# data[].attributes.body
(Store images, n.d.)
Corporate Asda. n.d. Store images. [online] Available at: <https://corporate.asda.com/photos/store-images> [Accessed 2 December 2021].

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(Company facts, n.d.)
Corporate Asda. n.d. Company facts. [online] Available at: <https://corporate.asda.com/our-story/company-facts> [Accessed 1 December 2021].

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Asda Stores Ltd was founded as a supermarket committed to offering shoppers Every Day Low Prices. We have stayed true to our heritage, never losing sight of our goal of ‘Save Money. Live Better’.

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(Tech,2016)

Tech, A., 2016. Why is the Fitting Room so Important in Retail Analytics? - Alert Tech. [online] Alert Tech. Available at: <https://alerttech.net/fitting-room-important-retail-analytics/> [Accessed 29 November 2021].

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Relatively speaking, the fitting room is one of the smallest areas of any retail store. These unobtrusive rooms are often tucked away in the back, and as a retailer, you could easily forget all about them. That is, until you understand the importance of this small-but-mighty area of the store.

For example, did you know that fitting rooms are key to increased sales and decreased returns? Let's look at why the fitting room is crucial to retail performance.

[Tweet "The small-but-mighty fitting room is crucial to #retail performance."]

Retail Purchases Begin and End in the Fitting Room

Whether it's because they need an outfit for an event or a special occasion, or just because they feel ready for something new, people want clothes that make them feel good.

A promotion or a clever window display might get a shopper in the door, and the selection and pricing might convince them to pick an item up off the rack. However, until they know how that particular piece of clothing makes them feel when they're wearing it, no sale is a done deal.

All apparel purchases have one thing in common: " How does this make me feel? "

[Tweet "All apparel purchases have one thing in common: ' How does this make me feel?' "]

And it's not just the way the makes them feel. There's also the whole shopping experience. Your associates have the opportunity to make personal connections with customers who visit your physical stores. For instance, when an associate knows that a customer is shopping for clothes for a beach vacation, they can share the customer's excitement about the upcoming trip and make better upsell and cross-sell suggestions.

(Upselling and cross-selling is one reason why, when a customer has used a call button to get personalized service in the fitting room, there is a three-fold increase in the size of their basket.)

Well-Managed Fitting Rooms Lead to Decreased Returns

For a moment, put yourself in the shoes of your customer. Have you ever been frustrated when you're ready to make your purchase decision - i.e., ready to try something on? Long fitting room lines, difficulty finding a sales associate, or issues with the physical comfort of the room are some common barriers.

When faced with such barriers, what do YOU do? If it's a store that's relatively convenient to get to, you may decide that the ease of a return means that you'll make a purchase before you try on the clothing.

This is great when you're the customer, but not as a retailer. Items that don't make it to the fitting room inevitably have higher return rates. Merchandise returns cost around $270 billion dollars every year in lost sales.

Given what we know about the way fitting rooms affect return rates, there is something you can do about this.

[Tweet "Returned merchandise costs #retailers $270B every year! Here's how to reduce returns"]

The fitting room is one area where traditional retailers maintain a significant edge over eCommerce. Online retailers experience return rates of nearly one in five due to issues with fit. But in a brick-and-mortar store, the ability to see and touch clothes results in return rates that are less than one in ten. When a customer has tried their purchase on first, return rates are even lower.

Fitting Room Metrics Help Motivate Staff

Since most associates work at least partly on commission, they're clearly incentivized to serve customers well. Fitting room technology provides metrics that associates - and management - can use to get feedback on how well they're doing.

When your fitting rooms are equipped with such technology, and you're collecting statistics on how well your fitting rooms are being serviced (e.g., how long it takes staff to respond to fitting room calls), you're not just helping to ensure excellent service for customers. You're identifying opportunities for training and development, and receiving concrete metrics to determine which sales associates are superstars, and which ones have some room for improvement.

Conclusion

When it comes to increasing sales, decreasing returns, and motivating sales associates, there's a major source of opportunity in the humble fitting room. You can begin to improve all these areas with a fitting room system that provides access to key fitting room performance indicators.

The cost of not having such a system, or the associated metrics, can be significant, as it includes the burden of returns as well as the cost of lost sales.

How to Collect Retail Data, and What to Do with It

[xyz-ihs snippet="TOFU2-Retail-Analytics"]

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Why is the Fitting Room so Important in Retail Analytics? - Alert Tech

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Relatively speaking, the fitting room is one of the smallest areas of any retail store. These unobtrusive rooms are often tucked away in the back, and as a retailer, you could easily forget all about them. That is, until you understand the importance of this small-but-mighty area of the store.

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(Wiles, 2020)
Wiles, T., 2020. Four FREE Ways for Boutiques to Increase Sales - Where and Share. [online] Where and Share. Available at: <https://whereandshare.com/4-free-ways-for-boutiques-to-increase-sales/> [Accessed 29 November 2021].

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Four FREE Ways for Boutiques to Increase Sales - Where and Share

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It's important to understand the customer journey from the moment a customer enters your store. Based on an AlertTech study, the average conversion for the customers that walk in your store to the fitting room is 25%. The average conversion rate from the fitting room to the register is 67%.

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(YouGov, 2021)
Yougov.co.uk. 2021. How often are British and American shoppers visiting the grocery store? | YouGov. [online] Available at: <https://yougov.co.uk/topics/food/articles-reports/2021/01/28/grocery-store-frequency-us-gb-poll> [Accessed 29 November 2021].

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As with so many of our habits right now, the way we shop has been impacted considerably by the coronavirus pandemic. For some, a trip to the grocery store or supermarket has become the highlight of a monotonous week. For others, it's a journey they take on only with great reluctance.

Following up on our recent piece on what kind of grocery store people around the world prefer to visit, in this piece we're taking a quick dive into how often Americans and Brits shop for food.

In the UK, the most popular frequency is weekly, with almost half of all Brits (48%) choosing to do a big shop to see them through the week. Across the general population, the next most popular option is only to shop when it's necessary and more than a fifth (22%) purchase groceries this way.

But looking across the age groups, habits vary significantly. A weekly stop is most common among 45-54-year-olds. More than half of this age group (56%) are creatures of a weekly habit and they are also the least likely to tell us that they have no routine at all (5%). By contrast, only 39% of 18-24-year-olds shop weekly - although it is still the most common choice of this age group.

It's the over-55 age group who are most likely to tell us that they only shop as and when required (25%) - something that's perhaps a result of a more flexible lifestyle in the later years of life. This kind of shopping certainly grows in popularity from the age of 25-34 upwards.

Very few shoppers of any age shop daily. This is data continuously collected over the past twelve months and this low rate of daily shopping is likely to reflect guidance in light of the pandemic to shop only as frequently as absolutely necessary.
In the US, there is a slightly different story. Here, fewer people overall shop on a weekly basis (39% compared to 48% of Brits). As a corollary, a greater proportion of Americans leave shopping until when they feel it's necessary (29% v 22% of Brits).

Just like in Britain, however, once people hit the 25-34 age group, they become more and more likely to revert to shopping only when required as they get older. This group swells from 25% of 25-34-year-olds to 37% of those aged 55+.

Those who don't do a big shop, but rather 'buy bits and pieces when required' are a smaller group in each country, representing both 7% of all Americans and all Brits. This small but significant group remains fairly steady across all age groups in both countries.

Methodology: The data is based on the interviews of 8,425 adults in Great Britain and 9,243 adults in the United States. All interviews were conducted online between January 2020 and January 2021 and results have been weighted to be nationally representative of each country.

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How often are British and American shoppers visiting the grocery store? | YouGov

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As with so many of our habits right now, the way we shop has been impacted considerably by the coronavirus pandemic. For some, a trip to the grocery store or supermarket has become the highlight of a monotonous week. For others, it's a journey they take on only with great reluctance.

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(Halzack, 2016)
Halzack, S., 2016. The surprising psychology of shoppers and return policies. [online] The Washington Post. Available at: <https://www.washingtonpost.com/news/business/wp/2016/01/22/the-surprising-psychology-of-shoppers-and-return-policies/> [Accessed 29 November 2021].

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Shoppers throng Brea Mall in Brea, Calif. (AP Photo/Jae C. Hong)

January is prime time for returns in the retail industry, the month where shoppers show up in droves to trade in an ill-fitting sweater from grandma or to unload the second and third "Frozen" dolls that showed up under the Christmas tree.

This post-Christmas ritual has always been costly for retailers, comprising a large share of the $284 billion in goods that were returned in 2014. But now it is arguably becoming more urgent for the industry to think carefully about return policies, as analysts say the rise of online shopping is bringing with it a surge in returns. The return rate for the industry overall is about 8 percent, but analysts say that it is likely significantly higher than that online, since shoppers are purchasing goods without seeing them in person or trying them on.

Against that backdrop, researchers at University of Texas-Dallas sought to get a better handle on how return policies affect shopper behavior and, in turn, whether lenient policies such as offering a lengthy period for returns actually helps or hurts a retailer's business.

Overall, a lenient return policy did indeed correlate with more returns. But, crucially, it was even more strongly correlated with an increase in purchases. In other words, retailers are generally getting a clear sales benefit from giving customers the assurance of a return.

But of course, not all return policies are created equal, and that's where the findings get interesting. The team examined several potential characteristics of a return policy: Time (such as whether you must return within 14 days or 90 days); money (whether or not you get a full reimbursement); effort (whether you must provide a receipt or other forms); scope (whether even sale merchandise is eligible for return); and exchange (whether you're limited to getting store credit for your return).

One surprising finding: More leniency on time limits is associated with a reduction - not an increase - in returns.

This may seem counterintuitive, but researchers say it could have varying explanations. Ryan Freling, who conducted the research alongside Narayan Janakiraman and Holly Syrdal, said that this is perhaps a result of what's known as "endowment effect."

"That would say that the longer a customer has a product in their hands, the more attached they feel to it," Freling said.

Plus, the long time frame creates less urgency around the decision over whether or not to take it back.

"Since they don't feel pressure to take it right back to the store, they kind of sit with it and live with it and say, 'Well it's not that bad," Freling said.

(If you've ever found a blouse lurking in the back of your closet with the tags on it months after you bought it, this is probably a familiar feeling.)

The researchers found that leniency around the time you have and the amount of money you can get back are most effective in increasing overall sales. Making it easier to return, with no questions asked, for instance, also increases purchases, though not quite as much.

So why does any of this matter? Retailers are desperate to figure out how to curb costly returns in the era of online shopping. This is why you see them rolling out website features such as apparel fit predictors, and it's why they're hounding you via e-mail to write a review of your latest purchase. They're trying to create an environment in which their customers buy the right thing on the first try.

But re-evaluating return policies could be another lever to pull as they aim to get this balance right. The UT-Dallas research suggests that it is complex to pinpoint an optimal return policy. Limits on scope, or what items are eligible for return, were found to be powerful in cutting down the number of returns, even if they weren't especially effective in raising overall sales. So, a retailer might have to choose what's more important to the business: Boosting overall sales or cutting the number of returns.

The researchers, who conducted a meta-analysis of 21 research studies that together include 11,662 subjects, suggest that retailers might also want to consider creating more complex return policies that have different rules for different products.

"Depending on whether it's a durable good or a consumable good, whether it's high-fashion or fast-fashion, those different segments of the market have different reasons for buying and they have different concerns for risk and quality," Freling said.

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The surprising psychology of shoppers and return policies

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January is prime time for returns in the retail industry, the month where shoppers show up in droves to trade in an ill-fitting sweater from grandma or to unload the second and third "Frozen" dolls that showed up under the Christmas tree.

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(Underhill,2009)

Underhill, P., 2009. Why We buy (The science of shopping). 2nd ed. New York: Simon And Schuster, p.183.

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(Keay, 2021)
Keay, L., 2021. Cost of living: What's got to give?. [online] Sky News. Available at: <https://news.sky.com/story/cost-of-living-whats-got-to-give-12443822> [Accessed 29 November 2021].

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From skyrocketing petrol and gas bills to ever-increasing rail fares and restaurant receipts, this year the UK is seeing a considerable increase in living costs.

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(About us | George Supplier, n.d.)
Supplier.george.com. n.d. About us | George Supplier. [online] Available at: <https://supplier.george.com/about-us> [Accessed 25 November 2021].

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Welcome to the fast-paced and rewarding world of George, exclusively at Asda, where we have led the changing face of British fashion over the past decades, and we are now one of the largest fashion retailers in Britain.

Launched in 1989, George is now sold in over 580 stores and through George.com with over 2m customer transactions per week combined.

George is a household name and has built up a reputation for quality, style and value. We strive to save our customers money and to offer the best value, affordable and inspirational clothing for their family. To demonstrate our continued commitment to providing affordable quality clothing, that is made to last, we launched the first 100 days satisfaction guarantee on all of our George school uniforms. In 2010 this was extended to all of our clothing.

At George we respect the importance of our select and talented worldwide supply base. To support both our suppliers and our George UK office, we have the benefit and support of our in country offices, which are based in Bangladesh, Turkey, China and India.

As a business we recognise the importance of ethical sourcing and protecting the environment, and we always aim to do the right thing. To meet our commitment, we employ a team of ethics specialists, both at our headquarters in the UK and on the ground in the countries where our clothes are produced. Their role is to ensure continuous progress towards our goals, including monitoring results of independent audits.

When our customers choose George products, it' is important that they know they are not only getting unbeatable quality and value for money, but that this doesn't come at an unacceptable cost to workers. How we treat the people that produce our clothes is a fundamental part of how we do business.

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Launched in 1989, George is now sold in over 580 stores and through George.com with over 2m customer transactions per week combined. George is a household name and has built up a reputation for quality, style and value. We strive to save our customers money and to offer the best value, affordable and inspirational clothing for their family.

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Following today's release of ASDA Q3 figures for 2020,
Thomas Brereton, Senior Retail Analyst at GlobalData, a leading data and analytics company, comments:
''ASDA's monotonous Q3 results expose why the supermarket needs incoming new owners Issa brothers and TDR Capital (to be completed in H1 2021) to bring in a fresh view. The 2.7% rise in ex. fuel l-f-l sales and 72% sales increase across ASDA.com and George.com is - relative to likes of Tesco and Sainsbury's - mediocre.

It is not that ASDA's results are poor, or even that actions over the last quarter (e.g. unveiling a new sustainability store or removing plastic fruit and veg bags from stores) will be detrimental to future performance. It is more that such trials and initiatives are simply following in line with what other supermarkets are doing (or did a year ago), as if ASDA has cobbled together a strategy based on actions of its rivals, rather than assessing its own position in the market and how best to change to meet consumer demands.

There is hope that, under the new owners, ASDA will receive the attention that it needs to compete with the wide array of competitors that are moving towards an EDLP strategy and with the expanding discounters. This includes a promise of £1bn investment over the next three years (predominantly in price and supply chain), as well as the possibility of the Issa brothers' knowledge of convenience retailing enabling ASDA to readjust the model and adapt to convenience-driven shopping missions. In the meantime, ASDA must become more proactive, and ensure that it puts its 'test and learn' motto into action quicker."

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Arriving owners need to bring inspiration to refresh bland ASDA strategy, says GlobalData - GlobalData

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Following today's release of ASDA Q3 figures for 2020, Thomas Brereton, Senior Retail Analyst at GlobalData, a leading data and analytics company, comments: ''ASDA's monotonous Q3 results expose why the supermarket needs incoming new owners Issa brothers and TDR Capital (to be completed in H1 2021) to bring in a fresh view.

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CNBC reportsthat the average return represents 30 percent of the purchase price.

(Gehrung, 2021)
Gehrung, R., 2021. The Cost of Returns and Why You Should Care. [online] Total Retail. Available at: <https://www.mytotalretail.com/article/the-cost-of-e-commerce-returns-and-why-you-should-care/> [Accessed 19 November 2021].

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The Cost of Returns and Why You Should Care

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I surf e-commerce sites daily both professionally and as a consumer. While the overall user experience has improved greatly over the years, I am shocked

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The Cost of E-Commerce Returns and Why You Should Care

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(Klobas, 2021)
Klobas, R., 2021. Eight Tactics for Reducing Ecommerce Returns. [online] The Good. Available at: <https://thegood.com/insights/reduce-ecommerce-returns/> [Accessed 11 November 2021].

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Ecommerce returns are an ongoing problem that nearly every online business deals with.

It's estimated that there will be 2.05 billion global online shoppers in 2020, and nearly a third of all products purchased online end up being returned to the retailer.

That equates to an estimated 600+ million products being sent back to merchants in this year alone.

And with U.S. ecommerce sales on the rise since mid-April, these forecasts are only slated to increase as the year progresses.

As to be expected, this influx in product returns is putting more and more stress on the shoulders of ecommerce store owners. 57 percent of retailers report that dealing with returns has had a negative impact on their day-to-day operations, and 20 percent reported having to increase the price of their products to offset the cost of customers sending items back.

Here's the bottom line: If your online business doesn't already have an effective strategy for dealing with ecommerce returns, it's time to take action.

While it's inevitable that every company (regardless of size) will have to deal with a certain degree of returns, there's a lot you can do to optimize your customer experience so it reduces the chances of customers needing to send items back.

In this Insight, we'll be focusing on specific strategies you can employ to help reduce returns for your business and provide a better shopping experience for your customers.

Here's what we'll be covering:

What motivates customers to return an item?

How to optimize your website experience to reduce returns

Next steps for your business

What motivates customers to return products?

Before we focus on how you can reduce ecommerce returns for your business, it's important to understand why customers are sending items back in the first place.

The three main reasons why products get sent back to the retailer are: 1) The incorrect item or size was ordered, 2) The item failed to meet the expectation/description, and 3) The item was damaged upon arrival.

A simple survey asking your customers why they decided to return a product will give you invaluable insight into what aspects of your on-site experience may be to blame. If customers are frequently sending items back because they don't fit properly, that's a clear indication that there's something wrong with your sizing chart, or that you should display product dimensions more prominently on the product detail page (PDP).

Optimization should never be a guessing game. Identifying the source of the problem before beginning to test solutions will save you a lot of wasted time and effort in the long-run.

Optimizing your website experience to reduce ecommerce returns

When we're working with a brand that's struggling with a high rate of return, we often recommend they implement a combination of tactics to help rectify the problem. The following seven recommendations are what we've found to be most effective at reducing returns.

1. Implement a liberal return policy:

Promising customers an easy and expedited return process upfront will empower them to purchase a product with the confidence that if for some reason the product doesn't end up working out, they can send it back worry-free.

There's a reason why brands like Nordstrom and IKEA are known for their liberal return policies. Generosity builds trust, and trust leads potential customers further down the path to conversion.

One of the worst things you can do as an ecommerce business is restrict your return policy to save a buck. 69 percent of consumers won't even purchase from a brand if they don't offer to pay for return shipping, and 33 percent will not complete a purchase if they're unable to easily locate the company's return or exchange policy on the site.

An important point to note here is that we recommend you implement a fair return policy, not an excessively generous one. Companies like LL Bean and Glossier who are well-known for their liberal return policies have had to revise them in recent years because of abuse.

Every ecommerce business has the choice to enact a generous return policy. If you choose to go to the trouble of implementing one for your customers, you're likely to see positive results because of it.

2. Focus on detail-rich product descriptions:

A key contributor to product returns is when a product fails to live up to the expectations that were set on the website. It's frustrating receiving a product that you may have waited weeks to get in the mail, only to open it up and realize it's not what you wanted or needed.

The best way to eliminate customer disappointment is by bolstering your PDP descriptions. Make sure your customers know exactly what they're ordering. This is the template structure we use when optimizing product descriptions for our clients:

1. Create a description headline that will hook your audience.

2. Use a description paragraph to expand on what makes the product unique. Focus on providing a solution rather than describing benefits.

3. Follow the description with a bulleted list of key product specifications and features.

4. Conclude with credibility, social proof, or urgency, and include a call-to-action to motivate the user to purchase.

A great source of research for writing more persuasive product descriptions is your customer reviews. Here's what Lianna Patch ( Punchline Conversion Copywriting) had to say about writing great product descriptions:

"Mine reviews to identify patterns in what customers were/are wary of, what they appreciate, how they perceive and compare the product to competitors, and even pull language verbatim to use in your product copy."

Identify what your customers appreciate about a specific product and amplify that in your product description.
3. Focus on improving product imagery:
22 percent of returns occur because the product looked different in-person than how it was displayed on the website. The root of this problem lies in the quality and variety of your product images.

This is a fairly obvious recommendation, but you'd be surprised how often it's overlooked when a brand is working to optimize the customer experience of their site.

Providing a variety of product images that show multiple angles and situations can not only improve conversion rates, but also reduce the chance of a customer being surprised by what they thought they ordered. Show the customer how the product could fit into their life rather than trying to guess how they'll use it.

The DTC brand, Allbirds, sets the standard high for product imagery. Each of their product pages has 8+ images, each showing a different angle of the product. In addition to the images, they include a video that demonstrates how the shoes fit on a model's feet.

4. Implement a dynamic sizing chart:
Providing your customers with an accurate and detailed sizing chart is an essential part of reducing returns for your products. This is especially relevant if you're in the apparel industry, as average return rates for online apparel brands hovers around 40 percent.

ASOS has a great approach to helping customers pick the proper size with a short survey that utilizes aggregate data from past purchasers to help users select the right for them. You have the option to input your height, weight, body type, and personal fit preferences before the algorithm provides you with an accurate estimate of your perfect size. It's a helpful and efficient way of reducing returns to provide a more user-focused shopping experience.

5. Elevate the value of customer reviews:
Giving customers the option to leave detail-oriented product reviews is a great tactic for elevating social proof on a PDP. Additionally, it can unlock valuable insight into your products that otherwise would not have been discovered.

Another way to get the most out of customer reviews is to have fields like height, weight, body type, and size ordered and then offer filters to those specifications. Everlane does this really well. You're able to search for people who are your same height and weight and see if the size they ordered worked for them.

Nike sets a great example for how you can get the most out of reviews. They provide customers with the option to evaluate products based on three criteria: size, comfort, and durability. If a particular item runs small, you can indicate that in your review so future customers don't find themselves ordering the wrong size. This information is also collected and used by the company to help make improvements to product design.

Working with a third-party review collection company will help you capture more reviews from your customers in a shorter amount of time. Different businesses require different review tools and distribution channels. If you're looking to outsource the task of review collection to another agency, Shopper Approved is a company we'd recommend considering.
6. Start implementing product videos:
If customers are sending back products because they don't meet the expectations that were set in the product description, you may want to consider adding a video element to your PDP. Product videos are becoming an increasingly effective method for improving conversion rates, and 65 percent of consumers say they can better imagine themselves using a product after they've viewed a product video.

The DTC brand Away makes great use of product videos to help show the scale and functionality of their travel bags. It's a quick win that's guaranteed to improve conversion rates while also reducing the likelihood of customers returning purchases.

7. Promote exchanges instead of returns:
A 2018 consumer report from Narvar found that 57 percent of shoppers will replace the item they returned, and only 16 percent of customers will switch to a different retailer to find the same product. By making the exchange process easier, retailers can capture this revenue and keep customers coming back.

We recommend offering immediate refunds for ecommerce returns, and fast exchanges for products of equivalent value. Making your customers wait around until the return process is complete to issue a refund is a surefire way to get them to switch to a different retailer to find the same product.

8. Send a Post-Purchase Email

Sending a post-purchase email to your customers can be a highly effective method for reducing returns. Use the opportunity between order and delivery to educate customers about the product, reduce objections that lead to returns, and keep people excited about what they just purchased. Here's what Val Geisler ( F ix My Churn) has to say about post-purchase emails:

"It's your job as a brand to ensure that customers are excited about the product long after they hit purchase. Send educational emails and engage your customers so they never regret their purchase. Get them excited for delivery, don't let them sit and wonder if they made a good decision or not."

Regardless of the type of product you're selling, sending a post-purchase email to educate customers about their purchase is an important part of decreasing returns and providing an optimal customer experience.

Make your return process seamless

Clearly there's no way to completely prevent returns from occurring, so it's important to have a strategy for managing returns in the most efficient way possible when they do occur.

A great way to simplify the returns process for your business is by working with a third-party logistics (3PL) provider. Our partners at ShipBob are one of the best logistics solutions for ecommerce businesses of all sizes. If you're an emerging online business and don't have the resources to fully overhaul your logistics operations, you should seriously consider working with a 3PL company.

Take the necessary steps to reduce returns

It's inevitable that you'll have to deal with a certain amount of returns as an ecommerce business owner, but if you take the necessary steps now, you can significantly reduce the likelihood of it happening.

By implementing the tactics mentioned above, you can help provide your customers with a clearer picture of your products, and ensure that a higher percentage of them are satisfied with their purchase.

If your business is struggling with a high return rate, you may consider looking into a conversion optimization program. Iterative optimization is the best approach to solving an issue like this, especially if you haven't been able to properly identify the source of the problem.

About the Author

Rudy Klobas

Rudy Klobas regularly works to produce insightful, informative content and copywriting designed to help ecommerce leaders increase conversions.

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Eight Tactics for Reducing Ecommerce Returns

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Ecommerce returns are an ongoing problem that nearly every online business deals with. It's estimated that there will be 2.05 billion global online shoppers in 2020, and nearly a third of all products purchased online end up being returned to the retailer.

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“It will have benefited from its value proposition, as consumers are becoming more price conscious in the wake of the recession, and it will have stolen share from competitors Tesco's F&F and Primark, which lack transactional websites.”

(Geoghegan, 2020)
Geoghegan, J., 2020. Asda ups its fashion game. [online] Drapers. Available at: <https://www.drapersonline.com/people/the-drapers-interview/asda-ups-its-fashion-game> [Accessed 25 November 2021].

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We know that the average ecommerce return rate is around 30%, and the average Shopify brand loses 80% of its returns to refunds.

(Saleh, 2021)

Saleh, K., 2021. E-commerce Product Return Rate – Statistics and Trends [Infographic]. [online] Invesp. Available at: <https://www.invespcro.com/blog/ecommerce-product-return-rate-statistics/> [Accessed 19 November 2021].

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Let me explain why the true cost of a refund is much greater than just the dollars you give back to the customer. Before we go into the specific costs, I need to explain how we view the difference between a refund and an exchange.

A return ≠ a refund!

A refund signals the end of a relationship

Before I get too far into all the associated costs of a refund, it's important to understand the high-level thinking. A return doesn't equal a refund and not all return outcomes are created equally.

At Loop, we see a refund as the end of the customer relationship. The customer didn't want an exchange or store credit, which means they're likely taking that money to shop somewhere else. By requesting that refund, they're signaling that something about the product or experience was off and they don't want to continue the relationship with your brand.

A refund often signals the end of a customer relationship and that has a cost.

Many of the costs we're going to talk about are ones you'll never recoup since these individuals won't become repeat or loyal customers.

The hidden costs of an online refund

Now that we know a refund is signaling the end of a relationship, we can evaluate the true cost of a refund.

There are many hidden costs associated with a refund. Without taking these into account, you're not getting a truly complete picture of how much refunds are costing your business. Let's take a look at the ones that have a major impact on your bottom line.

Customer acquisition costs

This one is pretty straightforward. When a customer refunds an order, you're losing the acquisition dollars that you invested to get that person in the door.

So let's say the average CAC for ecommerce brands is around $45. That means, with every refund, you're not just losing out on the original value of the item. You're also losing the $45 you spent to acquire that customer and now have to invest another $45 to replace them.

Shipping costs

If you're like most customer-focused brands, you probably offer free shipping on all returns. This means that, with every refund, you're eating the shipping costs. And, unlike an exchange, you're not retaining any revenue or preserving the customer relationship with a refund.

Labor costs

On the backend, there's a ton of labor that goes into dealing with refunds (especially if you're handling returns manually).

Depending on the state of the item you receive back, your team may have to return everything to inventory, repair or repackage the product, or even discard it completely. Because the nature of refunded items can be unpredictable, there's a lot of labor and decision making that goes into the process.

Support, warehouse, and administrative labor costs are all associated with a return.

Opportunity costs

A refund signals the end of the customer relationship. This means that, in addition to all the other costs we mentioned, you're also losing out on the future revenue that you could have been making if your customers had decided to stay with your brand.

While the exact opportunity cost depends on your brand's customer lifetime value, the fact that a 5% increase in your customer retention rate can lead to a 95% increase in profitability is pretty cut-and-dry proof that keeping customers with your brand is the way to go.

The total cost of a refund

To make the idea more tangible, let's attach some hypothetical numbers to these costs:

Because opportunity cost is challenging to calculate, we'll leave that out of the equation for now.

This means that every return = $45 (CAC) + $7 (shipping costs) + $30 (2 hours of labor) + $20 (cost of the item assuming you don't resell it)
That is a total cost per refund of = $102
Total cost of a refund example

We know that the average ecommerce return rate is around 30%, and the average Shopify brand loses 80% of its returns to refunds.

So if you sell 10,000 items in one month, 2,400 of them will end up being refunded. If we use our total cost of a refund estimate above, this hypothetical brand is losing $244,800/mo in return costs and wasted acquisition costs.
That is a total cost of $244,800/mo.
But does this just end up being the cost of doing business? Not if you look at an exchange as a continuation of the shopping relationship.

Exchanges continue the relationship and retain profitability

Are exchanges any better? While you still have many of the same costs associated with an exchange, the main difference is that the relationship is continuing. This gives you an opportunity to recoup the costs in the future instead of chalking it up as a loss with a refund.

While you still end up paying the shipping costs and labor costs of an exchange (you can reduce this with an automated portal), you still have a customer. The acquisition costs are not lost in this scenario and you can still get a second, third, and fourth purchase from them.

An exchange continues the relationship and your CAC stays an investment in future value rather than a lost cost.

By shifting your mindset to focus on turning refunds into exchanges, you can minimize all the hidden costs that we discussed in this post. To learn how to reduce the number of refunds for your brands, just get in touch with our team.

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Let me explain why the true cost of a refund is much greater than just the dollars you give back to the customer. Before we go into the specific costs, I need to explain how we view the difference between a refund and an exchange. A return ≠ a refund!

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(The space where purchasing decisions are made, Fitting Rooms, 2019)
Retail News Asia. 2019. The space where purchasing decisions are made, Fitting Rooms. [online] Available at: <https://www.retailnews.asia/the-space-where-purchasing-decisions-are-made-fitting-rooms/> [Accessed 6 November 2021].

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The space where purchasing decisions are made, Fitting Rooms

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Why do customers walk into a fitting room when they are in a retail space? The answer is logical: because they have found a piece of clothing they like –

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The space where purchasing decisions are made, Fitting Rooms

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(Online Returns in the UK, 2018 - 2023, 2018)
GlobalData Report Store. 2018. Online Returns in the UK, 2018 - 2023. [online] Available at: <https://store.globaldata.com/report/online-returns-in-the-uk-2018-2023/> [Accessed 6 November 2021].

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List of Figures

Size of the returns channel: 2017, 2018 & 2023

Returns share of online retail spend: 2017, 2018 & 2023

Growth of online returns and online spend: 2018- 2023

Sector returns penetration, 2018

Share of returns channel size by parcel size, 2017 & 2018

Overall sector penetration of shoppers who have returned goods online, 2018

Returns penetration of online shoppers: Books, by demographic, 2018

Returns profile of online shoppers: Books, by demographic, 2018

Returns penetration of online shoppers: Clothing & footwear, by demographic, 2018

Returns profile of online shoppers: Clothing & footwear, by demographic, 2018

Returns penetration of online shoppers: DIY & gardening, by demographic, 2018

Returns profile of online shoppers: DIY & gardening, by demographic, 2018

Returns penetration of online shoppers: Electricals, by demographic, 2018

Returns profile of online shoppers: Electricals, by demographic, 2018

Returns penetration of online shoppers: Food & grocery (gifting), by demographic, 2018

Returns profile of online shoppers: Food & grocery (gifting), by demographic, 2018

Returns penetration of online shoppers: Furniture & floorcoverings, by demographic, 2018

Returns profile of online shoppers: Furniture & floorcoverings, by demographic, 2018

Returns penetration of online shoppers: Health & beauty, by demographic, 2018

Returns profile of online shoppers: Health & beauty, by demographic, 2018

Returns penetration of online shoppers: Homewares, by demographic, 2018

Returns profile of online shoppers: Homewares, by demographic, 2018

Returns penetration of online shoppers: Entertainment, by demographic, 2018

Returns profile of online shoppers: Entertainment, by demographic, 2018

Statements around online returns, 2018

How items were returned: Total, 2018

How items were returned: Books, 2018

How items were returned: Clothing & footwear, 2018

How items were returned: DIY & gardening, 2018

How items were returned: Electricals, 2018

How items were returned: Food & grocery (gifting), 2018

How items were returned: Furniture & floorcoverings, 2018

How items were returned: Health & beauty, 2018

How items were returned: Homewares, 2018

How items were returned: Entertainment, 2018

Drivers of online returns: Total excluding clothing & footwear, 2018

Drivers of online returns: Books, 2018

Drivers of online returns: Clothing & footwear, 2018

Drivers of online returns: DIY & gardening, 2018

Drivers of online returns: Electricals, 2018

Drivers of online returns: Food & grocery (gifting), 2018

Drivers of online returns: Furniture & floorcoverings, 2018

Drivers of online returns: Health & beauty, 2018

Drivers of online returns: Homewares, 2018

Drivers of online returns: Entertainment, 2018

Cost of online returns: Books, 2018

Cost of online returns: Clothing & footwear, 2018

Cost of online returns: DIY & gardening, 2018

Cost of online returns: Electricals, 2018

Cost of online returns: Food & grocery (gifting), 2018

Cost of online returns: Furniture & floorcoverings, 2018

Cost of online returns: Health & beauty, 2018

Cost of online returns: Homewares, 2018

Cost of online returns: Entertainment, 2018

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The "Online Returns in the UK, 2018 - 2023", report forms part of GlobalData's Retail Channels series, and offers a comprehensive insight into the consumer and market dynamics of the online returns channel. The report analyses the channel, the main trends, and consumer attitudes towards online returns.

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Get the returns experience right and 92% of customers will return to buy again.

(Dopson, 2021)
Dopson, E., 2021. How to Handle and Prevent Ecommerce Returns for Maximum Profitability. [online] Shopify Plus. Available at: <https://www.shopify.co.uk/enterprise/ecommerce-returns> [Accessed 11 November 2021].

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Ecommerce returns can be a disease-aggressively attacking profit margins, gutting conversion rates, and ultimately threatening your business.

Collectively, consumers returned products worth $428 billion in 2020-just over 10% of total retail sales. The National Retail Federation estimates the cost of returns amounts to $101 billion.

It paints a bleak portrait, especially for online retailers. But the real cost driver is this: many customers buy with an explicit plan to immediately return some or all of their items.

In response, businesses are adding workers, increasing warehouse space, and establishing separate departments to handle reverse logistics. Returns are the new normal and central to customer experience. But they don't have to be a plague.

In fact, how you deal with ecommerce store returns-before and after purchase-can differentiate your brand, create a competitive advantage, and even make you more profitable.

Get the latest ecommerce trends, insights and resources straight to your inbox
Table of Contents:

1. The state of ecommerce returns in 2021

2. Strategies for handling ecommerce returns

3. The best software for handling ecommerce returns

4. Ecommerce returns best practices

The state of ecommerce returns in 2021

Ecommerce return rates by industry

Ecommerce returns happen across all industries. In fact, a quarter of all consumers return between 5% and 15% of the items they buy online. (That supports why more than a quarter of retailers have seen a rise in the number of online-purchased items being returned by a customer.)

Automotive retailers struggle the most, with customers in those industries returning more than almost 1 in 5 purchases. That's shortly followed by apparel retailers (12.2%) and home improvement and houseware brands, whose customers return 11.5% of online orders.

We also see differences between the number of returns and the payment method a customer used. Shoppers that purchase an item using a credit card were most likely to return an online purchase. Those buying with a debit card were the least likely.

Why do people return items?

Data suggests that 20% of online-bought products are returned, compared to just 9% of items bought in a brick-and-mortar store. Let's take a closer look at why that figure is so high.

Consumer preference-based returns (e.g., size, fit, style, etc.) tend to drive around 72% of all returns in fashion product categories. Non-preference-based reasons (e.g., defective) and "not as described" account for 10% in total.

1. Size too small: 30%

2. Size too large: 22%

3. Changed my mind: 12%

4. Style: 8%

5. Not as described: 5%

6. Defective: 5%

7. Other or not specified: 18%

When customers know that they can get their money back just as easily as they can spend it, they'll shop with more confidence and spend more."

- Sanaz Hajizadeh, Happy Returns

Ecommerce returns and the holiday season

Unsurprisingly, the number of returns mirrors peak ecommerce sales periods. The holiday season, for example, is the most popular time of year for online shopping.

A quarter of holiday shoppers buy items with the intention of returning them at a later date. Whether it's gifts a friend doesn't like or trying to reclaim some money they spent in a holiday-inspired splurge, it's why ecommerce brands receive the most returns throughout December, January, and February.

The COVID impact on ecommerce returns

Shipping courier DHL saw a 20% decrease in average weekly return volumes during the start of the pandemic. It reports that "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."

Interestingly, we see similar ecommerce trends in the time it takes for brands to process a return. Pre-COVID, it took retailers 4.53 days to register a return. Now, that's bumped up to 8.17 days.

The impact of returns on customer loyalty

When people do decide to return their online purchases, most retailers opt to refund the purchase price to a customer post-return. Some 18% offer exchanges; the same amount give a gift card to redeem on a future purchase.

Regardless of which refund type a retailer is offering, there are strong customer expectations to compete with. Some 62% of customers expect an exchange or refund within 30 days of purchase.

But put a foot wrong in this return experience and you'll add a hurdle in your mission toward getting repeat customers. Data from Rebound shows a quarter of shoppers think a delay in processing their return contributes toward a negative experience.

Get the returns experience right and 92% of customers will return to buy again. You'll make future purchase decisions easier and increase customer lifetime value.

Strategies for handling ecommerce returns

Post the item back to your warehouse

This is the most popular returns process for ecommerce-only brands without a brick-and-mortar store. When a customer wants to return an item they've bought online, they post it back to your warehouse or fulfillment center. From there, the merchandising department inspects the product and confirms it's eligible for a refund.

Retailers can save time on manual returns with return management apps. They'll speed up the process, give customers a status of their return, and update your inventory management system automatically (more on that later).

Return items to store

Research shows that 62% of shoppers are more likely to shop online if they can return their purchase to a physical store. If you have one, consider allowing ecommerce customers to visit the store to return their item. The returned goods can then be inspected and put back on the shelf for future customers.

Not only are store returns more convenient, but enticing customers to enter a store could prevent future returns. If a customer is returning a t-shirt that doesn't fit, for example, they'll have the opportunity to try on other sizes during their visit. That gives them more confidence in future purchase decisions-both online and offline-because they know their size.

Outsource reverse logistics

Returns management is a lengthy process. But it's one you don't have to handle in-house. Third-party logistics (3PL) partners handle the entire order fulfillment process-including returns. A provider offering reverse logistics stores a retailer's inventory in a third-party warehouse.

When customers return an item the 3PL has previously shipped, it arrives back at their warehouse. Their team inspects the item and processes a refund. The approved returned item is then put back on the shelf to be picked for another order.

Watch: 3 Signs You Need a 3PL

Best software for handling ecommerce returns

Brands can handle ecommerce returns by using one of the many returns and exchanges apps available in the Shopify App Store. These apps track and fulfill orders, get your products out the door, and protect your business from risky transactions.

When the customer experience team is spending the majority of their time manually creating shipping labels and answering questions like "Where is my refund?" instead of helping the shoppers find the right item to purchase, it's a clear indication that it's time to automate returns."

-Sanaz Hajizadeh, Happy Returns

Across all Shopify businesses, 65% of refunds are performed manually; the remaining 35% via apps. Here are three of the most popular.

Happy Returns

Happy Returns is an ecommerce returns management software used by retailers like Rothy's, Everlane, and Andie.

Sanaz Hajizadeh, Happy Returns' Director of Product Management, explains, "Happy Returns offers box-free returns for online merchants through a combination of software and reverse logistics-pioneering in-person, aggregated returns that can help dramatically reduce shipping costs and the impact on the planet."

"Happy Returns covers all aspects of post-purchase: from tracking orders as they are fulfilled to providing flexible return options for merchants, no matter where their warehouse and shoppers are located."

In addition to its returns software, Happy Returns also provides buy online, return to store and mail returns services for hundreds of leading merchants. It maintains a network of over 2,600 Return Bar locations where online shoppers can drop off their returns in person.

"Every merchant should focus on selling and increasing revenue. By using tools that automate the post-purchase process, they can reduce operational headaches. Of course, merchants can use one tool for each task, but combining them in one powerful tool makes it easier to gather data, manage their return policy, and keep everything seamless and on-brand."

Loop

Loop is another returns management tool for Shopify Plus sites. Customers submitting a return are incentivized to exchange the item, rather than return it. They can exchange an item for another size or color in one click.

Should a customer still want a refund for their purchase, Loop helps retailers streamline their returns process. It uses data from a returns form and your returns policy to automatically approve or deny requests.

"We like Loop because it is incredibly user friendly, so it's super easy for customers to return items. We like this because it makes us look good and lets the customer leave with a positive experience. Because of the way that it's set up, it makes it easy to swap out returns for other products in our shop, which helps keep the customer and the money." -Lanai Moliterno of Sozy.

Returnly

If you're managing ecommerce returns from international customers, Returnly is a good option. It automatically creates return labels to get packages through customs. Shoppers can also request refunds (or credit) in their local currency.

Not only that, its Green Returns program helps retailers reduce waste. It makes real-time decisions based on a retailer's returns policy to judge whether an item can be resold if returned. If it can't, the customer doesn't need to waste their time shipping it back. Fewer shipments mean less waste, cheaper shipping costs, and better customer experiences.

Ecommerce returns best practices

Now we know the process for handling ecommerce returns and the options available to you, there are still things you can do to reduce the number of returns you're handling. (That's the end goal, after all. Fewer returns means happier customers and more revenue.)

Here are six ecommerce returns best practices to boost efficiency and cut costs.

Make product information accurate and easy to find

It's standard practice to check that all public-facing content-including product descriptions-are accurate and detailed. If the product arrives differently than expected, there's a high chance of it being returned.

To reduce returns and improve conversions, make sure the following information is included on every product page across your ecommerce site:

Product weight and dimensions

Materials used to make the product

Size guides, including the size a model is wearing (if appropriate)

Your ecommerce returns policy (i.e., how long they have to return an item, any costs associated with it, and the types of product eligible for return)

Rothy's highlights its returns policy on each product page to increase conversions and prevent returns.
Take Supplement Warehouse, for example. It ships 300 supplement packages daily through its warehouse, all of which are ordered through its ecommerce store. Its marketing manager, Brian Anderson, explains that most people return their items because customers didn't notice that their product contained a specific ingredient.

"Because we sell vitamins and supplements, many people order the product and wait until they have it in hand to review all of the ingredients. Some are allergic or their doctor told them not to take it, so they end up returning it. We have made sure that all product labels are large and visible on product pages. This makes it easier for potential customers to read the label before they purchase." -Brian Anderson, Marketing Manager at Supplement Warehouse

Automation helps solve most of these issues. Use plug-ins like Low Stock Alert to see when items are running low. It prevents you from selling an item that isn't available-and shipping the wrong item in its place.

According to Josh Wayne, VP of Commerce Products at TrueCommerce, "A lot of brands try to manage all their product information manually, and with ecommerce channels growing so rapidly, it's just not feasible to avoid mistakes that way."

"What ends up happening is, a customer orders a product, and when it arrives, it's the wrong color or size or compatibility, because there was incorrect or missing information online. It's an immediate return, and can also result in low ratings and reviews, which impact future sales." -Josh Wayne, VP of Commerce Products at TrueCommerce

Use 3D/AR on your ecommerce website

Shopping in-store naturally has some advantages over shopping online. Amongst the biggest is the ability to see, try on, and interact with products before a customer decides to buy it.

Augmented reality (AR) technology helps online shoppers experience the same thing. Retailers can use it to show what their products look like tried on, in a customer's home, or next to an item they own for a size comparison.

Each of those things prevent the reason behind 22% of returns: the fact the item looks different in-person than it did online.

Gunner Kennels, for example, uses augmented reality and 3D technology on its ecommerce store. It knew it'd be difficult for customers to see the size of a dog crate and whether their pet would fit inside it-which would inevitably lead to returns.

With the help of Shopify Plus, Gunner Kennels developed 3D models of its crates.

With this technology, buyers can now use their device to place the crate right next to their dogs to confirm sizing, decreasing our return rate by 5%. We would like to use this feature on future products and other accessories moving forward."

-Macey Benton, VP of Marketing, Gunner Kennels

The retailers' investment in 3D and AR technology paid dividends:

Return rate reduced by 5%

Cart conversion rate increased by 3%

Order conversion rate increased by 40%

Learn more: Augmented Reality in Ecommerce: How AR, VR and 3D Are Changing Online Shopping

Pack and ship items securely

It's easy to think that once an item has left your warehouse, it's off your plate. The truth is, some 30% of items are returned because they arrived faulty or damaged. But you wouldn't ship them in that state. Something went wrong in transit.

Granted, your delivery carrier plays a big role in this. But there are steps you can take to minimize the chances of an item becoming broken or faulty through shipping-and therefore, being returned:

Inspect every item of clothing before it's dispatched to a customer

Use protective material, such as bubble wrap, in a delicate package

Add Fragile labels to parcels with easily breakable items inside (like glass)

Use the correct parcel size so items don't jolt around in transit

Make your returns process sustainable

Data shows that three-quarters of customers intend to shop more with retailers that are making their returns process more sustainable. Another 71% would be willing to pay more to return with a sustainable option.

But most companies' existing returns policy doesn't fit that bill. It's estimated that return shipping in the US alone creates 15 million tonnes of carbon emissions per year. That's the same amount produced by five million people.

Preventing the likelihood of returns help to reduce your ecommerce brand's carbon footprint. The fewer packages that come your way, the less fuel and resources you use.

Unfortunately, you'll still deal with returns. Make sure your ecommerce return policy is more sustainable by ditching the prepackaged free-return labels in your parcels. Printing those labels-even for customers who don't need them-is wasteful. Instead, ask customers to go online and print their own labels when needed.

We donate customer returns to charity or other institutions that need them. Not only are we addressing the issue of returns, but we are also helping people who badly need a product like ours."

-Stephen Light, co-founder of Nolah

Keep customers informed about the status of their return

For ecommerce businesses, brand perception and reputation is everything. Just one tweet like this can influence another customer's decision to purchase from you or a competitor:

"The most important question to ask when assessing your reverse logistics process," says Andrew Bowden, Senior Manager of Product Marketing at TradeGecko, "is whether or not you're designing and optimizing the experience for the customer or for your business-ideally, it's a mix of both."

"When in doubt, default to the customer. First, keep them up to speed on the returns process while in the flow, either by email or, preferably, via Facebook Messenger or SMS. If your OMS facilitates this, incredible. Second, get feedback and ratings on the returns process itself-that's where you'll find gold nuggets to set yourself apart from the competition."
Apple's return confirmation email. Source: Really Good Emails
Find a shipping carrier that supplies tracking information. Most offer tracking numbers for customers to see the location of their returned parcel. Once it arrives at your warehouse, send the customer an automated message to confirm you've got it. Give them an ETA on how long they should expect to wait for a refund.

Protect your business against ecommerce return fraud

Did you know that for every $100 in returned merchandise, retailers lose $5.90 to return fraud? It's costing US retailers more than $18 billion a year, and happens when people return stolen items, claim an item never arrived, or use the item and return it later.

It's crucial to separate the types of returners and track them automatically. A tool like Shopify Flow can help. Establish refund thresholds based on per-order dollar values or the number of returned items. Second, use that threshold to automatically:

Tag customers for identification and segmentation

Notify your customer service team via email or Slack to investigate

Add those customers as a segment within an onsite personalization tool to exclude them from free shipping and/or full-refund offers

Exclude them from free shipping at checkout by creating a Shipping Script based on one or more of your customer tags.

Some retailers-including Amazon and ASOS -are reportedly updating their returns policy to blacklist serial returners. While extreme, such actions are often necessitated by the first type of habitual returner.

If blacklisting customers isn't an option for your ecommerce business, there are other things you can do to prevent return fraud:

Choose a delivery carrier that supplies tracking numbers or proof of delivery. For example, a photo inside a customer's open doorway.

Substitute cash refunds for exchanges or store credit. There's less incentive for someone to try and return a stolen item if they're getting a like-for-like back.

Offer a longer exchange window than you do for a refund. This ensures your customer still has ample time to return but makes an exchange more likely.

Ditch free return shipping to make it harder for fraudsters to push their luck with return fraud.

Only process returns if the item comes with a receipt or proof of purchase. This prevents people from returning stolen merchandise, or items purchased from another retailer. You'll also see the exact amount they paid for the item to process a refund.

Don't accept returned items of clothing without the original tag or protective seal. This prevents wardrobing: when a customer wears an item and returns it as if it were new.

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Ecommerce returns are inevitable, but manageable

With 10.6% of all online purchases eventually diverting back toward the retailer's warehouse, ecommerce returns aren't something you can ignore.

Do everything you can to prevent returns-from writing accurate product descriptions to picking and packing items securely.

Remember that a small number of returns is inevitable. When it happens, keep customers informed about the status of their return. Choose sustainable options. Prevent return fraud by offering online store credit instead of cash refunds. Consider outsourcing reverse logistics if it's becoming too time consuming to handle in-house.

The returns process might be the final part in a first-time customer's journey with you. But it's still just as important as the first part.

Looking for a returns management platform that works seamlessly with your Shopify Plus site?
Check out our partners
Ecommerce Returns FAQ

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Ecommerce Returns: Tips for Success (2022)

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Ecommerce returns can be a disease-aggressively attacking profit margins, gutting conversion rates, and ultimately threatening your business. Collectively, consumers returned products worth $428 billion in 2020-just over 10% of total retail sales. The National Retail Federation estimates the cost of returns amounts to $101 billion. It paints a bleak portrait, especially for online retailers.

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Supermarket clothing brand, George at Asda is looking to improve the online customer experience by partnering with delivery experience platform Sorted.

The trial is aimed at providing real-time updates to improve post-purchase tracking for George customers, explained the supermarket in a statement, due to what it calls an "increased and sustained appetite for online shopping".

Sorted's React software will improve the level of communication George at Asda customers receive throughout their parcel's journey, giving them updates in real-time about the status of their order.

The platform proactively notifies George customers of any issues with their delivery and automatically refers them to the customer service team, with the aim of resolving things for the customer as soon as they happen.

Neil Drake, senior manager for parcel service and format development at Asda, said: "We're delighted to be the first supermarket fashion brand to implement this software, which will make it even easier for our customers to shop with us.

"We are always looking to provide a better online experience for our customers, and understood that there was a need to communicate more frequently with them from the point of order through to delivery. By partnering with Sorted we are able to provide them with real-time updates about the status of an order and proactively notify them of any change."

David Grimes, chief executive of Sorted, added: "Our team is delighted to be working with one of the UK's flagship retailers in George at Asda. They're leading the way amongst large brands by putting the right measures in place to avoid any risk to their customers' delivery experience.

"Supermarkets are extremely important to the communities they serve, and our technology has the power to help George at Asda and similar major brands underpin strong customer service during and beyond Covid-19 disruption."

Image: courtesy of George at Asda

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George at Asda partners with Sorted to improve customer experience

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Supermarket clothing brand, George at Asda is looking to improve the online customer experience by partnering with delivery experience platform Sorted. The trial is aimed at providing real-time updates to improve post-purchase tracking for George customers, explained the supermarket in a statement, due to what it calls an "increased and sustained appetite for online shopping".

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I'm sitting at my desk as I write this intro-a desk that I assembled over the course of a snowy Saturday afternoon last winter.

Had the box in which the parts were shipped not included an instruction manual, my chances of successfully building this desk would've been close to zero. I would've given up after 10 minutes of halfhearted tinkering, shoved the parts into my closet, and laid down on the couch.

I can't build stuff unless I'm given instructions. And if I were a seller, I wouldn't be able to win competitive deals unless I were given tips, tactics, and talking points.

In other words, if I were a seller, I wouldn't be able to win competitive deals unless I were given battlecards-which, as our title lays bare, are not the same as competitive comparisons.

Today, we're going to:

Define the meaning and purpose(s) of a competitive comparison

Define the meaning and purpose of a battlecard

Clarify the fundamental differences between these two assets

Share three types of insights that you can pull from your competitive comparison into your battlecard

Let's jump in!

What is a competitive comparison?

A competitive comparison is a framework for mapping and understanding the similarities and differences between your company and one or more alternatives. The classic example is one with which you're likely familiar-the feature comparison matrix:

Of course, if you read our definition closely, it's clear that a competitive comparison need not be product- or feature-focused. If you'd like-and if it'd be valuable to your fellow marketers-you can create a competitive comparison that looks at your industry through the lens of, say, website traffic and social media followers:

When it comes to competitive comparisons, what matters most is that you're able to take datapoints-e.g., Competitor A doesn't offer this feature, Competitor B drives this much traffic, etc.-and turn them into insights-e.g., This feature group is our greatest vulnerability, Our website traffic is relatively strong, etc.-that drive sound decision-making.

What is a battlecard?

A battlecard is a document that helps your sellers go head-to-head against a specific competitor. Because each battlecard is uniquely focused on a single competitor, its contents can vary. After all, the tips, tactics, and talking points your sellers need to beat Competitor X may not be the same as those that they need to beat Competitor Y.

That being said, there are certain categories of content that many of you will often find valuable: the competitor's key strengths and weaknesses, reasons why you win and why you lose, landmines, and so on.

When it comes to battlecards, what matters most is that your sellers are able to quickly find the information they need and communicate it in ways that resonate with prospects. In other words, what matters most is that your sellers are neither:

1. Helplessly scrambling for useful information, nor

2. Peppering prospects with seemingly random facts that mean nothing to them

Fundamentally different-and closely related

There are two fundamental differences between competitive comparisons and battlecards:

1. Whereas competitive comparisons can serve as both analysis tools and deliverables, battlecards are strictly deliverables.

2. Whereas competitive comparisons, as deliverables, can be broadly valuable across multiple stakeholder groups, battlecards are created specifically for sellers.

If you're skeptical about the utility of competitive comparisons as deliverables, think about your product team. When they're tasked with establishing priorities for the upcoming quarter, a feature comparison matrix can ease the decision-making process considerably. ("We have an opportunity to be the first to market with XYZ, but that window is rapidly shrinking. We need to ship this before it's too late.")

Think about your fellow marketers, too. Something as simple as our example of the marketing reach matrix can be a valuable asset. ("We continue to lead the pack on social, but our website traffic is not where we need it to be. Let's hold off on that Hootsuite upgrade and start searching for a Technical SEO Manager.")

And here's why competitive comparisons and battlecards, though fundamentally different, are closely related: Because competitive comparisons also serve as analysis tools, they can help you uncover the insights that are subsequently translated into the tips, tactics, and talking points on which your battlecards are built.

As an example, let's say you're a product marketer at Knock, a made-up software company that provides workplace communication tools. To empower your product team, you create a feature comparison matrix (which we'll paste down here to keep you from scrolling back and forth):

Shifting focus to your sales team, you notice that, compared to Competitor E, you're relatively strong on Feature Group 1 (written communication features) and relatively weak on Feature Group 3 (video communication features). To help your sellers stay cool, calm, and collected when conversations with prospects shift towards video, you could add a talking point like this to your Competitor E battlecard: "Zoom fatigue is rampant. Employees are on camera enough as it is, and our product team is laser-focused on the stuff that our customers actually want: tools that will help them effectively collaborate through the written word."

Think of it this way: Your competitive comparison is a box of parts, and your battlecard is the instruction manual that empowers your sellers to put those parts together.

3 types of insights that you can pull from your competitive comparison into your battlecard

To cement this relationship between competitive comparisons (as analysis tools) and battlecards (as deliverables), let's quickly explore three types of insights that you, as a PMM and an activator of competitive intelligence, can pull from the former into the latter:

Warning signs. Sometimes, a seller will find out they're in a competitive opportunity because their prospect explicitly says so. Other times, a seller will find out because their prospect asks a question that's a little too specific-i.e., a question that was obviously planted by your competitor in order to put your seller on their heels. If one of your competitors offers a special feature or service that your product can't match, that's a good candidate for a warning sign.

Talking points. Warning signs make for useful battlecard content because they alert your sellers to previously undetected competitors. But where do they go from there? As we showed with our Zoom fatigue example, talking points are designed to help your sellers pivot away from your weaknesses and towards your strengths.

Landmines. Those questions that your competitors are planting in your prospects' minds? They're called landmines, and you should use them, too. If your product is strong in an area where one of its alternatives is weak, come up with clever questions for your sellers to ask their prospects (e.g., "How important is XYZ to your business?").

Start activating intel today with free battlecard templates

Like we said earlier: Depending on which competitor you're targeting, the optimal content for your battlecard may vary. That's why we've created not one, not two, but seven free battlecard templates that you can download and put to use right now.

Your sellers will thank you. Click the banner below to get started!

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Competitive Comparisons: What They Are & What They Aren't

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I'm sitting at my desk as I write this intro-a desk that I assembled over the course of a snowy Saturday afternoon last winter. Had the box in which the parts were shipped not included an instruction manual, my chances of successfully building this desk would've been close to zero.

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(Company facts, 2021)
Asda. 2021. Company facts. [online] Available at: <https://corporate.asda.com/our-story/company-facts> [Accessed 4 November 2021].

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Asda Stores Ltd was founded as a supermarket committed to offering shoppers Every Day Low Prices. We have stayed true to our heritage, never losing sight of our goal of ‘Save Money. Live Better’.

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(UK fashion industry statistics, 2021)
Fashionunited.uk. 2021. UK fashion industry statistics. [online] Available at: <https://fashionunited.uk/uk-fashion-industry-statistics/> [Accessed 2 November 2021].

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General data

Employment

Currently around 555,000 people are employed in fashion, textiles and fashion retail in the United Kingdom. Most jobs in fashion related industries are in the retail sale of clothing. This sub industry employs 75 percent with 414,000 people working in the retail sale of clothing. Also the retail sale of footwear and leather goods provides a fair amount of jobs in fashion, about 11 percent, 59,000, employers work within this sector. Another 8 percent, 43,000 employers, work in the wholesale of clothing and footwear. With respectively 34,000 en 5,000 positions, 6 percent and 1 percent, the least amount of jobs are in the manufacturing of wearing apparel and the manufacturing of footwear.

Fashion companies

Top companies based on market capitalization

The biggest company in the UK based on its market capitalization is the Burberry Group plc. The luxury fashion company is valued over 10 billion dollar and had revenue of 3.8 billion dollar in 2017. Burberry sells its products through retail and wholesale channel, retail sales accounted for 77% of revenue compared to 22% from wholesale.

Fast-fashion retailer Next Plc is the second largest fashion company in the United Kingdom, based on its market value of 7.16 billion pounds. Next is mostly active in retail market in the UK, where it makes most of its 4.0 billion pound of annual sales. Only a small part, 2 percent, of Next's' revenue comes from international retail.

Retail giant Marks & Spencer is number 3 in the Top 10 largest fashion companies in the UK. It is currently valued over 7 billion pounds and has annual sales of 10.3 billion pounds. Whereas its UK food division is ever expanding, Marks and Spencer's fashion and UK general merchandise sales have been declining in the past years.The UK still accounts for 89 percent of the total sales, although its international presence is increasing, especially in food. Because of the declining fashion and general merchandise sale Marks and Spencer is facing a continuous downfall in market value.

With a market value of 6.2 billion dollar ASOS is fourth largest company in the UK and has annual sales of 1.8 billion pounds. The online fashion store sells over 850 brands as well as its own range of clothing and accessories. International retail sales for ASOS accounted for almost 63% of total retail sales.

Consumer expenditure

In million GBP

In percentage

Imports & Exports

Exports of clothing: 9.2 billion USD

Imports of clothing: 34.4 billion USD

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Currently around 555,000 people are employed in fashion, textiles and fashion retail in the United Kingdom. Most jobs in fashion related industries are in the retail sale of clothing. This sub industry employs 75 percent with 414,000 people working in the retail sale of clothing.

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(George popularity & fame | YouGov, 2021)
Yougov.co.uk. 2021. George popularity & fame | YouGov. [online] Available at: <https://yougov.co.uk/topics/consumer/explore/brand/George> [Accessed 2 November 2021].

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George is the 7th most popular fashion & clothing brand and the 293rd most popular brand. Explore the latest YouGov polling, survey results and articles about George.

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"Of the retailers we surveyed, the difference in processing cost between the most and least expensive channels is $5 to $6 on average, while processing returns in stores can save up to 18 days of processing time, improving the chances that the item can be resold at full price."

(Ader et al., 2021)
Ader, J., Chai, J., Singer, M., Adh, P., Touse, S. and Yankelevich, H., 2021. Returning to order: Improving returns management for apparel companies. [online] McKinsey & Company. Available at: <https://www.mckinsey.com/industries/retail/our-insights/returning-to-order-improving-returns-management-for-apparel-companies> [Accessed 2 November 2021].

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Returning to order: Improving returns management for apparel companies<br class=“t-last-br” />

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High levels of retail returns are not inevitable. Better management can reduce the cost and improve consumer loyalty at the same time.<br class=“t-last-br” />

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"Asda refuses to break out sales figures for George, but the value retailer had a 4.1% share of the UK clothing market in December, up from 3.6% five years ago, GlobalData reported."

"A big advantage that George has is that it is online and it has a well-established, successful online channel, unlike some of its competitors (including Tesco’s F&F and Primark). George has got scale advantages, both physical and online. It is well established, works well and has solid base from which to build a bigger business.”

(SEARES, 2021)
SEARES, E., 2021. What's Next for Asda's George?. [online] Drapers. Available at: <https://www.drapersonline.com/news/whats-next-for-asdas-george> [Accessed 2 November 2021].

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“George is the second-largest retailer of clothing in the UK by volume, and has a vibrant and growing home offer that attracts customers to our stores and online. "

(Geoghegan, 2021)
Geoghegan, J., 2021. No sale – Asda’s plans for George revealed. [online] Drapers. Available at: <https://www.drapersonline.com/news/asda-plans-for-george-revealed> [Accessed 2 November 2021].

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No sale – Asda’s plans for George revealed

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Asda has confirmed its commitment to George through a raft of new brand partnerships with In the Style, Missguided, Lee, Wrangler and Girls on Film, Drapers can exclusively reveal.

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No sale – Asda’s plans for George revealed