How to Build a Strategic Product Return Policy For Better CX & Business Growth


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As retail moves away from the wholly brick and mortar days to the online marketplace, customer relationships with traditional shopping experiences have also changed. Once, you’d have had to go all the way back to the shop from which you purchased something in order to return it. Now? It’s as easy as boxing something up and putting a return label on it for postage.

So how, in this age that is supposed to be built around convenience, are so many companies struggling to get their return policy right?

Statistics on Returns

Statistics show that return rates for ecommerce businesses tend to be higher than for physical stores, with an average return rate of around 30%. Given that the first time a customer physically sees the product is after delivery, that’s not surprising. However, it’s still a lot for a business to deal with.

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In 2020 alone, these returns amounted to an eye-watering $428 billion which accounted for more than 10% of all retail purchases in the US. So it doesn’t matter how good things like your sales enablement training is, bad returns are leaving a hole in your accounts.

With businesses that operate online experiencing these issues in a much larger manner than those that only exist in shops, getting your returns process right is vitally important. Here are some key tips on how to improve your returns policy, while creating a better customer experience and boosting business growth.

Gather Customer Information

One of the first steps to take when developing a returns policy that is going to work for you is to listen to your customers. Whether that be through surveys or engagement elsewhere – on social media, for instance – understanding what customers like and don’t like about your current returns policy is the best starting point from which to build. You’d use it for sales and other elements of customer journey mapping. So why not returns as well?

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More than 90% of customers will return to buy from you again if the returns process is easy to navigate and has been handled as they expect it to be. So a short term loss in having to refund or exchange an item for a customer can be a small price to pay if they keep coming back to use your service.

Make Returns Easy (and Fast!)

It seems like an obvious point, but making returns is often viewed as the least enjoyable part of the customer journey. All the disappointment or anger at having received an item that wasn’t to a customer’s expectations is compounded if the process of returning this item is anything other than completely hassle-free.

A great way to do this is to include a return slip in the original delivery, meaning that customers don’t have to print anything out to post the item back to you. For large items, consider offering a free pick-up option to avoid the frustration of having to carry it to a post office.

Similarly, if you can provide information on your website that is instructional – a video or an infographic – showing the step-by-step process of sending a return, it makes the act of returning something quicker and doesn’t require the customer to get into contact with you at any stage.

Most customers expect leniency in the return deadlines, with the majority wanting at least 30 days allowed. Make sure to have a generous return period to account for delays, indecision, and other distractions on the customer’s end.

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Create an FAQ page

You can take the tip shared in #2 one step further and create an entire FAQ page. This has the ability to kill two birds with one stone. Not only does it ensure that customers have almost all their questions already answered, meaning that they can operate in a self-service manner, but it also builds trust.

Many consumers are likely to look for a company’s returns policies before they even make a purchase. Having an easily understandable, thorough FAQ section shows that you have thought comprehensively about all parts of the customer journey.

Ideally, as we know, no one would ever have to return anything. However, this is impossible for any modern ecommerce business to achieve. So in the moments when there are mistakes made, having a solidly presented returns FAQ page inspires confidence in your customer that they otherwise may lose.

Make Returns Free

This may well be the biggest change or factor you can introduce to your returns policy. You can make the process of returning items to you as care-free and easy as possible, but, if you ask the customer to pay in order to return an item to you (especially if it’s because of a mistake that you have made) it’s going to leave a bitter taste in the mouth.

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There are statistics to back this up too. Nearly 80% of online shoppers will buy more if the returns that they may have to make are free. That means you might have to eat the sales tax on shipping, but the chance to make more than you lose out on by offering free returns is big.

If your margins really are that slim, you might consider free returns but not refunding the original delivery cost. Customers are more likely to accept this than paying again to return, as it’s money they’ve already paid, rather than a secondary payment.

So what now?

Building a comprehensive and easy-to-navigate returns policy is a win-win for a company. Not only does it improve your overall customer experience, but it can be, as demonstrated above, really cost-effective. As retailers, we don’t put any less effort into elements like marketing, and retail merchandising, so we shouldn’t skimp on the returns process either.

The reality is, people want to buy online. However, there are risks associated with not seeing products in person – so having a generous returns policy can counteract these risks.

By facing up to the idea that things do occasionally go wrong and having a tailor-made returns policy, you show customers that they can trust you. And, with trust, comes sales.

Nick Shaw
Nick Shaw has been Chief Revenue Officer (CRO) of Brightpearl, the number one retail-focused digital operations platform which encompasses sales, accounting, logistics, CRM and more, since July 2019 and is responsible for EMEA Sales, Global Marketing and Alliances. Before joining Brightpearl, Nick was GM and Vice President of the EMEA Consumer business at Symantec and was responsible for a $500m revenue business.


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