10 tips for a good returns policy

Having a good returns policy is essential for any online store. It offers clarity to the customer and you can stimulate sales. We tell you how to go about this with 10 practical tips.

In brief, what is the ultimate returns policy?

Many online store owners do not pay enough attention to setting up a good returns policy. Usually they look up a few examples of industry peers and then partially adapt and place them online. This is unfortunately too simple thought. The returns policy offers great opportunities and it is a shame not to make the most of them.

In short, the ultimate returns policy is:

• Easy to find
• Easy to understand
• Inspires confidence
• Stimulates it to buy
  

Finally, it is best to offer free shipping as well, so that the customer does not have to pay for it himself. Furthermore, a good returns policy always includes at least the following essential elements.

Essential elements of a good returns policy

To set up a good returns policy for your web shop, we can identify a number of essential components. Make sure these elements are all included in the returns policy.

1) Return time

Clearly state how long customers have to return the product. This allows your customers to know exactly where they stand. Also observe the legal cooling-off period. By law, online purchases in the Netherlands, for example, are subject to a mandatory 14-day cooling-off period.

2) Return costs

In your return policy, also clearly show what the shipping costs of any returned items are, and who pays for them: your online store or the customer themselves. These types of return conditions are an important part of a good return policy.

3) Difficulty for the customer

How much effort should the customer put into returning the purchased products? The more concerns you can eliminate in advance, the better. Also, by clearly indicating what you, as a web shop, are responsible for and what the customer has to pay attention to, you avoid possible problems later on in the returns process.

4) Return options

It is important for customers to know how a purchase can be returned. For example, you can offer different return options such as shipping with a shipping service like DHL or PDP. You can also let customers bring their purchase to a collection point.

5) Getting money back

How long does it take to process the refund? Is it triggered when the receipt is received by the web shop? Or when the product is back in the possession of the web shop? Make sure this information is included in your returns policy.

Why a good returns policy?

First, 67% of online consumers check a returns policy before making a purchase. Is there a long, confusing story here? Or does the policy seem unreliable? Then the purchase is cancelled in many cases.

Secondly, the returns policy is a good place to put into practice what a brand stands for. Do you stand for sustainability, the very best customer service or the highest quality products? Then let this be reflected in your policy.

Finally, a good return policy keeps the customer happy and prevents unpleasant situations. The clearer the rules, the less chance of misunderstandings and time-consuming customer contacts.

Examples of a good returns policy for online stores

It is advisable to write your returns policy as simply and clearly as possible. This will ensure that you keep the customer experience of returns pleasant.

If you write a confusing and complex returns policy, you can be sure that the customer's experience of the process will be downright poor. It's a good idea to read through the FAQs and returns pages of some successful e-commerce websites for inspiration.

Example 1: Jewellery label My Jewellery

As an example of how it should be done, we have included the returns policy of jewellery label My Jewellery below:

You can find at a glance aspects such as return costs, return options and return address. All without making the information too complex or overwhelming.

Example 2: Fashion label Loavies

The returns policy of online fashion label Loavies is also clearly written and simply presented in 4 manageable steps:

1. Sign up
2. Packing 
3. Send
4. Refund

This makes it easy for customers to understand exactly what is expected of them when it comes to returns.

The Loavies returns policy also clearly shows the shipping options and return possibilities:

Tools to optimize your returns policy

There are several tools you can use to optimize your returns policy and returns process. It is of course up to your specific online store and business model, but often the tools below can make a big difference:

The native returns processing of your e-commerce platform

Depending on which e-commerce platform you use, you will have the option of managing some aspects of returns within the platform itself.

For example, an e-commerce platform like Shopify allows you to manage your returns yourself. For example, you can see the track & trace status of your returns in your dashboard, and send updates and confirmations to your customers.

Apart from these native tools of your e-commerce platform, there are also specific return platforms you can use. These tend to focus on providing the most customer-friendly user experience.

A dedicated returns platform such as Returnista

Returns platforms go one step further and allow online stores and e-commerce managers to get the most out of their returns process. For example, these platforms often integrate with a large number of local and international carriers and offer customers the possibility of easily handling their returns.

A returns platform like Returnista 's also allows you to proactively send status updates on returned products. This reduces the pressure on your customer service by up to 40%, because there are fewer chats and phone calls.

Furthermore, Returnista offers the possibility to have customers exchange their products immediately for another product when they submit a return. This way you retain customers who might otherwise have gone shopping elsewhere.

More on this revenue retention strategy below, let us first go through some tips for a good returns policy.

10 tips for a good returns policy

Want to get started on improving your returns policy? Then consider these 10 tips:

1) Warranty

When a potential customer is considering making a purchase, they undoubtedly have questions about the quality of a product. A good way to remove these doubts is to offer a warranty or repair in case of problems.

An attractive guarantee policy increases the trust among (potential) customers and thus the number of sales. Research by Assurant Solutions, for example, has shown that an extensive guarantee doubles the chance of customers recommending a company or product.

Finally, a good returns policy keeps the customer happy and prevents unpleasant situations. The clearer the rules, the smaller the chance of misunderstandings and time-consuming customer contacts.

2) Make exchanges possible

An important goal of a good return policy is to reduce the number of final returns (and thus refunds). The more customers keep their product or immediately order a replacement product, the more revenue an online store ends up with.

Effective ways to reduce the number of final returns are by promoting exchange promotions and offering store credit. If the customer can order a replacement product directly during the returns process, you prevent losing this customer and having to refund the purchase price. This turns the returns process into a sales process.

3) Sustainability

More than half of consumers take sustainability into consideration when making a purchase. This of course applies not only to the production process, materials and shipping process, but also to the returns policy.

One company that is known for a sustainable returns policy is Patagonia. This brand offers free repair of broken products and sells Worn Wear. By doing so, they exude quality and durability and limit the waste of their product.

Working with sustainable transporters also makes a returns policy more sustainable. For example, opt for last-mile delivery with a bicycle courier or for a carrier that works with central pick-up or delivery points. For example, Returnista works with sustainable carrier Homerr. By mentioning such collaborations in your returns policy, you show that as a brand you stand for sustainability.

4) Community involvement

In addition to sustainability, consumers also value a brand's social commitment. For example, the Edelman Trust Barometer 2020 found that 63% of consumers decided whether or not to become a customer of a company in 2020 based on their social views.

A good way to integrate social responsibility into the returns policy is to handle returned products correctly. Are they thrown away, resold or given away?

Unfortunately, a large proportion of returned products currently end up in the rubbish. When a product is damaged, this is unfortunately hard to avoid. Is a product still usable? Donate it to a local donation centre or charity.

By dealing properly with returned products, you give the customer a good feeling and you also prevent waste.

5) The best service

Put the customer first. The more attractive the returns policy, the smaller the step for the customer to make a purchase.

For example, offer a longer return period and free return shipping so that the threshold for 'just looking at a product' remains as low as possible.

Research from Journal of Marketing found that customers make 58% to 357% more purchases in the two years after receiving their first free returns. Unfortunately, this is obviously not the most sustainable policy.

6) Flexibility

77% of consumers today expect multiple return options. Fortunately, with the right returns software it is easy to offer this flexibility. For example, the customer can choose a carrier, pick-up time and pick-up location.

By offering flexibility in the returns policy, the concern of 'time and effort' in return shipping is removed for the customer.

7) Reward loyal customers

Encourage customers to research the product they want to buy in advance. This prevents unnecessary returns.

To achieve this, you can include certain conditions and benefits in your purchase and returns policy. For example, think of a loyalty programme that rewards customers who order products regularly and return them infrequently.

A good example of a loyalty program is that of H&M. This brand asks customers to become a 'club member', after which they can save points and eventually get a discount.

8) Keep it positive

Every returns policy should have the necessary rules and formalities. Anything can go wrong and the purpose of a good policy is to provide solutions in these cases.

Unfortunately, this serious feature often turns the returns policy into a list of doomsday scenarios. If a potential customer ends up there, this obviously does not have a positive effect on the customer's mood and enthusiasm to place an order.

Therefore, try to keep the returns policy as positive as possible. Write in the form of services and solutions instead of problems, and make sure the customer has a reassuring and positive feeling about the page.

9) Speed is key

While product descriptions or "about us" pages leave room for creative writing, a returns policy should be as simple, short and sweet as possible.

No one has time to read long pieces of text, and potential customers may drop out if the return policy is not clear within minutes. In addition, if return policies are unclear, customers are more likely to contact customer service, and this costs time and money.

10) Findability

Finally, a tip about the placement of the returns policy on the online store.

As explained earlier, everyone is busy. In addition to wanting to read a returns policy quickly, customers also want to be able to find it easily.

Giving the policy a logical place on the website prevents potential customers from giving up the search and abandoning an order or contacting customer service.

Therefore, give the returns page at least a prominent place in the footer, like in the online store of Loavies below, or consider adding a button at the top of the page.

How to turn returns into exchanges

We have already hinted that, with Returnista, it is possible to convert returns into exchanges. Because apart from drafting and offering a good returns policy, you would of course prefer to keep the number of returns as low as possible.

This is not only good for sustainability. It also ensures that your web shop retains its turnover. Did you know, for example, that you can turn up to 40% of returns into exchanges?

This is how the exchange process works:

Exchanges based on live stock

Returnista integrates with your online store so that data from your stock items is always available live. This way you never end up in a situation where you offer an exchange that is actually out of stock. You can only offer what can actually be sent immediately.

Proactively offering exchanges

In as many as 52% of the cases of a return request, it concerns an article that turned out not to be the right size. During Returnista's returns process, the customer is asked what the reason for returning the product is.

In case the customer indicates that the purchase was a wrong size, you can immediately offer an alternative product. All this based on the live stock of your web shop. In this way, you proactively convert returns into exchanges. This way, you retain more turnover and have more loyal customers.

Shop directly with coupons

With Returnista, you can immediately give your customers a coupon during the returns process that is worth as much as the purchase price of their return. These coupons can then be exchanged directly in your online store for other products.

If the customer does not use the coupon, it will expire automatically as soon as the return is processed. In this way, you increase the chance that your customers will still make a purchase in your online store despite the return request. Another smart way to retain turnover and to change the returns process from a cost item to a revenue model.

Need any help?

Do you need help optimizing your returns process? We are happy to help.
Returns are no longer a pain in the ass with Returnista's software. Increase customer satisfaction and reduce your costs with the help of a beautiful returns portal and a complete data dashboard. Do you want to get more value out of your returns process, just like Decathlon, Loavies and ASOS? Then request a demo on our website.