Product returns are a given in e-commerce, especially during the holiday season. In fact, CBRE estimates that $66.7 billion worth of online holiday purchases will be returned in 2022.
While a certain threshold of returns is inevitable, it doesn’t mean they aren’t costly, time-consuming and damaging to both the brand and retailer. Both should take proactive steps to limit the number of controllable returns.
Why Product Returns Can Be a Huge Hassle for Manufacturers and Retailers Alike
Product returns aren’t ideal for anyone involved. The entire process is logistically challenging, time consuming and can often lead to customer dissatisfaction.
The returns process relies upon the customer re-boxing items and sending them back. Products must then be examined upon arrival and either checked back into inventory for resell or destruction. Missing product pieces and damaged original boxing can negatively impact a manufacturer or retailers’ ability to resell a product in otherwise good condition.
Along with the logistical challenges, product returns quickly cause financial headaches for all parties. The returns process forces manufacturers to pay back retailers after a product is returned, directly cutting into a manufacturers’ profitability, and muddying final sales numbers. This inevitably puts stress on the manufacturer-retailer relationship.
When a customer is refunded, that takes away money from the retailer, which negatively impacts the retailer-customer relationship. Because refunds are usually not processed until after a product is returned and examined, it takes time. The longer the lead time, the greater customer frustration.
So returns can be pretty detrimental to your online business—but there are ways to combat high return rates.
Create Robust and Accurate Content to Eliminate Customer Confusion
Controlling the controllable should be top of mind for manufacturers and retailers alike. One key element that is under the seller’s control is ensuring robust product imagery and accurate information. Without that tandem, sellers are asking for confused customers and buyer’s remorse. According to an article by The Robin Report, a whopping 65% of returned goods arise from issues that are under the seller’s control.
“In lighting, furniture, and home décor categories, one of the top reasons products get returned is buyer’s remorse in relation to scale,” said Alysa Land, BrandJump Strategic Channel Manager. “Consumers want to physically see products in their home, and unfortunately after a product arrives, it might not fit their space or expectations based on the information they took from the product page.”
While it’s not feasible to physically showcase a product in a customer’s space, the content you display on the product description page can help aid in a customer’s decision making. Strategies for rounding your product page include detailed product imagery from multiple angles/backgrounds, romance and bulleted copy, videos and even graphics with size dimensions.
To take it a step further, using 3D or augmented reality content can have a major impact on reducing customer return rates. According to Shopify, retailers that invest in 3D and AR technology see return rates reduced by 5%, cart conversion increased by 3% and conversion rates increased by 4%.
“Really good content can go a long way,” said Justine Titus, BrandJump Merchandising Manager. “All of these factors can have a major impact on decreasing returns and increasing customer satisfaction.”
Showcase Favorable Customer Reviews to Make a Big Impact
Manufacturer and retailer marketing play a big part in promoting your products, but so too can user-generated content (UGC) and reviews. UGC product reviews give an unfiltered assessment of a manufacturer’s products and can sometimes resonate more than traditional product page information.
Customers tend to give very detailed and honest reviews, which can be very good or very bad for your brand’s reputation. So, it’s important to solicit good reviews and prominently showcase them. According to BazaarVoice, product pages with customer reviews bring 3.5 times more conversions than those without. That means even a 3/5-star review is better than no review.
To elicit customer reviews, explore partnership opportunities with your retailers to encourage product reviews. Manufacturers and retailers might even incentivize customers by offering a one-time discount in exchange for a product review.
Proudly showcasing good reviews can boost your brand’s reputation and convince on-the-fence customers to make a purchase they’ll be happy with and not inclined to return.
Review Post Purchase Emails to Reduce Mistakes and Prevent Product Returns
Transparency goes a long way in eliminating confusion and future headaches. A simple way to reduce future returns is for manufacturers and retailers to send a post-purchase email. Consider it your confirmation of intent to purchase.
Post-purchase emails provide customers with important information regarding their orders and can be critical in catching errors such as ordering the wrong product or using the incorrect delivery address. Retailer post-purchase communication should arrive in a customer’s email inbox between the time they trigger the purchase but before an item is shipped.
Manufacturers should expect retailers to provide post-order communication after every purchase. When order detail mistakes are identified and subsequently corrected, this reduces time wasted, customer frustration and cuts down on product return rates.
Keep Consistent Pricing to Alleviate Buyer’s Remorse
Buyer’s remorse can be triggered by a myriad of factors, but one that certainly contributes is inconsistent pricing.
Price fluctuation is a routine part of ecommerce strategy, so to an extent it’s unavoidable, especially when running a sale. But for the customer, frequent price changes can cause confusion and even anger, leading to returns. For example, if a customer purchases an item at a higher price point and later notices the price has significantly dipped, that could lead to buyer’s remorse. This might upset the customer and make them feel slighted. It could even lead to a customer triggering the returns process, if only to repurchase the product again at that lower price point.
To combat this, it’s always important to have a consistent pricing strategy. A comprehensive pricing strategy can help you accurately price products to increase sales and profits while remaining competitive.
Getting to the heart of what is causing customer returns of your products is a worthwhile exploration so you can take the steps to make improvements and reduce overall return rates. But doing so, manufacturers and retailers will save time and money, limit customer frustration and boost their bottom line.
