Retailers are bleeding money from e-commerce returns, an estimated £5.2 billion a year on average, but they could be bridging the gap by actually lengthening returns policies and returning money back faster to attract more business.
However, data from a survey of the top 100 retailers in the UK suggests that retailers could be missing out on revenue with short, or even hidden, returns policies.
More than half (67%) of UK consumers said they wouldn’t order at an online store if the return policy wasn’t easy to find, while one out of four (24%) UK consumers claim they wouldn’t order at a store if the return period is less than 60 days according to new research.
The survey by e-commerce delivery platform Sendcloud showed that, on average, UK consumers want to wait a maximum of 6 days to get their refund, yet almost half of UK retailers (45%) take up to 14 days to arrange refunds and whilst this is in line with UK law, it doesn’t result in happy customers.
58% of UK consumers claim returns are a big hassle to them, yet just 53% of online stores offer their customers online returns.
Adding to this, only 9% of stores offer consumers the possibility to get their returns picked up at home, whereas 31% of UK consumers would prefer this option.
“Retailers often preconceive the returns process to be a real headache and are sometimes tempted to make their return policies more complicated in an attempt to reduce returns,” said Rob van den Heuvel, CEO, Sendcloud.
“However, the exact opposite is true as our research has proved that a simple and clear return policy is actually key in driving conversions. In fact, what we’ve found is that retailers which offer a longer return period result in fewer returns because customers are less concerned with the product that still has to be returned! All in all, a simple and clear return policy actually pays off,” ven den Heuvel concluded.
Four tips for the ideal return policy
A returns policy is therefore essential to win over consumers. But what do consumers want to see to be convinced?
1. Free returns: it’s no surprise that consumers love the word ‘free’. Even when it comes to returns, consumers prefer to see the retailer take care of these costs. Sixty seven per cent of consumers will not order if they have to pay the return costs themselves.
2. An easy return process: returns can be a lot of hassle, so you want to make it as easy as possible for the customer. Therefore, make sure there are enough return options. Although the majority (43%) would like to drop off a return at a parcel point, 31% would like to see the return picked up at home.
3. An extended return period: although UK law sets 14 days as the minimum period for returning an online purchase, 42 percent of consumers would not buy from an online store if the return period is less than 30 days. One quarter (24%) would not even order if the return period is less than 60 days. Even though it may sound contradictory, surprisingly a longer return period leads to less returns as consumers get attached to their goods.
4. A quick refund: UK consumers are willing to wait a maximum of 6 days to receive a refund for their returned products – much shorter than the legal period of 14 days. A timely refund stimulates repeat purchases and boosts customer satisfaction.