How to Deal with the Retail Hangover of Endless Returns

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Drunk shopping is apparently a $45B e-commerce business. Surprised? The average person who drinks has made at least one inebriated purchase — with shoes and clothing the most common culprits.

Of course, impetuous purchases are not necessarily a problem for the retailers benefiting from these tipsy shoppers. But here’s another piece of data for you: People are far more likely to return what they buy online. While shoppers return 5 to 10 percent of what they buy in-store, they return up to 40 percent of e-commerce purchases — 89% of shoppers have returned an online purchase at some point.

This is also why many retailers have more and more flexible return policies. To compete with all the possible places you could “drunk dial” for stiletto heels late at night, retailers have to assure easy returns. But to be truly “easy” takes more than a lax return policy. It takes customer support that’s a cinch to use. That’s why, according to a survey by Happy Returns, a solid three-quarters of Americans say returns are their least favorite part of online shopping.

All of these numbers are exactly why shoppers — whether they’re drunk or not — are often at the mercy of customer service platforms. And why it’s important for retailers to offer customer service that’s efficient, effective, and scalable.

The culture of returns

Companies like Nordstrom and Patagonia have long set a gold standard for return policies that most other companies couldn’t uphold — and didn’t really have to. Then, along came Amazon, and the game changed. Suddenly, with Amazon Prime membership, anyone could get anything delivered for free, hyper-fast. Now, all companies are under pressure to offer easy returns. 

Just this past December, CNBC reported that the forecast for returns for the holiday season was $41.6B. Note that this number is nearly as much as the total spent above by drunk shoppers! UPS similarly reported handling more than a million returned packages a day during the holiday season. Yikes!

No wonder consumers today find it easier to order shoes now, and try them on later. If they don’t fit, it’s a matter of pressing a few buttons to change their mind. In fact, 62% of shoppers say they’d specifically buy again from a brand offering free returns and exchanges. 

How customer support can discourage returns

Returns don’t just mean the loss of a sale. They can be damaging to your profit in other ways, too. If your policy includes paying the shipping cost of returns, you don’t even break even on the transaction. And there’s also a cost associated with inspecting and reshelving returned products. Then there’s the time your customer support organization spends orchestrating returns — the back and forth emails, the forms, the processing.

Can you avoid returns entirely? Probably not. Can you discourage them? Sometimes you can, especially with the right customer-service mechanisms in place.

Help them get the right product the first time with self-service options that enable customers to research products easily. In particular, by connecting an answer bot on your website or app to your treasury of FAQ content, you enable customers to ask questions about products upfront.

Reduce uncertainty along the entire purchasing journey by enabling multiple ways for the customer to reach out directly with questions they can’t answer themselves. The more ways customers can reach you, the more likely they are to have a successful customer-service experience.

But make returns easy, too

The truth is, no matter how well you orchestrate the buying process, and no matter how accurately you inform the customer about products, there will always be returns. So it’s in your best interest to facilitate easy returns so that customers have a consistently good experience with your brand. Maybe they don’t want the thigh-high silver boots they bought at the tail-end of a big night out, but when they sober up and see the light of day, they may realize they need a pair of sensible shoes for work. Who better to buy it from than the website that makes transactions easy? Good customer experience breeds effective customer relationships down the line.

In fact, the VP of Services and Operations at Zappos (probably the main place people drunk-shop for shoes) says that “Our best customers have the highest return rates, but they are also the ones that spend the most money with us and are our most profitable customers.”

To make the return process easy for both your customers and your customer support team:

  • Provide explicit, easy-to-find return information through your FAQ and your answer bot. Self-service options are always the best first line of defense.
  • Automate the returns process as much as you can. Save your support team for more complex issues.
  • When you know you’re likely to encounter high return rates — for instance, post-holiday season — consider pre-populating your chat bot with common responses that answer the biggest questions customers typically have about returns.
  • Ask for feedback in the moment so you can improve your products and your customer experience — hopefully leading to fewer returns in the future!

Most retailers have a love-hate relationship with returns, but with a savvy strategy, you can tip your return experience in your favor. A liberal return policy can actually work in your favor if it puts customers at ease and encourages them to buy from you. With good customer service and self-serve practices, you can align their needs with your products more succinctly over time.

Published January 31, 2020
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