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During the pandemic, global e-commerce saw a sharp increase in sales, attracting even those who traditionally prefer to buy in-store. Of course, this rise had implications for online product returns, too.
Optoro1, a leading provider of returns technology that helps brands manage, process and resell returned merchandise, has seen a 20% decrease in average weekly returns volumes during the recent stage of the pandemic2. Similarly, Returnly3, the digital return platform for direct-to-consumer brands, saw e-commerce return rates fall by 21% in the weeks following mandated shutdowns4.
The drop is likely attributed to consumers wanting to avoid extra stress during the pandemic; to return a product, they must leave the house to visit the local shipping store, a risk many are reluctant to take during lockdown, especially when advised to self-isolate. Additionally, many online retailers have extended their returns window by up to 90 days to accommodate the new situation – return rates are predicted to rise later, as the deadline approaches. Some have also introduced more flexibility, allowing online orders to be returned in-store once they reopened.
This postponement is expected to cause an avalanche of returns in the future. “We are thinking of Covid as another Black Friday for returns – after the market opens,” says Returnly’s CEO and founder, Eduardo Vilar5. With a potential backlog in returns looming, COVID-19 could be the catalyst to fast-track returns technology, says Amit Sharma, CEO of post-purchase tech provider Narvar6. “Customers will expect more from brands and retailers. Some of the conveniences that they are seeing on the delivery side will eventually permeate returns.”7
Last year, Narvar introduced a service that lets US customers of brands including Levi’s and Sephora drop off their returns at Walgreens stores. The drugstore has been allowed to stay open during the pandemic and, as a result, Narvar has seen its customer base double. It appears to be a win-win situation – customers have a more convenient returns process, whilst the brands can provide a better service, with fewer expenses.
Elsewhere, technology companies are working on solutions that will improve the returns process for e-commerce sellers. Retail software provider Detego8 has recently expanded its RFID (radio-frequency identification) technology for use in the returns process. It allows fulfillment centers to scan items inside their return boxes, which makes the process quicker and easier.
With the current boom in e-commerce, many industry forecasters are predicting that consumers who are new to online shopping will retain their habit even post COVID-19. Now is the time for your business to consider the delivery and returns service it offers – and where improvements can be made.
So, what can your e-commerce business do to ensure its returns process is as efficient as possible?
The returns service your business offers is a crucial investment for success. Treat it as an important part of your customer service: satisfied customers become repeat customers, and what customers want is a simple, transparent and preferably free returns service.
DHL's own research17 shows that when an e-commerce business offers an easy returns service, it encourages higher basket spend amongst customers. DHL Express's experts can help you integrate a seamless returns solution to your e-commerce checkout. Contact us today to get started.
1 – Optoro
2 – The Impact of COVID-19 on Consumer Returns, May 2020
3 – Returnly
4 – The Impact of COVID-19 on Consumer Returns, May 2020
5 – Eduardo Vilar, Vogue Business, May 2020
6 – Narvar
7 – Amit Sharma, Vogue Business, May 2020
8 – Detego
9 – The Impact of COVID-19 on Consumer Returns, May 2020
10 – The endowment effect, Wikipedia
11 – Narvar Consumer Report, June 2017
12 – Lancerto
13 – Invesp
14 – Chain Store Age, May 2020
15 – GymShark
16 – Discover.DHL, June 2018
17 – The 21st Century Spice Trade, DHL