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March 9, 2021

Returning the favour: how Singapore’s carriers can add value to retailers in returns

This blog article is part of our Singapore market insight series, exploring opportunities for parcel carriers and offering insight and comparison to other parcel markets around the world. Download your free copy of our Singapore market report here.

As ecommerce growth continues, one of the biggest drawbacks for retailers is consumer returns. Shoppers are increasingly used to treating their bedrooms as fitting rooms, sending back items that don’t match their expectations. With COVID pushing more volume online, the overall rate of product returns have tended to increase in most markets. While Singapore tends to experience slightly lower return rates than other markets, even in typical hotspot categories like apparel, returns volume still represents a significant opportunity for carriers.

Lockers enable fairly convenient local returns for those with easy access, though the numbers of locker banks are currently limited, with just 330 locker banks and poor coverage across the city. With 26 million return parcels per year, even the planned 1000 new banks will clearly not be able to manage the volume alone.

That means that the vast majority of returns currently go through post offices and parcel shops. Typically, the consumer will use a pre-paid returns label or request a pickup via the retailer website. However, neither of these journeys really connect up the dots for the retailer – they don’t necessarily get the full picture of customer data and returns data. Communication about the return can be fractured and unclear, coming from both the retailer and the parcel carrier, or neither.

The lack of a digital aspect to return journeys in Singapore may be more important than the physical questions of where the parcel is sent back from. Currently, carriers aren’t offering a fully digital experience for customers and do not offer a platform to retailers where they can leverage the data this generates and improve their returns process – a near-universal objective in modern retail.

A big problem with a big price tag

The set of problems that come with ecommerce returns are worth a huge amount of money to retailers, with return rates at around 20% in ecommerce. Reducing that number and helping to manage that process more effectively makes a carrier a much more valuable partner than simply moving parcels around.

If a carrier can provide a digital returns journey, they can start to offer retailers a ready-made returns solution that makes booking a return simpler for customers, and captures customer data and marries it to returns behaviour to offer the retailers powerful insights and ways to manage their returns processes.

That’s perhaps doubly true for the dominant marketplaces like Shopee and Lazada, who would dearly love to enable a consistently great returns offer across their seller base. Providing that solution represents a huge opportunity for the parcel carriers, who can not only capture more of the returns parcel volumes, but make themselves a stickier and more varied service too.

Looking internationally, in the last several years Australia Post was finding that its merchant customers were struggling to manage returns. In partnership with Doddle, they now offer merchants a Collect & Return solution that enables shoppers to book a return digitally through a simple online site, customisable and brandable for any merchant. This makes the returns process much more efficient and streamlined for the consumer and the retailer, and ensures that Australia Post continues to provide a valuable service to its retailer customers.

To find out how Doddle can help you to own the returns problem and become more valuable to retail clients, get in touch today.

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