By Barley Laing, UK managing director at Melissa
Unfortunately, as costly as they are, returns aren’t something that retailers can avoid, with customers wanting to return purchases for a variety of reasons.
However, one area of returns retailers can control is in preventing ‘return to sender’ scenarios, which is caused by poor quality customer data – particularly address data.
Customer provided data in the mobile age
A major issue for retailers is a growing reliance on customer provided data in the mobile age. Customers typing in their contact information on a small screen are much more likely to mistype, with any mistakes leading to at best a possible delay with the delivery, at worst, it’s returned to sender.
But it’s not only an issue with customer provided data – call centres make mistakes too when inputting customer details. So it’s perhaps not surprising that approximately 20 per cent of addresses entered online contain errors such as spelling mistakes, wrong house numbers, and inaccurate postcodes.
These mistakes not only cost retailers money in handling the return, storage, re-contacting the customer and in re-shipping, but in reputation, because an unhappy shopper with a poor experience can have an impact on customer retention.
The simple answer to prevent non-deliverable returns is for retailers to have access to accurate and verified customer data. The best time to ensure accurate data is at the customer onboarding stage, when they are about to make a purchase. Then, on an ongoing basis, use data cleansing tools to ensure the contact data remains up to date and therefore valid.
As a matter of course all retailers should have access to autocomplete functionality to ensure accurate address data is collected – regardless of where their customer is located globally. These tools will automatically reveal a suggested correct version of the address as the customer completes an online contact form, enabling them to select one that’s not only accurate but easily recognised, and correctly formatted for their country location. Another benefit of autocomplete is that as well as preventing mistakes caused by fat finger syndrome, it reduces the number of keystrokes required when typing an address by up to 70 per cent. This speeds up checkout and reduces shopping cart abandonment.
It’s also advisable to ensure data quality and accuracy by verifying a customer’s entire record. This is something that’s particularly important if you are selling a high value item, because it also helps to prevent fraudulent purchases. A key part of this involves undertaking know your customer (KYC) checks to confirm that the person you are engaging with is who they say they are. To do this it’s important to source a data partner with access to trusted reference data from sources such as the credit agencies and the electoral roll, so they can use it to cross-validate a consumer’s data for proof of address – importantly connecting the individual to a specific address. Additionally, phone numbers can have live status and registered user checks, and email address verification can take place with mailbox validity checks to protect the merchant from spam traps. All this activity needs to take place in real-time so there’s no delay and therefore impact on the customer experience.
Having accurate customer data puts retailers in a position to go further in improving logistics and reducing shipping costs. They can do this by adding geocodes to customer addresses that deliver precise geographic (rooftop) latitude and longitude coordinates. Using this information it’s possible to calculate the shopper’s distance from distribution points, enabling a real-time calculation of shipping costs. This allows retailers to present a number of price levels depending on how fast the customer wants delivery. Furthermore, using geocoding helps to power sales and marketing efforts such as sales clustering.
Retailers, particularly those in e-commerce, must embrace best practice with address data quality in 2020, to not only cut back on return to sender issues but also ensure happy customers in a highly competitive marketplace. And if they also go to the extra effort of ID verification and geocoding as an extension of this process they will be richly rewarded.