Retail | January 10th 2016

Why online retailers should embrace returns

This week, a study by Barclaycard has been shared showing that three in ten shoppers deliberately over-order and then return unwanted items, with one in five ordering multiple versions of the same item.

Working at Collect+ means that this information isn’t new to me, nor is it surprising. After all, isn’t this how people have always shopped? Before ecommerce, consumers would head to their local high street, purchase several items and try them on at home before returning any unwanted pieces the next time they went in to town. In the modern era, this simply means retailers unpacking boxes in a warehouse instead of putting them back on the rack.


20% of items are returned which means that 80% of online sales are kept, which is pretty impressive. With pure play retailers reporting big hikes in profit at the end of April, it can hardly be suggested that this is doing retailers much harm. Instead, they should be embracing this side of ecommerce and here’s why.

Recent research published in Womens Wear Daily (WWD) reported that the average returns customer spends 15% more than new customers. I believe that this is because the retailers are able to gather a lot of data on their customers based on what they buy and return. They are able to build an almost exact model of what their customer is looking for including size, colour, style and budget. When you return an item, it’s likely that the retailer will respond with an email letting you know that they’re refunding you along with a personalised selection of new items that they think you’d like to buy. This return customer accounts for up to 30% of total sales, according to WWD.

It’s not a new idea to include the cost of shipping in to the price of a garment, how else would they cover that cost? Consumers increasingly don’t want to pay for delivery, and yet there is no such thing as a free delivery. Transporting an item across the country (and maybe back again) comes with associated costs and those charges are built in to the retail model. Most fashion retailers know to include the cost of returns in to their approach as this is vital for customer satisfaction. Customers do not like to pay for returns and 81% of shoppers are more likely to buy online when easy returns are offered. Retailers know how the process works – it’s an ongoing cycle between sale and returns.

Online retailers should be embracing returns as a means of better understanding their customer. They are gathering increasing amounts of data which could never have been dreamed of in a traditional bricks and mortar store. Customers should be encouraged to reap the benefits of online shopping which makes everything more convenient for them and this includes returns. Use the data gathered on these consumers to make the whole process easier, more convenient and more customer focused.

January 10th 2016 - by @CollectPlus