Each year the heights of the winter shopping season shine a light on the retail sector’s million-pound headache: returns. The relative ease with which unwanted clothes, toys, and other goods can be returned by consumers, has led to an increasing trend of retail returns as the norm with millions of consumers now using their bedrooms as the fitting room.
This year was no different. Compounded by the rising cost of living, the UK saw 57% more returns over the Christmas period when compared to the previous year. This has left some retailers struggling to keep up, with many trying to stay on top of outdated operations processes that simply aren’t built to withstand such extensive use of their returns offering. Such problems were also made worse by external pressures shaking the UK’s retail sector. Almost half (49%) of the UK’s major retailers have felt the effect of the postal strikes as they rely on Royal Mail as a significant courier option.
In the absence of improvements from couriers and facing a consumer base that is increasingly willing to utilise the returns process, retailers must do what they can to streamline their processes and provide an optimised and efficient service always. Whilst there is no silver bullet for these issues, retailers are far from helpless.
The importance of optimised returns management
Almost ten million more parcels succumbed to delays last year, leaving customers unsure whether they can trust delivery estimates or make orders online in the knowledge that goods will arrive as needed. However, many brands have not helped themselves by failing to implement strong communications regarding order status or procedures to make the end-to-end order process as smooth as possible.
One example is giving customers the chance to make their returns using an online portal, rather than just in-store. Both consumer and retailer benefit from such a process, gaining access to a wealth of information that can inform each party. An online portal also allows the shopper to indicate why they want to return the item or even organise to collect the goods from their home instead of physically returning it themselves.
A returns platform also offers consumers the chance to track their orders through their mobile devices. This gives them peace of mind and the freedom to check the status of their package at any given time, which in turn alleviates pressure on customer service staff who can focus their time elsewhere, rather than responding to enquiries that could be dealt with through an automated alert, such as SMS or a more transparent platform.
The information received at the retailer’s end is similarly beneficial. If the retailers have multiple locations where returns are processed, data from the online portal can be used to strategically assist with the distribution of returned goods. The constant stream of information and data can be used to distribute items to the optimal location. Collecting information from the customer like their reason for return – whether it’s damaged goods, an incorrect product, or simply customer preference – also means the retailer has time to organise the logistics process and pre-evaluate what to do with the good once it is returned.
The importance of returns
While retailers can take steps to optimise their utilisation of staff, software, and logistics processes returns may well remain a pain point – but one that can be lessened. Significant improvements must be made, and as technology develops to smoothen and streamline this process, forward-thinking retailers must reap the benefits. This should also come with a prioritisation of transparency and customer communications. If customers are informed at each step of the return and refund journey, this engenders trust and could ultimately encourage them to shop with the retailer again. This is the making of customer loyalty.
What is inescapable is that returns are fundamental to the modern online shopping experience. A solid returns process can be the making of a strong relationship between consumer and retailer ensuring repeat purchases in the future. However, when done badly returns can be the most frustrating stage of the customer journey, which only highlights the huge importance of keeping customers in the know with proactive communications and optimising each step of the customer journey through the technology available.