loyalty and keep inventory moving efficiently within your network — and not piled up in the corner.