4 ways to lower your returns this peak season
Whenever organizations are looking to optimize their delivery processes, they are usually thinking purely in terms of items leaving their warehouse or store and traveling to the customer. Reverse logistics is rarely the focus.
However, returns are inevitable, no matter how good your e-commerce platform, shipping software, or delivery strategy is. And during peak season, with Black Friday, Christmas, and the January sales all close together, the number of returns can quickly mount.
Handling returns efficiently during peak season can be challenging. Last year’s sales figures suggest one in every three shoppers return their Black Friday purchases, amounting to around 30 million unwanted goods. The problem seems to be getting worse too, with the number of returns increasing by 16% globally last year between Black Friday and Christmas. The issue isn’t expected to go away either, with the total value of online returns projected to reach $550 billion across 2023 as a whole.
Given that it is impossible to avoid returns completely, it is essential for organizations to manage their returns effectively – to reduce costs and improve the customer experience.
Good returns and bad returns
Although returns are to be expected, not all returns should be treated equally. There are “good returns” and “bad returns.” Recent insights from retailer Asos’ financial results explain this in more detail.
Good returns are those that help brands acquire new customers and play a crucial role in boosting customer loyalty. Bad returns are those that are requested by regular returners – often for avoidable reasons. These returns damage a brand’s profitability – especially if they are offered to customers for free.
Research suggests that some customers make online orders with the intention to return them already in mind. In fact, as many as 30% of shoppers deliberately over-purchase with a view to returning some or all of the items. This could be because they don’t fit, don’t look as expected, or simply that the customer has changed their mind.
Given the huge number of returns brands should expect over peak season, it is hugely important that they have a return strategy in place. This should encompass every aspect of reverse logistics, including a role for their shipping software. Only by taking a holistic approach to the customer experience from checkout to delivery, to sending items back, can brands prioritize good returns and minimize the bad ones.
How to better manage returns
As mentioned earlier, the scale of returns a brand can expect during peak season is substantial – but it doesn’t have to be overwhelming. Below, we’ve included four tips on how to handle your returns in a way that satisfies your customers and your logistics team.
Customers now expect a number of different delivery choices, so why shouldn’t they receive the same variety when it comes to returns? Brands should offer multiple returning or exchanging options for their customers (such as returning in-store or via various PUDOs) to make the return process as stress-free as possible.
As many as 83% of shoppers admit they check the returns policies and only shop again with a retailer if it has one they are satisfied with. They are likely, at least in part, to be concerned with how long they have to make the return. Be sure to extend the return window and offer more flexibility to your customers to ensure they receive the desired level of service.
Another way to better manage returns during peak season is to focus on the impact reverse logistics has on your warehouse personnel. Improve efficiency and ease the workload for warehouses by embracing technology, optimizing your use of space, and adopting lean inventory management.
Finally, make your returns policy as transparent as possible. Communicate clearly with customers about your return and exchange policies to lower customer support inquiries, reducing the manual burden on your customer-facing staff.
Your data-driven strategy
Much is made of the importance of data for a smooth-running delivery strategy but did you know it’s just as important when it comes to returns?
Analyzing your current data before or after peak season will help you discover patterns and areas for improvement in your return strategy. To promote data-driven decision-making in logistics, 79% of chief supply chain officers are developing training programs in 2023. This is hardly surprising given the importance of data to both reverse logistics and shipping software generally.
At Paazl, we have recently released a new feature that offers an overview of return volume over time within our powerful data dashboards. This feature enables businesses to look for patterns and trends to help predict return volumes or identify recurring issues. It gives them greater visibility into their returns volume – something that will be appreciated by delivery drivers, warehouse personnel, and customers alike this peak season.