People think that the weeks before Christmas are the most profitable time for retail and eCommerce businesses. That certainly is true, as evidenced by the $114 billion that eCommerce businesses are estimated to have generated in the last holiday season. But January is also a very important time for businesses in terms of profit and product returns.
January is the month of the dreaded "return season." According to the National Retail Federation, Americans returned $284 billion worth of products in 2017. About 25 percent of those products were returned within the weeks following the Christmas holidays, mostly in January. Moreover, the rate of product returns is particularly high for eCommerce businesses with about a 30 percent return of all products ordered online compared to only 8.89 percent purchased in brick-and-mortar stores.
Given the numbers, retailers and eCommerce businesses that do not have a solid return policy in place could see significant cuts into their business's bottom line at this time of year.
While dealing with product returns is admittedly not ideal, research has shown that customers who had a good return experience also become repeat customers. Here are 3 ways you can deal with Christmas returns and keep customers loyal.
Make Sure Return and Exchange Policies are Clear
It's vital that your customers know what your company's return and exchange processes are. Make sure you have clear and easy to understand policies and instructions posted on a page designed specifically for returns. Use several strategies to make this easier for customers, like utilizing a how-to video or web page with diagrams and a list of bullet points. Some retailers even go so far as to include return instructions and return labels in every order.
Have a Sound Return and Exchange Process in Place
Having a reliable exchange process firmly in place before big shopping seasons will ease the pressure on your staff and make transactions go smoother. This is essential for companies that allow goods to be purchased online and returned in the store, and vice versa. This multi-channel system not only ensures customer loyalty, it also encourages shoppers who return items in-store to make additional purchases while at the shop.
But in order for this to be successful, retailers should use a platform where the staff can easily see online and in-store inventories and check whether the product is covered by the company's return policy. It will also make it easier to see whether there are any cash back or on-the-spot credit promos in place.
Transform Returns Into Exchanges
Another way to deal with returns is to transform it into a product exchange. A lot of customers want to or are willing to exchange an item. Maybe they want to exchange a dress for one with a different color or gadget for one of a different model. However, some consumers are not aware that they can exchange their item for something else.
Make sure your customers know they can do this. Have the information posted on your site or place friendly customer service staff on the floor who can point out promos and explain the exchange process. Remember that exchanges are far better than giving refunds.
Product returns and exchanges are part of doing business. Retailers can cut down on their losses by ensuring that their customers keep coming back. A good return and exchange policy, great customer service and a solid return process go a long way in keeping customers happy and loyal.