The Post Return Experience phenomenon
Returns are a fact of life for retailers. And with online shopping through the roof, the pain will be that much greater. Whether families gathered for the holidays or not, some people gave gifts the recipients didn’t want, adding to the already sizable cost of returns.
While consumers return 30% of items bought online, they aren’t all gifts, of course. Shoppers purchase millions of items knowing they’re going to return them before their orders arrive. People often buy multiple colors, styles, or sizes to see what works best, intending to send the rest back. Unfortunately, retailers must throw away 25% of returned merchandise. That means retailers have to eat the cost of the goods and all the shipping.
Add all this activity up, and the cost and logistics of returns become a significant consideration factor in profits and losses. Many tactics, large and small, can reduce costs, smooth out logistics, and improve customer experience to ensure that returns lead to more purchases and more profits. Focusing on providing a great post-return experience is an essential element.
Most customers do not care about the cost retailers incur from returns. A full 89% note that they’ll stop shopping with a brand if they have a bad return experience. With Amazon and Walmart+ looming large, retailers have little choice but to bend over backward to create an easy and friendly return process. That’s the case for gifts or personal purchases.
There is a silver lining. Nurturing customers (and gift returners) during the return process can provide payoffs later in the form of loyalty and additional purchases. Focusing on the customer experience while creating new connections requires a renewed focus on personalization, segmentation, and communication.
Create new segments
Segment returners based on their customer status, such as first-time purchasers or repeat customers. First-timers need to connect to the brand, so elements like customer satisfaction show that the brand cares. Both Amazon and Shoedazzle personalize a new customer’s first purchase experience from their very first email. This primes the customer before they even receive their package. Amazon’s email has a link to manage orders and returns in that first note.
Repeat customers are already loyal, which should be acknowledged. Personalized messaging shows the total amount saved or gives them high fives for their loyalty status (and maybe even a preview on sale items they can buy using their return money). These relevant messages will keep customers engaged even after they’ve completed their return.
Deliver the right information about returns
Return messages are often generic order processing notifications that don’t offer enough of the right information. People want to know when they will get refunded if any credits can be applied online or in-store, and how it affects elements like loyalty points. This personalized messaging conveys the correct information and captures the customer’s attention and leaves the door open for more messaging such as recommendations.
For example, if they noted that they returned boots that were too big, ask customers if they’d like to purchase the smaller size or might like similar items that might better match what they were looking for. Retailers can also use this messaging to gather new information. One example is asking to send SMS notifications about order and return status in the future. And don’t forget to make it easy for shoppers to find the right return message. Frequent returners may have several similar emails in their inbox that they have to sort through. Identifying each order, either in the subject or email copy, saves them the need to click through to the site.
And speaking of frequent returners, not all returns represent a bad purchase. When customers buy four pairs of gray jeans and send three back, they’re shopping with a “try-on” mentality. It’s an excellent opportunity to offer complementary product recommendations for the styles they’re trying on.
Don’t let customers go just because they send something back. Use win-back messaging at the right time. Based on customer value or loyalty, retailers can determine if it’s worth offering promotions or credits to recent returners. By accessing data about recent shopping and returns, retailers can personalize such messages even further. Someone who returned a coat and then browsed more coats is highly likely to respond to an offer for 10% off winter outerwear. But make sure to exclude returned products from any post-purchase communication, such as emails requesting product reviews and retargeting ads.
Make the customer feel good about the return
Returns, while a necessary part of shopping, are not nearly as fun as purchasing. Think about the positivity in other marketing content and use the same approach in return interactions to offset boxing things’ annoyance and bring them to UPS. Add wording to transactional emails like “Congratulations! Your return is processing, and your money is on its way back to your account.” Make it easy and fun to track returns with the same colors and branding as promotional emails, with as much customization and personalization as possible. Use email to give people short cuts to elements like reprinting a mailing label or checking their loyalty points. Steve Madden offers 15% off a customer’s next purchase if they share preferences.
No one likes returns. Not the retailer, not the customer, and not the recipient of an unwanted gift. But that necessary transaction can be made much more appealing and engaging when informative, personalized and positive. It’s a chance to capture a lot of new loyal customers. Make the extra effort to create a good return experience this holiday season, and count on dividends you will get in 2021.