E-commerce Returns Management: Strategies for Streamlining Processes and Improving Customer Satisfaction

Intro

Whether we like it or not, returns are inevitable in any e-commerce business.

In fact, shoppers send from 15% to 40% of their online purchases back. Now consider this: 740% of consumers believe e-commerce retailers need to make improvements in their return processes.

What should you know about returns management in online business? How do modern e-commerce trends correlate with customer satisfaction? And what strategies to adopt for enhancing the returns process?

This guide gives you all answers and tools to streamline e-commerce returns and satisfy your customers. As a bonus read afterward, explore two alternative approaches to handle e-commerce returns.

Jump in.

What Is E-commerce Returns Management?

Returns management in e-commerce refers to dealing with customers who wish to return products purchased online. One of its main elements is reverse logistics – the movement of goods back from the customer to the company after selling them. It aims to ensure a seamless and smooth return experience for buyers and prevent unnecessary business losses.

Here’s a list of the most popular reasons why e-commerce clients may want to send a product back:

• It was ordered accidentally.
• It’s of the wrong color, size, shape, etc.
• It isn’t needed anymore.
• It doesn’t match the description or expectations.
• It has missing parts.
• It’s damaged.
• It has a better price at another e-shop.

Each situation is different. But generally, every such experience influences how your customers feel about your brand. Read on.

How Returns Management Impacts Customer Experience in E-commerce

Returns experience is a critical factor for customer satisfaction which, in turn, predetermines customer stickiness and loyalty.

Just look at these numbers:

• 50% of buyers regard the ease of returning goods to retailers as incredibly important for their online purchasing experience.
• 96% of consumers think return policies demonstrate how much brands care about their audience.
• Nearly six in ten (57%) shoppers would never buy from a company again after a bad post-purchase experience.
• 97% of customers are likely to shop more at an e-store when provided a positive return experience.
• More than half of internet users, specifically 58.4%, make online purchases of products or services on a weekly basis.

As you can see, an easy and streamlined return process can increase customers’ trust and confidence in your brand and boost product sales. Let’s discover how to simplify and facilitate it to achieve customer satisfaction.

How to Optimize Your E-commerce Returns and Delight Your Customers

Consider five best practices with real-life examples below.

1. Work out a buyer-friendly return policy

Did you know that 67% of consumers would check your return policy page before buying a product from you?

A solid return policy allows online shoppers to make purchases without second thoughts. It can help you ensure brand transparency and win your consumers’ trust.

Every e-commerce business should create a no-hassle returns policy for improving customer shopping experiences,” believes Prabhath Sirisena, Co-founder & CPO at Hiveage. “A dedicated page for it must be visible and accessible right from the homepage. Besides, it should contain step-by-step instructions on what a customer should do to return an item.

As for the duration, a 30-day return window is a common practice among retailers. However, you may extend yours to 45 or even 60 days, giving your customers more leeway,” he notes.

Nike, for example, has a 60-day return policy with some exceptions. Some brands go even beyond that and give as many as 90 days for returning goods. One of those is EleMake, a seller of high-security locks. The brand also clearly outlines the guidelines for non-installed and installed product returns.

2. Switch to paper-free returns

If you haven’t done that already, there’s no better time than now.

With custom QR code labels, e-commerce sellers can kill two (or even three!) birds in one shot when managing customer returns. First of all, such digital solutions support sustainability and help go greener. Second of all, they save time and money. And third, they leave customers fully satisfied with the return process by simplifying and speeding up the whole procedure.

So, if you want to revolutionize your customer’s return experience, a printless QR code is a must-take approach.

When given an option, over 50% of customers prefer paperless labels. Trying to satisfy their customers, such companies as Amazon, Nike, and ASOS have already enabled paper-free return options at their e-commerce stores.

3. Personalize returning experiences

There’s an underestimated value in getting personalization right. It works not only for increasing e-commerce sales productivity but also for managing returns efficiently.

Retailers should stop applying a one-size-fits-all strategy to returns management. Attempting to accelerate omnichannel e-commerce and deliver a better post-purchase experience, companies should consider personalized returns. One of the surefire ways to do that is to develop a unique e-commerce returns policy for loyal or long-term customers, for instance.

In any case, brands must strive to make it personal for every buyer.

How do you know what your customers expect from you? For example: would they like to wait for your local pickup service or would they rather bring the package to the designated point or your logistics partner (UPS, USPS, FedEx, etc.)?

To find that out, you may gather customer feedback and leverage data analytics to meet customers’ needs and improve their experiences when performing reverse logistics. Check out how different brands harness the power of personalized marketing to enhance customer return experience:

• Local pickup program – Levi’s
• “Personalized return policy” if a customer needs a specific timeframe to send the purchased item back – Jones & Son
• Free return shipping incentive for buyers who choose to receive a store credit instead of a refund – Dollskill
• Extended return window of 90 days for VIPs only – Road Runner Sports

Merely 9% of brands have implemented VIP return programs so far. You can become one of the pioneers in e-commerce who utilize such a tactic to delight customers with pleasant bonuses for being loyal.

Speaking of free shipping for returned goods, e-commerce businesses rely on this strategy more eagerly, as a matter of fact. Let’s discuss it more in-depth in the next paragraphs.

4. Offer free return shipping

Based on MySize’s research, 60% of consumers won’t buy from a company if it doesn’t guarantee zero shipping charges for sent-back goods. Indeed, free return shipping can improve your customer retention rate and contribute to your e-commerce growth overall.

Take a look at the below example:

Shoppers can enjoy free shipping for returned items at FITUEYES within 30 days after the purchase.

It’s worth knowing, however, that such a gesture may be rather costly for an e-commerce retailer.

While the whole returning process may cost you significantly, there are some strategic ways to minimize loss and win your customers over at the same time. You can limit free returns shipping to some specific cases. Just to name a few: as a part of your customer loyalty program; on particular product categories; on exchanges only; or one-time valid free shipping of returned products.

Here’s how Jackson Wayne, an American brand of leather goods, does that (see the screenshot).

5. And finally – automate!

Returns management is one of the mandatory areas of automation you should definitely consider to eliminate the major problems every successful e-commerce business faces sooner or later.

Why not use a unified platform for smarter returns?

An automated solution for e-commerce returns management can take the burden off your shoulders and put the entire process on autopilot. Such a tool can help you centralize returns in one place and manage the logistics network. It allows you to track returned products and streamline all operations with them: collecting, evaluating the condition, restocking, etc.

You may pick one of the following returns management systems:

• ReverseLogix
• LoopReturns
• parcelLab
• HappyReturns
• Returngo.ai
• AfterShip
• Narvar
• Swap Commerce
• Returnly

For example:

When planning to start a return process at Zutano, shoppers need to head over to the Returns Center powered by Returnly.

Here’s another example of Loblola’s Returns Center managed by AfterShip.

Additionally, consider implementing a referral program to encourage your satisfied customers to spread the word and attract new shoppers to your e-commerce business.

Alternative Strategies for Effective Returns Management in E-commerce

You can always suggest some alternative variants to your customers whenever possible: store credit or exchange.

Store credit

Without exaggeration, store credit is one of the best alternative strategies to streamline returns management. It helps you ensure money stays within your e-commerce business, encourage repeat purchases, and retain more customers. It also gives both your clients and you more flexibility in making choices.

In some cases, it can even prevent a return entirely. Let’s suppose a shopper made a purchase from you and then found the same product $20 cheaper at a different e-store. Now the customer wants to return the item and get the money back (yup, some shoppers do that). At this rate, you can offer a store credit to cover the difference.

Exchange

If approached smartly, converting a return into an exchange can be a great competitive advantage.

Exchanges are more valuable than returns and refunds because they contribute to the profitability of your business. You don’t lose anything, and your customers are left completely satisfied with the exchanged products. By getting the right items into your buyers’ hands, you drive loyalty and increase customer lifetime value.

Moreover, you may offer all three options as per the customer’s preference: return with a full/partial refund, exchange, or store credit.

Manage E-commerce Returns Like a Pro with These Tips

With the rapid growth of e-commerce, your company may face the challenge of managing an avalanche of products sent back to you. By employing strategic measures and technologies mentioned in this article, you can improve the returns management process for your online business and ultimately achieve customer experience optimization.