How can retailers optimise returns?

Online returns can be a headache for British retailers today.

But merchants that fail to provide consumers with easy returns risk losing a large proportion of their customer base.

According to payments provider Klarna, eight out of 10 online shoppers in the UK said they would not shop with a retailer with which they have had a bad returns experience.

Klarna UK general manager Luke Griffiths says: “Consumers today demand a frictionless experience when shopping online – whether they’re browsing, paying or returning.

“Where returns were once an unwelcome cost of doing business, today they’re an important competitive differentiator for merchants, who must optimise their processes or risk being left behind”

Luke Griffiths, Klarna

“So where returns were once an unwelcome cost of doing business, today they’re an important competitive differentiator for merchants, who must optimise their processes or risk being left behind.”

‘Buy to try’

Griffiths believes that the rise of ecommerce has sparked a revolution in consumer attitudes towards returns, with a ‘buy to try’ mentality emerging.

“Increasingly, we see shoppers turning their sitting rooms into fitting rooms, ordering multiple items to try and then sending back what they don’t want.”

The good news for retailers is that there is a sizeable prize for getting returns right.

“Regular returners are more valuable customers for retailers – making more frequent purchases with a higher overall net purchase volume, even after the value of the items returned has been removed”

Luke Griffiths, Klarna

“Klarna data shows that regular returners are more valuable customers for retailers – making more frequent purchases with a higher overall net purchase volume, even after the value of the items returned has been removed.

“This is echoed by consumers – two thirds said free returns mean they will buy more from a retailer over time, while a quarter said they would spend more with an easier online returns process.”

Linking the returns and payment processes can give merchants an added competitive edge.

“To reap the greatest rewards, retailers should combine smooth returns with an option to pay after delivery – so shoppers can try it, love it, then pay for it,” says Griffiths.