6 Ways to Reduce Ecommerce Return Rates

Now more than ever, product returns are all part and parcel of the ecommerce delivery experience. And as frustrating as returning items can be for customers, they pose an entirely different set of problems for online businesses. From processing additional packages, issuing refunds and trying to keep customers sweet throughout the whole process, returns take up time that can be better spent elsewhere.

But without an effective returns strategy – and policy, for that matter – a business is going to be dealing with a lot more returned items that it needs to. To help minimise the number of returns (and unhappy customers) your business deals with, we’ve come up with some top-notch tips to get you started.

What is an ecommerce return rate?

To get a better handle on what’s being returned to you, understanding your ecommerce return rate – the frequency that customers return items to your online store – can help a lot.

Keep in mind, however, that ecommerce return rates don’t exist in a vacuum. You should also take things such as consumer behaviour and returns management strategies too.

Once you begin to understand the reasons behind your returns, you’ll then be in a better position to start minimising them.

How to calculate your eCommerce return rate

Thankfully, calculating your return rate is a simple formula. Essentially, it’s a measure of how many units were returned within a certain period against the total number that were sold.

So, say if you sold 20,000 units within six months and had 5,000 units returned, your return rate would be:

5000 / 20,000 x 100 = 25

• ecommerce return rates by industry

According to Shopify UK, the average return rates by industry are as follows:

• Apparel: 12.2%
• Auto Parts: 19.4%
• Beauty: 4.3%
• Department Stores: 11.4%
• Drug/Pharmacies: 1.6%
• Footwear: 9.1%
• Hard Goods: 3.8%
• Home Improvement: 11.5%
  Housewares: 11.5%
• Sporting Goods: 7.6%

How to reduce returns for your ecommerce business

1. Put a liberal returns policy in place

Customers are unlikely to part with their cash if they know your returns policy is a breadcrumb trail of awkward steps and tedious hoop jumping.

Also known as a customer-centric returns policy, a liberal returns policy gives your customers the confidence that should an item not be to their liking, they can return it just as easily as they bought it. A business that’s seen to be generous is one whose customers will trust. And later down the conversion funnel, that trust then translates into conversion.

Don’t be tempted use your returns policy as a way of saving money. In a world of free returns, many consumers are unlikely to make a purchase in the first place if they have to pay for return shipping.

Along with free returns, you might also want to extend the returns window from the usual 28-30 days to something longer like 45-90. Customers are more likely to form an attachment to your products if they have a longer time to return it – which means they’re less likely to return it!

2. Use quality imagery and descriptions in your product pages

If your products look like one thing on your site but arrive at your customers’ homes looking like something else entirely, then your returns are likely to skyrocket. Keep those disappointment levels to a minimum by making sure your customers know exactly what they’re ordering.

Optimise your product page descriptions by using language and imagery to your advantage. For example, product descriptions should feature key information and USPs written to entice your audience. Use a headline to grab their attention, sum up essential features using bullet points, and finish up with a call-to-action designed to get your customers moving ahead with their purchase.

As for imagery, make sure you’re including plenty of different angles of the item in question that reflect real-world usage. If it’s an item of clothing, use a model to illustrate how it fits, for instance. Let your customers familiarise themselves with your products by offering 360-degree views, a zoom feature and videos of the product in action, if possible.

3. Use customer reviews to your advantage

Customer reviews on your product description pages are a great way of boosting your product’s social proof. By utilising subjective opinions, there’s a whole range of individual-specific insights that your customers can use when deciding to make a purchase. It’s also a great way of seeing if customers are having issues with your products, information which can then be used to improve the listing, the marketing of the item or even the product itself.

If you’ve struggled to get reviews in the past, then offering rewards and incentives – such as 10% off their next order – are a great way of encouraging customers to throw in their own two cents when it comes to previous purchases.

4. Offer exchanges as well as returns

If a customer wants to exchange the same article of clothing for another size, or they’d prefer a different product of equivalent value but you only offer returns, then it might be time to rethink. By restricting yourself to returns only, customers must wait until the return process is complete before their issue is refunded. By offering exchanges too, no more money has to change hands, and customers are less likely to go elsewhere to find the product they desire.

5. Analyse each return

Every return you receive and process should be a lesson. Once you begin analysing your returns in more detail, you can start to get a picture of why items are being returned.

In an Excel spreadsheet, record your returns and clearly highlight the reason for their return. At the end of the month, take a look at any pain points which might have emerged, so you can start to make the necessary changes.

For instance, if the wrong product or size is frequently being received by customers, then clearly, there are issues within your pick, pack and despatch process. From here, you can begin to investigate which part of this process isn’t working in the way it should. Once the issue has become clear, you can seek to improve it.

6. Clearly display delivery estimates

Nowadays, people need immediate gratification. They want news at their fingertips. They want results in an instant. And they want whatever they ordered today as soon as possible.

An order that arrives the week after a customer needed it isn’t going to cut it. Along with letting the customer down, it’s another return you’ll have to deal with.

By clearly marking the delivery window on the product page, however, customers are far more likely to make a purchase, knowing full well what they should expect. The positives are two-fold too. Along with minimising returns, you can prevent pesky “where is my item?” emails along the way.

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