In the last few years, many fashion e-commerce shops have started advertising free product returns in the hope of increasing conversions, and as a consequence customers have now acquired a “buy now, return later” mentality.
It’s great for shoppers to have the flexibility to try their new purchases at home before making a decision. However, it can be a headache for retailers.
Returns are always a problem: they cost time and money, and can clog up e-commerce logistics. On the other hand, a good product returns management offer opportunities: a transparent return process helps keep customers satisfied, leading to higher conversion rates. As an online fashion retailer, you should make sure that your return process is as simple, efficient and flexible as possible.
In this article, we will show you how to reduce returns on Shopify and how to deal with the return process itself.
1. Be as flexible as possible with your return policy
A return policy is essentially a marketing tool and a big part of the product returns management. When a potential customer is making a purchase decision, especially if it’s a major purchase, your return policy can be the deciding factor in whether they actually pull out their credit card.
This is even more important if you don’t compete on price. If you sell fashion items that can be seen as similar to your competitors in terms of looks and price point, it will be more important to differentiate yourself with your service portfolio.
Some ways to do this are fast shipping or customer service, but a relaxed return policy is a great opportunity to offer something more.
To put this in perspective, one study published by the Kellogg School of Management found that consumers were more likely to make a purchase with retailers that had favorable return policies than those that didn’t. What’s more, those consumers were even willing to pay a higher price for their individual items if it meant they could return them if necessary!
Another aspect is that by offering your customers a short time frame to send back their items, you are creating an unnecessary sense of urgency. They will feel pressured to complete the return as soon as possible.
Try to adopt the opposite approach by offering a 60 or even 90 days return policy (check out IKEA’s 365 days return policy) and leverage the so-called Endowment effect, a bias that causes individuals to value ‘owned’ objects much higher than what they are actually worth. The longer they keep that new purchase, the less likely they are to actually send it back. Interesting, right?
2. Identify the reasons behind returns
When your users request product returns, do you try to understand the causes and consequences?
Knowing the triggers behind returns, their monetary value and the percentage of returns by product and customer is indeed central to improve the service, implement effective strategies and reduce losses.
To give you some insights, research published by Shopify indicates that 52% of returns in fashion e-commerce are due to sizing issues. If that’s your case, nothing easier than integrating a sizing solution like Sizefox in your product pages, to help your shoppers make the right choice before having to make a return.
3. Optimize your product page
It’s important that your product page comprehensively and consistently describes the product you’re offering. The user must immediately understand what you are selling.
- Improve the texts: are they clear and realistic? Work on your copywriting and don’t be shy when it comes to setting expectations. Just make sure you formulate it the right way. You know that blouse runs small? It highlights curves and waistline, for a confident and bold look!
- Check the images: how is the quality? Can the user understand the type of fabric? Do they show the garment from all sides? By using 360° photography, you can show products from different angles and thus help customers make better purchasing decisions. A good option for a Shopify App that offers 360° photography is 360 Product Spin by Spin Studio.
- Is the size guide, if present, clear enough? Have you considered moving from a size chart to a full-fledged sizing solution? (Read how Mammut decreased their return rate by a staggering 20% after implementing Fit Finder).
The main point is that the online user’s experience must be comparable to the offline one, giving the shoppers all the tools to evaluate the product properly.
4. Keep serial returners under control
Segment your shoppers to figure out the frequency of their purchases, their return rates and ultimately their AOV. By identifying the ones which are more likely to return garments, you might find out you don’t want to send them yet another discount after all. Amazon took it further than that and decided to ban undesirable customers altogether. Maybe a bit extreme, but you get the gist.
5. Make sure you offer an exchange instead of a return
Most businesses lose on returns, but that’s not necessarily the case with exchanges. If you can get a customer to exchange one item for another instead of getting a refund, you’ll see a difference in your profit margins. A refund means you’ll lose money on the shipping cost as well as the profit you made on the original order, but with an exchange, you won’t lose the value of that original purchase.
When a customer wants to exchange an item, they are usually satisfied with the shopping experience offered by your brand. They simply chose the wrong product, whether it’s the wrong size, color or design.
The benefit of this is that you still have the opportunity to change the experience and create a loyal customer, if you can meet their expectations the second time around. A great Shopify App to offer different return options is Returngo, which also supports return labels management.
6. Shopify return policy – how to set it up
One of the great things about Shopify is that you can quickly and easily add your own shipping and return policy from within the platform itself. To do this, follow these steps:
Within the admin panel, navigate to the Settings/Legal option. You will see that the software allows you to use a specific template or enter an already created policy. Do not underestimate the importance of writing a customized one according to your type and the operation of your ecommerce shop. For a quick overview, try the Refund Policy Template, it’s free to use and easy to test.
Once you have added the title and adjusted the formatting, you must save the text. From then on, it will be automatically added to the bottom of the payment page and cart of your online store.
7. Best practices for your return policy
Keep in mind that a return policy is essentially a legal text! Here are some tips to take into account when writing or adapting a return management text:
- Do not place this document in hidden pages of your website. For many shoppers, this is the first text they read before placing their order. Therefore, add it in prominent places, as this helps to generate confidence in your online store. Some examples:
- On the footer of your Shopify shop
- In the FAQ section
- In the product page
- In the shopping cart
- During the checkout process
- Return time: This is a really important piece of information that you must make clear in the return policy.
- Return process: explain clearly and in detail the steps that customers must follow to return any item. You can use images and number the steps, this way customers will always know where they are in the process.
- Documentation for the return: If you ask your customers to fill out a form for the return of the package, you have to tell them exactly where they can find this form and how to fill it out. In addition, only the data necessary for the return should be requested.
- Refunds: The customers usually have the possibility of requesting a refund to the same payment method by which they made the original payment. However, It is a good idea to give your customers alternatives, such as exchanging their returned item for a different product in the same amount or offering them an in-store purchase coupon.
- Return costs: You need to make it clear who will bear the costs of the returns. Once you decide whether the company will be the one to assume the costs or whether it will be the customer, you have to make it clear, so that customers do not feel cheated.
Product returns management is no doubt a hot topic within fashion e-commerce, but it’s up to you turning the problem into an opportunity. As usual, the best solution for any issue is to prevent it, and with a bit of planning (and lots of accurate data), you’ll be able to see an impact in your return rates.
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