Do you give away free products? Most companies will answer no. But in practice things seem to work different. When shoppers decide to return a product, apparently web stores give answers such as: “Return is not required”, “We don't think that's worth the effort”, “Don't sell it to third parties”, or "Please dispose it in an environmentally friendly way". What is going on here and what’s the reasoning behind this policy? And do we see or expect a change in policy because of the corona pandemic?
Prevention is better than cure: 7 tips to avoid product returns.
According to a survey by the FD (a Dutch Financial Newspaper), shoppers on web shops such as Amazon, and the Dutch bol.com and Coolblue, sometimes do not have to send back product returns, even if they are undamaged. Dissatisfied customers automatically get their money back, without having to send things back.
The online retailers do not want to reveal the numbers, but shoppers tell the FD that, according to their experiences, ‘returnless refunds’ regularly occur, while bol.com writes that their policy is to take back and process all returns". Coolblue says that 'very sometimes' returns are left to customers.
Amazon offers 'keeping returns' as a fixed option for external sellers. Since 2017, external sellers on Amazon who do not want returns, can opt for ‘returnless’ refunds. In addition, dissatisfied customers automatically get their money back, without having to send products back. It is a popular option on Amazon for cheap products with low margins, but in Germany several sellers on Amazon.de have stopped because of the many abuses.
Even items that are undamaged and could have been resold, do not have to be sent back to the web shops. From phone cases to headphones, adapters and cooking pans, often under € 25. If the margin on a product is small, it may be cheaper to leave those items with the customer. A spokesperson for Coolblue calls 'fewer vans' as an environmentally reason to leave returns, in addition to ‘higher customer satisfaction and lower costs’.
What to expect during and after Corona?
Due to corona pandemic we see that online shops are adjusting return windows to reassure shoppers about getting their money back, but longer return windows also add another level of complexity to how companies are managing their businesses.
Today's consumers can be happy that orders will be delivered at all because of the problems around the supply of products. Because of that shoppers might return less quickly and webshops would more likely want products back. Also paying more attention to sustainability and costs and maintain a more thoughtful return policy could be a logical and positive result, but only time can tell if this is really going to be the case.
Prevention is better than cure
22% of online returns are due to the product being substantially different in appearance than was advertised online
There could be a variety of reasons to return a product, like a mismatch between expectations and reality, late delivery, damaged product, or even because the customer found a cheaper alternative elsewhere. According to Chain Store Age, 65% of returns are due to retailer error (no consumer fault) and 22% of online returns are due to the product being different in appearance than was advertised online.
7 tips to avoid product returns:
- Offer complete and correct product content: For instance check if product colors and dimensions are shown correct and complete on each product detail page.
- Show between 5 and 8 product images (360 degree views are most effective) and at least 1 video: The simplest way to compensate the lack of touch and focused examination that customers have access to while shopping in physical stores, is to provide detailed photos of your product. Show (where necessary) how large the article is, for example by showing the article together with a pencil or clearly presenting the dimensions visually. This can not only contribute to your conversion, but also helps prevent returns by avoiding a mismatch between shoppers' expectations and reality.
- Make sure all product specifications are present. If a retailer offers a product feature comparison option, it will be clear to shoppers if your product has more, different or better features than your competitors.
- Review count: Monitor products that need to increase the amount of reviews. A minimum of 10 reviews per product can help consumers make better purchase decisions. Next to that can customer feedback help you improve your products. Better products lead to more satisfied customers. In addition, collecting customer feedback from product returns can unlock valuable insight into your products. Insights, which otherwise would not have been discovered.
- Selling price: Monitor if resellers are keeping prices stable in order to avoid price battles.
- Days Out Of Stock: Monitor if your resellers keep your products in stock so shoppers don't go for an alternative and get disappointed.
- Delivery time & Stock text: Monitor if your resellers communicate a clear delivery time and stock text.
Do you want to avoid product returns in your own webshop or your resellers' webshops? Start monitoring the metrics needed to significantly reduce product returns.