You can approach the return process in two ways: as a potential cost or as a customer retention opportunity. If you let your customers pay the return costs, you minimize your own costs. On the other hand, if you offer free returns, you are investing in a long-term relationship with your customers.
Nowadays, consumers expect to be able to return online purchases free of charge. If you keep your customers satisfied, the chances of a repeat purchase are considerably higher.
Below, we have outlined why free returns are so important and we'll give you three tips on how to offer them in the best way possible.
Why should you offer free returns?
You could say that returning products is something to be avoided at all costs. However, it is a fact that returns are unavoidable, especially when it comes to online purchases.
For example, take the fact that 52% of all returns take place because a size was too big or small.
These types of return requests are, by the way, perfectly solvable by offering exchanges.
Furthermore, recent research shows that 42.2% of consumers will not buy again from a company where a return failed. So you should not see returns as a potential cost item. On the contrary: a successful return can actually generate a returning customer.
So in asking the question whether you should offer free returns, take the following facts into account:
Return requests in e-commerce are inevitable
More than half of the times it concerns a purchase that does not fit
Failed returns result in lost customers
Most likely your competitors offer free returns
3 tips for offering free returns
To get you started, we have put together the following 3 tips for offering free returns in the right way:
Communicate free returns everywhere on your website
Make returns extra easy for everyone
Making returns extra easy for everyone
By following these three instructions and implementing them in your working method and online store, you can take great steps forward to improving your customer loyalty.
1) Communicate free returns everywhere on your website
We have mentioned before that you need to make sure a good returns policy is easy to find. Everyone is busy, and on top of wanting to read a returns policy quickly, customers also want to be able to find it easily.
Research shows that 67% of online shoppers check the returns policy before making a purchase. So why not make your returns policy easy to find, and attractive too?
Actually, you should view your returns policy as a kind of marketing tool. A generous returns policy, including free returns, can convince the customer to make a purchase because it removes friction.
This means that if you choose to offer free returns, do so on prominent locations on your website, including at least:
At the top of your online store homepage
In the footer of your website
On your product and product pages
2) The returns process is an opportunity to gain loyal customers
Did you know that customer loyalty and the likelihood of a repeat purchase increases with each successive purchase?
After a first purchase, 27% of your customers make another one. After a second purchase, 45% of these customers make another one. And after a first, a second, and a third purchase, even 54% of customers make a follow-up purchase.
In the light of this information it would be a shame to lose a potential loyal customer early on simple because you made them pay for the return costs.
Returns can increase the lifetime value (LTV) of your customers
Think of it this way: returns allow you to stay in touch with your customers. The returns process creates customer contact moments in the post-purchase phase of the customer journey. Each customer contact moment is one in which you have a chance to impress the customer.
If you fail to impress a customer who wants to return an item (for example by maling them pay for the return cost), you may lose him or her forever, making the lifetime value of this customer drop to zero. This is without including lost marketing costs.
However, if you make sure that the return process is smooth, and that in this unfortunate situation you take care of the return costs, you may have lost the purchase and return costs, but actually increased this customer's LTV.
Here, too, there is a difference in mentality: do you focus on the short term or do you set your eyes on the horizon by looking at long-term growth?
Returns help you to gather data and improve your offering
If keeping customers happy is not enough reason to offer free returns, consider the following:
You can get incredible value from data insights gathered during the returns process. If you use a returns platform like Returnista, it is very easy to gather all kinds of data.
For example, do you have certain SKU's that are being returned more often than average? Returnista collects these insights in an easy-to-understand way, and also allows customers to indicate why they are returning their purchase.
All this will help you steer your company in the direction of offering better products. This is all made possible by offering free returns.
So, approach these returns both as a service to your customers and as a learning opportunity for your e-commerce business.
3) Make returns extra easy for everyone
It is probably clear by now that offering free returns is a good idea. However, it is important that you make this extra easy for everyone. By this we mean your customers, your customer service team and, for example, the logistics department.
The returns process is a holistic, multifaceted process that involves a great deal of work. At Returnista we have perfected a returns platform that helps you centralize all this.
Here are some of Returnista's functionalities that allow you to optimize all aspects of the returns process:
Fully automated. You don't have to worry about it anymore. This saves you and your team a lot of time.
Optimized for exchanges. Our platform encourages exchanges - up to 3x more than you can expect without Returnista.
Data-driven processes. Real-time insights into your return flow help you quickly steer and optimize.
Essential integrations. Whether your online store runs on Shopify, Magento, or Lightspeed, it doesn't matter. We also work with the largest carriers in Europe.
International returns. With Returnista you are not limited to the Netherlands. We can help you both within and outside the EU.
You cannot avoid returns. So it is better to embrace them and use them as an opportunity to grow and improve your e-commerce business.
Offering free returns is a good start, and the tips above will help you along the way. But using a returns platform like Returnista's can streamline your entire returns process.