This Holiday Season, Turn Refunds Into Repeat Purchases
In light of COVID-19, online shopping has seen a surge in popularity, and 48% of shoppers plan to shop online for the holidays. But a surge in online shopping is likely to result in a surge of returns, as well.
An average of 30% of purchases made during the holidays are returned within 30 days, so merchants need to be prepared. High returns result in lower annual revenue, but also impact customer experience and loyalty.
When a return is initiated, your brand has an opportunity for another customer touchpoint. If the return experience is frustrating, you risk losing that customer’s trust. But if that experience is positive, you can convert that return into a repeat customer. In fact, 84% of shoppers said a positive return experience makes them want to shop with a brand again.
Read on to learn three simple strategies for reducing your return rate, while ensuring that the customers who do return an item have a positive experience.
Start with an ounce of return prevention
Your return risk will vary by vertical. In 2018, surveys showed that the most returned items are clothing and accessories, followed by shoes, and then electronics. Whether or not your Shopify store falls into one of these verticals, you’ll want to be sure to optimize your product detail pages (PDP) so that your customers can make well- informed purchases.
This helps to reduce avoidable returns, and results in happier customers. Prior to checkout, your ecommerce store should empower your customers to choose products that are right for them.
You’ll want to make sure your products are well described, imagery and video accurately represent your products, and product descriptions are detailed. This is because in clothing, accessories, and shoes, sizing can be a challenge for customers shopping online.
For merchants selling in these verticals, including a sizing chart on every product detail page (PDP) will help to reduce friction in sizing. Offering easily accessible customer support, and encouraging customer feedback and reviews will also guide your customers to purchasing the item that is perfect for them.
For example, a customer might return a sweater because the color wasn’t quite what they expected. This return could have been avoided with a PDP that included accurate images and a detailed description of the sweater. Or, a review that included a photo of the sweater and a comment about the item’s color may have given your customer a heads up about the color.
Learn more about optimizing your PDP: 11 Ways to Optimize Your Product Detail Page
Next, make sure your return policy is crystal clear
Data shows that 83% of consumers read your return policy before buying. Clearly, an accessible and concise return policy is an important factor for customers in making a decision to purchase. Given this, making sure your return policy is easy to find and includes the answers to all the questions your customers might have is crucial.
What to include in a return policy
In your return policy your goal is to answer every question that a customer might have. The more detail you can provide, the better. Here are some of the key points that should be included in a return policy:
- What items can be returned or exchanged, and what items are final sale.
- The time frame for returns or exchanges (ex. 30, 60, or 90 days past purchase date).
- In what condition can items be returned (ex. lightly worn, tags still on, original packaging, with receipt, etc.).
- What products can be returned for (ex. store credit, full refund, a product of equal value).
- How products can be returned (ex. return to store or return by mail or courier).
- How to initiate a return or exchange (ex. an email address to contact or a web page to visit).
- The fees for making a return (ex. free returns, service fee, etc.).
How to display your return policy
Your return policy should be easy for your customers to find. Make sure it is discoverable by including the policy in several hard-to-miss places on your website. Here are the most effective places to include the policy:
- In your website footer, and on your FAQ page.
- On product detail pages.
- On the shopping cart page and throughout checkout.
Your return policy will likely be long, so in most cases you will simply link to the full policy. On your product detail page, and at checkout, you can include a brief version of the policy that includes a CTA to read the full policy. See below an example of Thirdlove’s shortened policy, which is displayed on their PDP. Here, you can view an example of their full returns policy page.
Example of Thirdlove’s return policy, displayed on their PDP.
When customers find your return policy without friction, and it answers the questions they have about returns, they gain more trust in your brand. Your return policy is a key factor in conversion because a customer is more willing to make a purchase if they feel confident in their return options.
It provides a sense of security that your products are guaranteed to be what they are represented as. When merchants don’t give this sense of security, they risk customers becoming suspicious of the quality of a product.
Flexibility and convenience encourage purchasing
The particulars of your return policy will vary between verticals and as well as your business’s unique needs. But one aspect of returns is universal. They should be as flexible and convenient as possible.
A detailed PDP and a concise, easy to find return policy will help reduce the amount of merchandise that is returned. But achieving a return rate of 0% is impossible (unless your store doesn’t accept returns). When a customer has decided to return your product you’ve lost a sale, but you haven’t necessarily lost that customer.
According to a 2018 consumer report, 96% of people would shop with a retailer again based on an “easy” or “very easy” return experience. The return experience is an opportunity to build that customer’s trust and loyalty further by providing a frictionless experience. If your brand can do that, you may earn a loyal, repeat customer.
So how do you create an “easy” return experience? Here are three strategies that will help provide a positive return experience:
Provide as many options as possible for making a return. For example, offer the option for a customer to choose between returning the merchandise to a brick-and-mortar store, or return it by mail or courier. The more options that you offer, the better. For the 2020 holiday season, the return by courier or mail option is important to consider adding if you don’t offer it already. A spring 2020 survey by Canada Post found that the option to return items by mail or courier was an influencing factor to 40% of shoppers when deciding which retailer to shop with, while 25% of shoppers look for in-store return options.
Provide a wide window for returns. This is already an established best practice for the holiday retail season, and it’s even more important in 2020 due to social distancing. During the pandemic, 34% of online shoppers picked one retailer over another because of their extended return window. The Coronavirus pandemic has resulted in shipping delays and backlogs. Since many consumers will opt to make returns by mail, offering a wider returns window will account for delays. Consider extending the return period for purchases made in November onwards to January, or even early February.
- Provide a return shipping label with every order. Some retailers include a pre-printed, postage paid return shipping label with orders. This is the most convenience you can offer your customers, but some find that a pre-printed label adds too much convenience. It makes returns so easy that it leads to higher return rates and a missed customer touchpoint. Instead, consider offering a printable return label (sent by email) after your customer has made contact with your support team.
Providing multiple return options, a wide window for making that return will accommodate your customer’s needs, and a return shipping label will help to create a streamline, stress-free return process.
This is especially important during the holiday season. The end of year holidays are a hectic time for everyone, and shipping delays are common. A flexible and convenient return policy will help alleviate pressure on your customers, and give them confidence in your brand. With one positive returns experience, that customer will be likely to return.
Automate returns on Shopify
Shopify doesn’t include built-in returns management functionality, but you can leverage apps or partner technology to automate your returns process.
Apps and partner tech will typically provide you a dashboard for managing your return policy settings and return groups (for product collections). Other features usually include:
- Order lookup, which allows a customer to enter their email address and order number to access their order status.
- The option to create simple forms for customers to use to submit return requests.
- The option to create shipping labels that customers can print out.
- Process cash refunds and gift cards (in-store) credit.
- Integrate with shipping apps so that you can generate shipping rates for returns, or allow customers to track returns shipment status.
Here are a few of your Shopify store app options:
Another way to make the return process easier on the customer (and you!) is to implement a partner tech like Gorgias, which is an all-in-one helpdesk and livechat solution.
Gorgias can detect common customer intents in incoming messages and automate processes and responses based on those intents. A refund or exchange request can be flagged by Gorgias, reducing pressure on your customer support team and speeding up processing of requests.
Reduce your rate of returns this holiday season
Reducing your return rate will benefit your business in many ways. You’ll see an improved average order value, a higher revenue. But this isn’t the only benefit to optimizing your store’s return process. A positive return experience can result in long-lasting customer loyalty.
This holiday season, rather than viewing a return request as a failed sale that costs your brand money, look at it as an opportunity to grow the customer relationship. By investing in that relationship, you’ll boost your future sales.
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