Omnichannel Returns Index Can Help You Improve Your Returns Management

Today’s shoppers are more demanding than ever – especially when it comes to returns transactions. They expect retailers to handle returns quickly, with flexibility and consistency, and to always take a proactive approach to customer satisfaction. If any aspect is found lacking, consumers are very likely to move on and take their business elsewhere.

Ecommerce and omnichannel retailers are particularly at risk. Research shows that shoppers return online purchases 3 to 4 times more often than purchases made in brick-and-mortar stores. What can you do to compete effectively and minimize returns in this shopper-savvy landscape?

The Power of Benchmarking

Start by examining your returns strategy against industry benchmarks to determine areas in need of improvement. The 2023 Omnichannel Returns Index report analyzed the returns strategies of 128 retailers from 9 industry segments to identify the digital attributes that set Returns Leaders apart from Laggards. The report, published by Incisiv in partnership with Appriss® Retail, assessed 80 different attributes across four areas of the customer journey that directly impact returns. Many of the attributes are considered “table stakes” that address universal shopper expectations. Retailers offering “differentiating” experiences lead the way in exceeding current and emerging consumer needs and expectations to positively impact key KPIs.

The report names Overall Omnichannel Returns Leaders, as well as Leaders in two sub-categories: Pre-purchase and Post-purchase. Let’s first examine the key attributes that leading retailers offer to help shoppers purchase the right items in the first place and avoid returns altogether. Then we will delve into the features that post-purchase leaders provide to ensure customer satisfaction and continued shopper loyalty during and after a return transaction. 

Omnichannel Returns Leaders’ Pre-Purchase Attributes

Shoppers have a lot of options when purchasing online. The ease and simplicity of making a return if a purchase doesn’t work out is often a deciding factor in a shopper’s purchase decisions. Yet, most retailers don’t consider the impact their returns strategies may have on a consumer’s purchase decisions.

Case in point: just 13 of the 128 retailers assessed for the report excelled in pre-purchase functional capabilities. That’s just about 10% of the retailers in the study that lead the way by utilizing pre-purchase strategies to minimize returns. These retailers each have built a solid base of table-stake capabilities with differentiated frictionless fulfillment capabilities that help them minimize returns and protect their revenue.

So, what are the attributes that set the 13 Omnichannel Pre-purchase Leaders apart? The Omnichannel survey assessed performance in two main areas to identify differentiating attributes:

1. Product Content and Digital Experience features that inform shoppers
2. Availability of Returns Policy and Information at crucial decision points

Product Content & Digital Experience

Helping shoppers search for, discover, and purchase the right product is an important component of reducing returns. Exhaustive product information and digital tools that assist with product selection are key. Consumers expect retailers to provide clear sizing charts, demo videos, multiple product views, available inventory, and online reviews and ratings on the product page. In fact, the study found that 93% of shoppers are likely to read reviews before buying a product.

However, the retailers that excel in providing pre-purchase selection support also offer sophisticated digital tools such as those shown in the chart below. But as you can see, there is clear room for improvement. In all cases except one, fewer than 50% of retailers offer the tools that improve purchase selection and thereby reduce returns. 

Return Policy & Information

Retailers have been offering self-help options for several years now, with nearly 100% adoption of clearly defined and documented policies for returns, exchanges, and refunds. According to the report, 74% of shoppers read a brand’s return policy before buying online, and 58% of consumers expect retailers to offer smooth, no-questions-asked returns across all channels. To best serve their shoppers, retailers need to create comprehensive, yet flexible returns policies and make them easily accessible during the purchase process.

The leaders in this area offer shoppers additional conveniences to ensure returns transactions do not end up harming the customer experience. Again, the adoption of these differentiating attributes is still quite low.

Omnichannel Returns Leaders’ Post-Purchase Attributes

A returns transaction can make or break the consumer-retailer relationship. Consumers already feel an element of negativity when having to make a return. After all, the purchase they hoped to be “just the thing” didn’t work out and now they have to go through the “hassle” of returning it. If the actual returns process is truly a hassle, the consumer will likely shop elsewhere in the future. The report found that 73% of shoppers choose a retailer based on a return experience.

Retailers need to focus on making the returns process as easy as possible to protect the relationship with the consumer. Most are adept at providing the table stakes attributes, but only 14 of the 128 retailers assessed for the report were named Leaders in post-purchase functional capabilities that maximize the shopper and return experience to minimize the impact of returns on revenue.

What post-purchase attributes set retailers apart? The Omnichannel survey post-purchase analysis assessed performance in two main areas:

1. Returns & Refund Processes that best serve consumers
2. 360-Degree Service offering consistent assistance and tracking of returns across all channels

Returns & Refund Process

No one likes to make a return, but retailers can go a long way toward making the experience as pleasant as possible. Consumers look for flexible return windows, expedited processing, no returns fees, and easy drop-off or pick-up of returns. The availability of digital return labels and free return shipping are especially important. The study found that 50% of shoppers are likely to switch to another retailer if they have to pay for returns.

The retailers that lead in this area understand the impact of returns on overall customer lifetime value. They provide additional conveniences to ensure shopper satisfaction. But, like the pre-purchase categories, there is plenty of room for improvement.

360-Degree Service

The omnichannel returns experience needs to be just that – omnichannel. In other words, consumers expect to experience the same policies and high-quality customer service across all your selling channels. If shoppers encounter friction when returning items, it will lead to dissatisfaction and reduced loyalty. On the other hand, 81% of shoppers indicate that a seamless customer experience boosts the possibilities of making a purchase.

Table stakes in this category include support via chat, phone, or a virtual assistant; availability of multiple return options, online tracking of return status; and, probably most importantly, fixing the issue in one go. 

How does your returns performance compare?

If you are ready to become an Omnichannel Returns Leader, take a minute to download the full Omnichannel Returns Index report to learn more about each category and compare your performance to the industry standards. A customized version of the report is also available to qualified retailers. The report will assess your company’s performance against the benchmarks to help you identify areas ripe for improvement where Appriss® Retail can help. Contact us today to learn more.