In this post we touch on ecommerce best practices for returns, or, to be more accurate, best practices for mitigating returns.
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Returns are the margin masher, the profit punisher. All that great work to source a great product, list it and promote it to be found and ordered, deliver it and say goodbye to the end-to-end process, only for the blasted thing to come back, together with a whole load of work to do. What started out as a profitable transaction ends in a refund, a credit note, or a replacement sent out, at your expense. You might also be in line for a poor review, or at best a good review about how hard you worked to right the wrong.
Let’s assume for the moment you’ve weeded out the serial order-returner who wants to harm your business. Let’s also assume your business model is robust enough to cope with the culture of customers habitually ordering a bunch of items knowing full well they’re going to be returning at least some of them. This leaves three main buyer motivations for why the item you delivered was returned. We’ll address each of them in turn. These are: it was the wrong item; it was broken on arrival; it wasn’t what they were expecting.
They ordered product A and you delivered product B. Maybe it was a slight error, the wrong size or colour for example. Maybe you delivered altogether the wrong item. No matter, it’s still going to come back.
If this is the case, then the error originated during the pick, pack and dispatch process. It was wrongly picked, the error wasn’t spotted during the checking and packing process, or it didn’t end up getting packed and the order went out the door. We covered these quality control aspects in our post on sales order processing and operational efficiency, which is where you need to tighten up if this is an issue.
Assuming you process the correct order, the customer discovers that the item they ordered is broken or damaged. Either they could tell before they opened the package, especially if they ordered glassware, or the problem only becomes apparent when they get inside the package. Either way, it’s coming back.
You’re going to get the occasional broken or damaged delivery, no matter how well you protect your products during the packing stage. Once the package leaves your premises, you’re trusting to the process of your carrier to get the order through their various nodes and into the hands of the recipient. You get what you pay for, and while you’re often absorbing the cost of shipping in ecommerce, it pays to go with the good carriers, rather than the ones who are going to throw a package over the side gate if no-one’s home.
Item Not What They Were Expecting
Perception is everything, and sometimes when your customer opens their delivery and sees the physical item they find it’s not aligned with their expectations. Too much of a misalignment and they’re going to send it back to you.
This throws the focus back to the listing process, and the things you can do when you create the listing to mitigate issues happening weeks later. Try and use the maximum number of photos allowed on the marketplace or your web store. For example it’s up to 12 photos on eBay. Show different angles and shots of the constituent parts of the product. If there’s a subtle difference in a car part between 2 car models, get that clearly on the photo. You want your customer either buying the right product or not buying it as it’s the wrong one for them.
Your descriptions need to be as, well, descriptive as possible. Have a look at your installation instructions, or those of your supplier. Could they be improved? Is it worth posting a short video on your YouTube channel for installing or assembling your high value and popular items? If you’re experiencing a high rate of return on a specific item or items, set a rule within your system to hold the order until your customer service team has contacted the buyer to double check the order. It will save you in the long run and your buyer will appreciate you for it.
Look at the data
Finally, when it comes to refunds, like any part of the process that directly impacts your bottom line, it’s prudent to be proactive. Analyse your refunds to uncover patterns with high returned products, patterns that you can tie to specific suppliers, internal processes, shippers or destinations. After all, forewarned is forearmed.
Of course, you can always get in touch with us to discuss how best to reduce your returns in your unique business.