Everyone knows the customer return experience has a tremendous impact on customer retention. Nine out of 10 customers will not do business with a retailer if the return experience is negative. The opposite also holds true; those same customers will remain loyal if the return experience is a positive one. Interestingly, however, return policies vary widely from one industry to the next and from one company to another and those that are not consistently re-evaluated may result in lost revenue. While some e-retailer policies generate increased revenue, others may send potential customers fleeing to competitors. So the question is: which companies have the best policies, and is yours one of them?
Here are nine key questions to ask:
1. Does your company's return policy help drive sales or cause shopping cart drop-outs? Of course it's critical to know the answer to this question; however, many simply don't. Check shopping cart drop-out percentages and engage with industry experts, internal data and get feedback from customers to recognize whether drop-outs are related to your stores return policy. Gain a competitive advantage by acquiring a consistent flow of metrics that will enable you to gauge this critical aspect of your business.
2. When was the last time you reevaluated your company's return policy? In the world of ecommerce, a "few years ago" is the equivalent of a lifetime. Periodic reviews are critical and a best practice of top ecommerce companies. Carriers hungry for this growing business are continually offering new solutions, some of which can help reduce costs, delight consumers and even transform returns into a profit center. I discuss a new innovation from the USPS later in this article that may be of interest.
3. What are your company's financial goals as it relates to returns? Make a profit? Break even? Lose money? While this decision is largely driven by competition, a new and unique offering by your company can provide a boost to sales.
4. Do you have complete visibility of returns data? Knowing consumer behavior as it relates to returns can help formulate a more effective marketing effort that increases sales and reduces returns. The more information retailers can collect from a customer, the better chance of understanding the reasons for returns and reducing fraud.
5. When was the last time you checked what your competitors were doing? This should be done frequently, and of course the goal should be to ensure your policy is in line with or better than theirs. On occasion, buy products from the competition to gauge the experience and be sure to offer one that is at least as good or better. Also, return at least some of what you buy so that you can get a real feel for the entire process.
6. How soon after a customer decides to return an item(s) is the inventory updated? Knowing what item(s) are on their way back and when they'll arrive helps companies increase profits and provide better customer service. Return information should be captured the moment a customer decides to initiate a return, not days or weeks later.
7. Does your company's return policy require the generation of paper and return labels that don't get used, don't get recycled and simply clog our landfills? Try reducing paper and labels in the supply chain, including packing slips that no one pays any attention to and return labels that never get used. Generate return labels only when you know they'll get used. This will help reduce costs, benefit the environment and attract new customers. In this case going green can help your company make more green!
8. Are you paying your carrier for every return label included in each shipment? I often find companies are paying $.50 for each return label placed in the carton at shipment execution, whether it gets used or not! Many don't even realize it's happening. Check your invoices, you might be surprised.
9. Does your company offer a mobile return solution that differentiates it from the competition? In 2013, one-third of ecommerce orders were initiated from a mobile device. Consumers who buy on a mobile device want to return the same way!
In case you are wondering, here are the top four reasons for returns:
1. Returned Merchandise - The product did not meet the customer's expectations (wrong size or color, not satisfied with quality, wrong product shipped, etc.). The customer may have simply changed their mind.
2. Repairs - The product was damaged.
3. Recalls - The retailer requests the customer return due to a manufacturing defect.
4. Recovery - The product is usually an old electronic device that is returned to either recover/recycle its useful parts.
The USPS is now offering Scan-Based Payment (SBP). This service enables USPS return labels to be printed and included in the carton at shipment execution (or, for the green-minded, transmitted electronically after a customer decides to place a return). The shipping charge occurs at the point the carton is scanned. Scan-based returns offer merchants convenient access, network reach, technological capabilities, tracking, competitive prices and electronic payment. SBP enables merchants to:
Leverage the flexible label print option so the customer can generate a returns label online.
Enable the merchant call center agents to generate a return label and send it to the customer.
Monitor the status of returned merchandise with built-in USPS tracking.
Access detailed reporting of piece level returns activity.
Improve the customer returns experience by receiving returned items faster.
In addition, the USPS reduces time in transit for their customers through the streamlined payment process using an average uniform price or a fixed price multiplied by the number of packages that are scanned as "Delivered." This eliminates the need for manual handling.
There are five USPS service level return options: Priority Mail Return Service, First- Class Package Return Service, Ground Return Service, Critical Mail Return Service and Parcel Return Service (PRS) Full Network. There are three Scan-Based Payment shipping label options which are available through:
A cloud-hosted API.
A cloud-hosted shipping label tool.
Customer-generated shipping labels.
In addition to charging return postage based on scanning vs. when the label is printed another unique feature the USPS offers is called "proximity routing." This addresses the return package on demand to the merchant's closest returns receiving location, shortening the return package distance it needs to travel and therefore helping to drive down return costs. A perfect fit for Omni-commerce.
Never to be outdone, both UPS and FedEx, along with many other shipping carriers, routinely add new return solutions too, so be sure to speak with your carrier representatives and stay informed. So perhaps it's time to Re-Think Returns, again. I hope this information helps your company Ship Better, Save Money and Return Better!
To get started using the USPS' new innovation, contact Peter Manning, ecommerce expert for the USPS in the New York Metro area. Peter can be reached via email at peter.l.manning@usps.gov or by calling 212.330.5052. If he can't help, he will direct you to someone who can.
Here are nine key questions to ask:
1. Does your company's return policy help drive sales or cause shopping cart drop-outs? Of course it's critical to know the answer to this question; however, many simply don't. Check shopping cart drop-out percentages and engage with industry experts, internal data and get feedback from customers to recognize whether drop-outs are related to your stores return policy. Gain a competitive advantage by acquiring a consistent flow of metrics that will enable you to gauge this critical aspect of your business.
2. When was the last time you reevaluated your company's return policy? In the world of ecommerce, a "few years ago" is the equivalent of a lifetime. Periodic reviews are critical and a best practice of top ecommerce companies. Carriers hungry for this growing business are continually offering new solutions, some of which can help reduce costs, delight consumers and even transform returns into a profit center. I discuss a new innovation from the USPS later in this article that may be of interest.
3. What are your company's financial goals as it relates to returns? Make a profit? Break even? Lose money? While this decision is largely driven by competition, a new and unique offering by your company can provide a boost to sales.
4. Do you have complete visibility of returns data? Knowing consumer behavior as it relates to returns can help formulate a more effective marketing effort that increases sales and reduces returns. The more information retailers can collect from a customer, the better chance of understanding the reasons for returns and reducing fraud.
5. When was the last time you checked what your competitors were doing? This should be done frequently, and of course the goal should be to ensure your policy is in line with or better than theirs. On occasion, buy products from the competition to gauge the experience and be sure to offer one that is at least as good or better. Also, return at least some of what you buy so that you can get a real feel for the entire process.
6. How soon after a customer decides to return an item(s) is the inventory updated? Knowing what item(s) are on their way back and when they'll arrive helps companies increase profits and provide better customer service. Return information should be captured the moment a customer decides to initiate a return, not days or weeks later.
7. Does your company's return policy require the generation of paper and return labels that don't get used, don't get recycled and simply clog our landfills? Try reducing paper and labels in the supply chain, including packing slips that no one pays any attention to and return labels that never get used. Generate return labels only when you know they'll get used. This will help reduce costs, benefit the environment and attract new customers. In this case going green can help your company make more green!
8. Are you paying your carrier for every return label included in each shipment? I often find companies are paying $.50 for each return label placed in the carton at shipment execution, whether it gets used or not! Many don't even realize it's happening. Check your invoices, you might be surprised.
9. Does your company offer a mobile return solution that differentiates it from the competition? In 2013, one-third of ecommerce orders were initiated from a mobile device. Consumers who buy on a mobile device want to return the same way!
In case you are wondering, here are the top four reasons for returns:
1. Returned Merchandise - The product did not meet the customer's expectations (wrong size or color, not satisfied with quality, wrong product shipped, etc.). The customer may have simply changed their mind.
2. Repairs - The product was damaged.
3. Recalls - The retailer requests the customer return due to a manufacturing defect.
4. Recovery - The product is usually an old electronic device that is returned to either recover/recycle its useful parts.
The USPS is now offering Scan-Based Payment (SBP). This service enables USPS return labels to be printed and included in the carton at shipment execution (or, for the green-minded, transmitted electronically after a customer decides to place a return). The shipping charge occurs at the point the carton is scanned. Scan-based returns offer merchants convenient access, network reach, technological capabilities, tracking, competitive prices and electronic payment. SBP enables merchants to:
Leverage the flexible label print option so the customer can generate a returns label online.
Enable the merchant call center agents to generate a return label and send it to the customer.
Monitor the status of returned merchandise with built-in USPS tracking.
Access detailed reporting of piece level returns activity.
Improve the customer returns experience by receiving returned items faster.
In addition, the USPS reduces time in transit for their customers through the streamlined payment process using an average uniform price or a fixed price multiplied by the number of packages that are scanned as "Delivered." This eliminates the need for manual handling.
There are five USPS service level return options: Priority Mail Return Service, First- Class Package Return Service, Ground Return Service, Critical Mail Return Service and Parcel Return Service (PRS) Full Network. There are three Scan-Based Payment shipping label options which are available through:
A cloud-hosted API.
A cloud-hosted shipping label tool.
Customer-generated shipping labels.
In addition to charging return postage based on scanning vs. when the label is printed another unique feature the USPS offers is called "proximity routing." This addresses the return package on demand to the merchant's closest returns receiving location, shortening the return package distance it needs to travel and therefore helping to drive down return costs. A perfect fit for Omni-commerce.
Never to be outdone, both UPS and FedEx, along with many other shipping carriers, routinely add new return solutions too, so be sure to speak with your carrier representatives and stay informed. So perhaps it's time to Re-Think Returns, again. I hope this information helps your company Ship Better, Save Money and Return Better!
To get started using the USPS' new innovation, contact Peter Manning, ecommerce expert for the USPS in the New York Metro area. Peter can be reached via email at peter.l.manning@usps.gov or by calling 212.330.5052. If he can't help, he will direct you to someone who can.
