Summary: Our Doddle roundtable looked at real-world returns behaviours and how these could inform carrier strategy.
In ecommerce logistics, we sometimes think of consumers as a single mass, with a broadly uniform set of desires. After all, the statistics tell us about majority opinions and desires. But people are various and unpredictable, and their motivations aren’t always captured by the numbers.
To see past the statistics and remind ourselves of the variations and intricacies of consumer behaviour, we ran our own returns roundtable of Doddle staff. In this piece, we delve into the real-world examples that influenced our behaviours and discuss how carriers could use these insights to better cater to their consumer base.
Divisive in-store returns
Our roundtable started by determining if our participants preferred returning ecommerce items in-store or dropping returns off via PUDO. It’s also the question that had the most varied response from participants, with some loving in-store returns and others hating them.
Marketing Intern Elia Muñoz Cobián said that she returns in-store every time, so that the retailer can resell the item quickly rather than wait for it to arrive at their warehouse.
Elia Muñoz Cobián
“I try to go to the shop because they can sell it in the same moment.”
As an environmentally-minded consumer, Elia doesn’t want her returns being driven around between warehouses before being useful again, something retailers could perhaps tap into with their messaging around returns, encouraging store drop-offs.
Others, like Senior Product Strategy Manager Ayomide Ayofe, expressed a hatred for in-store returns: “I never go to stores to return. I hate queueing. And I hate the fact that I might buy something.”
For Ayomide, the optimum returns experience is about speed and efficiency – and not spending any more money. That means a local drop-off and a fast turnaround are paramount. To cater their PUDO and post office locations for those who are frustrated by queues, posts and carriers can look to automation to reduce waiting times.
Avoiding paid returns on principal
Over the past year, many retailers have changed their policy to charge for returns, unless returned in-store. Such policies are a great way to recover in-store revenue and encourage in-store purchases.
Our roundtable discovered that many would go out of their way to return in-store to avoid even minimal charges, out of principle. Even Ayomide, who hated in-store returns, said she’d return in-store to avoid a £1.50 charge for posted returns, especially if she’s already had to pay for delivery.
Yet, as Content Marketing Manager Ethan Morgan pointed out, most people would not take the same action for an equivalent positive. “If you offered to pay me £1.50 to walk 20 minutes to the store instead of dropping it in a postbox, I’d go ‘What you’re talking about? No way!’”
Psychologically, this is known as negativity bias – we react more strongly to negative stimuli. Here that manifests in more willingness to endure inconvenience to avoid a small charge than to earn the equivalent amount of money. Retailers are using this to their benefit to drive more in-store returns.
However, using more of the stick than the carrot to influence consumer decision-making could have negative long-term effects on consumer sentiment if shoppers feel they’re being made to do something unpleasant or annoying for the sake of a small saving. In the words of Ayomide on a particularly off-putting in-store experience:
“I just hated the process so much that I’ve never ordered from there again.”
Not all consumers will change their returns behaviour just to avoid charges. This, combined with the decreasing presence of free returns in the market, could present an opportunity for carriers to offer more premium returns options. Once the customer has accepted that they’re paying for a return anyway, they’re more likely to spend a little more if it adds value. Marketing Manager Chloe Taylor told us she recently upgraded a paid return to use Royal Mail’s Parcel Collect service.
“The Royal Mail collection was 50p extra versus just taking it to a drop-off point. At that stage, if I’m paying for the return anyway, 50p for the convenience of someone coming to my door is worth it.”
Security plays a key role
Security was one of the main concerns when deciding on a returns location. Several people said they wouldn’t use a closer convenience store and would rather travel further away to a trusted place, like a post office, even at the expense of customer experience.
Jack Sims, Sales Operations Manager
“I’d rather go somewhere that’s more secure, even if I have to walk 5/10 minutes more.”
Poor management in a small number of locations can cause a bigger perception problem. Si Englander, Head of Customer Strategy, told us that in his local newsagent “they just pile the parcels in the corner and give you the handheld and tell you to try to find your parcel when it’s there. You can scroll through everyone’s names and details to find it”.
Understandably, this doesn’t inspire confidence that a return dropped off here will get where it needs to go to trigger a refund. On the other hand, some shoppers are confident that so long as they have some form of receipt to show they’ve handed the parcel over, it’s no longer their problem, which makes security a less pressing concern for returns – though it doubtless still plays a role on the delivery side.
Kitty Poole, CMO
“I feel like once I’ve handed it over and it’s been scanned, it’s not my responsibility anymore.”
Regardless, security of PUDO was a concern that clearly affected our thinking on both delivery and returns, and could be an area of increased focus for posts and carriers looking to drive more PUDO volume generally. Parcel lockers could go some way to addressing this issue, as could better training for store staff, or easier ways to manage large-scale PUDO networks.
Some consumers would rather take the loss than return
If returns processes are too complex, or the distance to drop-off is too far, some consumers will simply not bother. As Jack plainly states: “I just take the hit and throw it into the bin.”
Although fewer returns might sound like a win for retailers, consumers will be less likely to shop with that brand again because they couldn’t be refunded for their last item.
Kitty Poole, CMO
“I’m not going to order from them again. It’s too much of a hassle to drive.”
For carriers, this means two things. Firstly, they need to provide a dense network that is easily accessible to consumers, either near their homes or part of a journey that they frequently make (e.g. to work or a grocery store). Secondly, consumers need simple and efficient return solutions that are easy to navigate and highlight available drop-off locations.
If carriers can provide merchants with better returns solutions, they can improve the consumer experience and thus increase loyalty – making them less likely to boycott a retailer over a bad returns experience. In turn, effective returns solutions become a great selling point for carriers and a way to capture a growing market in returns volume.
Conclusion: Returns should put consumers first
Although we all had different ways of thinking about returns, leading to different behaviours and preferences, we all had one thing in common throughout the discussion: if a returns experience was awful, we stopped shopping with the retailer.
There were a few other key points from our discussion:
Those who favoured PUDO for their returns did so for convenience and ease.
However, price incentives convinced several of us to return in-store, even when we’d prefer to use a PUDO.
Security was a primary concern when selecting drop-off locations – we wanted reputable brands and visibly well-run locations to feel confident in our refund.
If the returns process is too complex and the drop-off options are far away, some of us will not even bother to return the item.
Carriers aiming to capture increasing returns volumes face multiple challenges, with retailers increasingly using charges to incentivise in-store returns, complex merchant returns journeys failing to highlight local drop-off points, and consumer concerns about security.
Overcoming those will require carriers to offer digital returns services which reduce the chances of consumers dropping their merchants due to a poor returns experience.
They will also need to highlight the convenience of PUDO for returns, and reassure shoppers of the security of their return through digital communications and well-overseen networks where location performance can be tracked and improved systematically.
5 ways to digitise your returns process and increase profitability
Discover the 5 easy ways to digitise your returns process for better returns efficiency and ROI.
5 Changes We Predict in eCommerce Delivery & Returns in 2024
Our predictions for 2024 in ecommerce delivery and returns, plus a roundup of our 2023 predictions.