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Retailers risk losing customers if they get returns wrong

By Danielle Wightman-Stone

Jun 1, 2021

Retail

Image: courtesy of Klarna

Over eight in ten (84 percent) online shoppers would stop using a retailer after a bad returns experience, according to new research on shopping trends.

The ‘Rethinking Returns: From Returns to Retention’ report from Klarna suggests that retailers risk losing loyal customers if they get returns wrong, as 83 percent of online shoppers admit to getting frustrated by retailers which have an inefficient returns process, while 82 percent agree that retailers, in general, need to improve their returns capabilities.

The biggest frustrations with returns stem from the inconvenience of slow, out of date or inflexible returns processes, adds the report, with more than a third (36 percent) citing slow refund processes as the most frustrating element of returning items bought online. Other frustrations include having to print off return forms when they don’t have a printer (25 percent), the inconvenience of queuing to return at the post office (23 percent) and not being able to return items in store that they’ve bought online (21 percent).

Over the past 12 months, 21 percent of online shoppers say they’ve reluctantly kept an item they were unhappy with because it was too much effort to return it, and 12 percent have avoided returning items at the post office because it’s difficult to social distance.

For retailers that get returns right, this can serve as a competitive advantage helping to attract new customers and boost customer loyalty. The report states that 84 percent of online shoppers agree they’re more likely to buy from and 86 percent are more likely to come back to online merchants who offer free returns.

However, even a little added inconvenience can come at a cost, as 70 percent of online shoppers stated that if a preferred retailer stopped offering free returns, they might not shop with them.

Commenting on the report, Natalie Berg, retail analyst and founder of NBK Retail, said in a statement: “Consumers often expect a returns policy to mirror that of delivery – fast, frictionless and free – but that’s not always the case. The pandemic has thrust the issue of returns into the spotlight, exacerbating the disconnect between the effortlessness of placing an online order and the inconsistent and often friction-filled experience of making a return. Returns are fantastically out of sync with an otherwise seamless e-commerce experience.

“As we reimagine retail for a post-Covid world, retailers must accept that returns are part and parcel of 21st century shopping and, if managed well, can encourage conversion and drive loyalty among their most valuable shoppers. Retailers can no longer afford to ignore the post-purchase experience.”