Here’s Why You Should Retool Your Return Policy to Improve Profits


Running an ecommerce business that deals with physical merchandise? One of the most important things you need to address is how to handle product returns. With 2018 shaping up to be record-setting year in this industry, being prepared is the key to success.

Product returns are just as much a part of online retailing as sales. While they used to be viewed as a pain point, such is no longer the case. New research has shown that having a streamlined, hassle-free returns process can boost your overall sales, giving your online store competitive advantage.

Not All Product Returns are Created Equal

Product returns have been historically viewed through a negative lens by retailers. In some cases, they’re the result of the wrong product being shipped, a damaged item being received or buyer’s remorse. While you will have customers who returns purchases, you can convert distraught consumers into loyal customers by providing an easy for them to send products back.

In fact, a new study by UPS finds that in 44% of the cases, a customer coming back to an online store to return a purchase makes a new one. But making your return policy work in favor of your bottom line will take some retooling of it.

Here are some tips you can use along the way:

Make Your Return Policy Easy to Understand 

The initial and most important step to take is to clearly define your product return process. You also want to ensure that everyone within your organization understands it. Along with making sure the staff understands the process, you should make it transparent on your website, too. Reiterate your policy when you send a confirmation to customers once they place an order for added effect.

Consumers understand that since they are shopping online, there are many potential reasons why they would need to return a product. Make sure to highlight the simplicity of your return policy to avoid confusion.

Addressing Returns

Product returns are inherent in the online retailing world. According to the Wall Street Journal, roughly one out of every three buyers will end up sending the item back. The importance of providing a simple return process is as important to the shopping experience as sales.

The leading four legitimate reasons why a product would be returned include:

  1. Product was damaged while being shipped to the consumer.
  1. Advertised product did not match what was sent to the consumer.
  1. The product did not properly fit the consumer.
  2. The wrong item was shipped to the consumer.

While returns are part of selling online, there are certain steps you can take to reduce the return rate:

  • Ensure that your inventory management control applications are working properly. You want to only advertise the actual products you are selling to reduce returns.
  • Prior to completing the transaction, ask the buyer whether they have confirmed the sizing details. This added step can reduce the risk of having a customer return their product and can help them get the product they want with the appropriate sizing. (Be sure to have a comprehensive sizing chart available to avoid misunderstandings.)
  • Ensure your order fulfillment service provider is following industry-best practices. If you are using a third-party service to handle your order fulfillment, ensure they are scanning the SKU of the product, so customers are getting what they ordered.

By taking these proactive steps, consumers by and large will have a more pleasant shopping experience. At the same time, the total number of returns will be at manageable levels.

Consumers Read Your Return Policy

Consumers want to make sure they know the return policy of the online retailer prior to buying anything. In fact, most consumers read the return policy before buying. So it needs to be comprehensive and address the most common questions that consumers may have in an easy to read format.

A simple return policy helps convert more shoppers. Proof? UPS found that almost 80% of visitors will give up on your site and leave if they don’t like what your return policy says.

Using Returns to Generate More Sales

One way to gain an advantage over your competitors is by using your return policy as a selling feature. Look at what your competitors are doing when it comes to returns and refine your policy, so it’s more streamline.

If you make your return process simple, it will give your prospective customer more reasons to buy from you instead of a competitor. In essence, hassle-free returns have the potential to attract new customers that grow your bottom line.

What Consumers Want

Assuredly, consumers enjoy shopping online. But they still hold on to the old brick and mortar style of product returns. In a retail store, a consumer brings back the item with your receipt and the return is processed on the spot. If your online return policy mirrors the brick and mortar format, then you should be able to gain additional customers through ease of process and familiarity.

By providing consumers with a shopping experience that’s similar to what they’d find at a store in the local mall, you stand a better chance of acquiring them as a customer. The most important thing to keep in mind is you want to have the easiest, hassle free return policy possible or shoppers will simply take their business elsewhere.

Making Returns Work

We’ve touched on how consumers typically read the return policy of an online retailer before they actually move ahead and make a buying decision. Savvy online business owners are aware of this trend. They strive to reduce any potential bottlenecks by making the returns process and policy hassle free.

Consumers crave simplicity. When you give it to them, they are going to buy from you more often. The choice is obvious: easy returns mean more sales.

Businesswoman delivering box stock image

The post Here’s Why You Should Retool Your Return Policy to Improve Profits appeared first on Tweak Your Biz.



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