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How Your Return Policy Might Be Losing You Money… And 8 Tips For Reducing Return Rates On Your eCommerce Site
The transition to shopping online is like the transition to dating online, trust and transparency is key. We come to the table wanting to know everything in advance. Your job title, your past relationships, your hobbies, how old you are, what are your likes and dislikes…there’s no mystery or opportunity for self-discovery anymore.
Same with shopping online. We search for a specific item that we want. We have done all the research and price comparisons already. We’ve read every review and come to your store already knowing what we want. Whether we purchase ‘Item X’ from you or from your competitor comes down to some key things.
- Established reputation and 4-5 star reviews
- Easy shopping and checkout experience
- Low or no shipping costs
- Simple, transparent and secure return policy
- Providing alternative payment opportunities
Frankly, we could spend days (weeks even) discussing all of these different points, but for now, let’s focus on how your return policy impacts your bottom line.
Why is Your Return Policy so Important to your Bottom Line?
Your bottom line is reliant on so many variants. In a world where fast and free shipping is expected, you have to constantly work to find ways to set yourself apart and provide top customer service in all things – one key ingredient being your return policy.
Splitit conducted a survey in November 2019 jointly with Google Consumer survey, which included 500 respondents from the US. This survey revealed that a good return policy is not only key to overall customer experience, but directly affects Web conversion and, ultimately, a retailer’s bottom line.
The Splitit survey revealed that nearly 60% of consumers have returned an online purchase, with 38% having returned up to 10% of all online purchases they have made. Splitit also discovered that 48% of respondents have purchased multiple variations of an item with the intention of returning one or more items, a process known as “bracketing.”
52% of consumers have abandoned an online purchase out of fear of a difficult return process. This number increases to 67% for millennial respondents (ages 25-34) who grew up in a world of online shopping.
“Whether it’s a fear of buyer’s remorse or uncertainty about fit, our research shows that, today, returns are a top consideration for consumers even before their purchase is completed,” said Brad Paterson, CEO of Splitit.
What is a Good Return Policy
Hassle-free is the way to be! Communicate your return policy really well and educate everyone about these policies to help remove any stigma of fear. Write the specifics on your website in places that are easy to find, like on your main header banner, on your product pages, in your checkout process, and perhaps even on one of your footer pages. Then rewrite them again (step-by-step) on the email receipts you send your customers, as well as place a copy of them in the package with their product(s).
Splitit’s survey also revealed the top qualities consumers look for in a return policy:
- 20% of respondents said a return shipping fee would make them less likely to purchase from a given retailer.
- 39% of respondents ranked “free shipping” as the overall most important feature of a good return policy.
- 30% of respondents ranked “no questions asked” as the most important feature of a good return policy.
8 Tips on How to Reduce Your Return Rate
Once you’ve created your excellent return policy, the next question you are probably about to ask is, “How do I reduce the amount of returns I do get?”
With so many online shoppers returning their purchases, retailers everywhere are trying to find solutions to reduce the amount they get back. While it is important to provide really good Return Policies, it is also important to establish practices that will also prevent them as much as possible.
Here are some ways that can help you reduce your return rate on your eCommerce site.
- Provide high quality (preferably 360 degree) images of products so they are getting an accurate idea of what the product looks like, without having to imagine it themselves. Having videos are also really great, because they can show the product and how to use it in further detail, better meeting the customer’s expectations.
- Create VERY detailed product descriptions to help customer’s make informed purchasing decisions and more precisely meet their expectations.
- Offer many sizing options and create guides that customers can relate to to help them select product sizes more accurately (especially when selling internationally).
- Allow product reviews on your site so your customers can read testimonials about your products directly from other consumers. This builds trust.
- Establish excellent customer service practices via email, phone, social media, or live chat. Inevitably something will go wrong. That’s life. But the way you respond to problems will go a long way to reassuring your customer.
- Place your return policy where it is easy to locate and understand. Especially when customers are not quite sure whether or not they wish to make a purchase. Having this information readily available can help build their confidence.
- Combine a simple and transparent return policy with flexible payment options like Splitit’s installment payments or buy now, pay later solutions, to give consumers the confidence and time to make the right purchase without creating a burden on their finances.
- And, finally, be mobile-friendly everywhere! Make all of the above information easily accessible and legible on mobile devices. More than half of online shoppers today are shopping from mobile devices, and this trend is continuing upward.
Want to know more about how alternative payments can help grow your bottom line? Contact us today!