Retailers are taking a stand against the ‘phantom economy’ created by growing returns volumes and it looks set to be a hot and divisive topic in 2019.
For the last few years doing everything you could to make life easy for returners seemed to be received retailer wisdom. But in a striking departure from this strategy Amazon has started banning serial returners. And they’re not alone.
According to the latest research from Brightpearl, 45% of retailers are set to follow Amazon’s lead and ban ‘serial returners’ in the near future. In some sectors the proportion is even higher, with two thirds (67%) of consumer electronics retailers and over half (55%) of fashion retailers planning the move.
In a seismic shift in attitudes, only 7% of retailers now disagree with the principle of banning serial returners.
So what has brought about this shift? And is it justified and wise?
Certainly something has to be done. Barclaycard’s research puts the current value of the returns created ‘Phantom economy’ at a staggering £76bn. And with a quarter of retailers saying they’ve seen a dramatic increase in returns over the last two years, that figure looks set to rocket still further.
A situation in which almost half the amount consumers spend ends up being refunded by retailers is clearly untenable. But so too is risking the wrath of hard-won consumers when returns have become a battleground for brand loyalty.
Over two thirds (69%) of online shoppers have now come to accept free returns as ‘standard’ while 41% of retailers see their returns policy as a key selling point and 37% say it’s crucial to customer satisfaction.
So surely there’s a middle ground? The way forward can’t just be to pit returners on one side and retailers on the other side of an increasingly blood battle-ground. We believe this five-point charter could provide a cleaner way forward:
1. Set clear parameters around any serial returners ban and be totally transparent about your policy. Over half (56%) of consumers believe banning prolific returners is fair. So your shoppers will back you as long as you make it clear that doing this is what will enable you to retain free returns for those who play the game fairly
BUT don’t let 2019 become the year that you become consumed by serial returners. Invest as much time, resource and tech in saving returns costs in more positive ways:
2. If you’re a fashion retailer, invest in AR tech to offer your shoppers best in class virtual changing rooms that up the chances that what they buy suits them
3. Incentivise the use of ‘wish lists’ (10% off when something has sat on your wish list for 5+ days) to encourage thoughtful, considered purchasing
4. Team up with a third party C&C provider to offer on the spot changing rooms for your C&C shoppers. Doddle shoppers can try on their ASOS purchases at Debenhams allowing them to collect and return in a single trip. Convenience for consumers and higher likelihood of a full price second sale for ASOS – the ultimate win-win
5. Invest in smart, frictionless returns systems such as our Facebook Doddlebot (that asks shoppers a series of questions to generate a returns QR code). With slick systems in place you can increase the percentage of items you receive back still in their full price sales window
Serial returners are the bane of retailers’ lives but they do enough damage already. Don’t let them destroy a culture that essentially works.
For a parallel look to high street parking. By all means clamp the prolific user of disabled spaces or spaces that block vital trade access doors but don’t deter regular shoppers that are supporting local business in the process.
So take a stand, but in taking that stand don’t spite your customers or your own business. Just send a message to the minority that 2019 is the year things change…
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