E-commerce stores have been delivering the best of products and services to their customers for a long time. The increasing competition requires them to adopt innovative techniques to retain customers.
But sometimes, the stores end up bearing the negative consequences of it. As in the instance of product returns which costs the e-commerce sector heavily.
By 2020, online return deliveries are estimated to cost businesses $550 billion. While return rates to brick and mortar stores are around 8%, this jumps to around 25% for items bought online.
40% of the shoppers buy items with the intention of returning some of them. 47% of the shoppers won’t buy an item if they have to pay for return shipping. 20% of online retailers raise prices to compensate for the expense of e-commerce returns.
Related: How to Grow your eCommerce Store?
Among the most frequently returned online products are clothing and shoes with they being returned in more than half the times of purchases.
Then come electronics with 42%, then accessories/jewelry with 30%, then health and beauty items with 22%, and lastly entertainment-related products with 21%.
There are several reasons why products are returned online and the cost of the returned merchandise due to these reasons is huge.
- Defective/poor quality: $162 bn
- Bought wrong item: $99.3 bn
- Buyer’s remorse: $88.7 bn
- Found better price elsewhere: $83.4 b
- Gift returns: $64.1 bn
- Wrong size: $62.4 bn
- Return fraud: $ 28.2 bn
- The item didn’t match description: $ 6.1bn
- Item delivered late: $4.6 bn
When we talk about buyer’s preferences, 82% of buyers prefer free online returns, 69% prefer returning products bought online at a physical store, 61% prefer refund options other than store/site credit, 54% prefer a longer return window, and 10% believe return policy is not important.
68% of consumers review the return policy before making a purchase, 67% of consumersare satisfied with clear and easy-to-learn return policy, 60% of consumers are satisfied with the ability to find a retailer’s return policy during the search and browse process.
All of these statistics are on the buyers’ side. Let’s look at a few statistics on the sellers’ side.
57% of sellers dealing with returns have a negative impact on the daily running of a business.
33% of sellers offer free returns but offset the cost of this by charging for delivery. 20% of sellers increase the price of products to cover the cost of returns.
Here are some of the ways to reduce product return rate:
- Transparent and hassle-free return policies
- Segment the returners
- High-quality product visuals
- Offer try and buy
- Use augmented reality
- Expand the period of return
- Work on customer feedback
- Data-Driven e-mails to Prevent Returns
Careful analysis of these e-commerce product return rate and statistics can help you in planning and amending the return policies of your e-commerce store. Thus, ultimately it will help you in minimizing product returns.