Do you know how to reduce your returns rates? The latest consumer research reveals exactly what shoppers are returning and why.
Each fortnight, Power Retail surveys over 1,000 Australian online shoppers, to provide Switched On members with real-time access to the latest data and consumer insights. We regularly look into all elements of the purchase journey, covering everything from product discovery to returns. One of our more recent surveys, which we covered in Trajectory #46, revealed that around 27.4% of Aussie online shoppers say they have made a return in the last 6 months. That returns rate is essentially identical to the same period in 2021.
What Items Are Being Returned?
Fashion purchases are the most common, with 62% of those surveyed saying this was what they recently returned. This figure has also remained steady year-on-year (previously 65% in 2021). While fashion is consistently the most popular purchase category, it is heavily overrepresented when it comes to returns, given only 13% of respondents said electronics items (the next most popular category) were in their last return.
It makes sense that fashion would be more likely to be returned given its price point and that it is easier logistically to return a pair of jeans than a juicer. It does mean that fashion retailers in particular have work ahead of them to reduce returns rates.
Source: Power Retail Switched On Trajectory Report #46
The survey also found that around a third of consumers (34%) pay for postage when they return an item they bought online. This figure has remained steady since 2020. This obviously means that the majority (66%) don’t pay for postage when they return an item purchased online. The most common way items are returned is by post or courier, with 73% of returns made this way. This figure has also remained steady in the last few years (from 76% in 2020).
Twenty percent of respondents said they returned their items purchased online to a physical store, showing how the multichannel model encourages more flexibility with returns. Drop-off points are far less common for returns, steady at 7%.
What’s Driving Returns?
Change of mind purchases only accounts for a very small percentage of returns (8%). The majority (62%) said that they returned products because the item purchased didn’t fit or looked different online. This figure has remained largely unchanged for three years running. It shows that there is still work to be done when it comes to the basics like product descriptions, size guides, product imagery and more. ‘It was faulty’ comes in second place at 19% (a big difference between the 62% who say they returned an item because it didn’t fit or looked different online).
There is a perception that returns are driven by consumers who simply place an order and then change their minds, meaning it is a consumer ‘whim’. In fact, what we can see is that returns are a result of retailer behaviour, either because the goods purchased are faulty, or, (more likely) because of the gap between what the consumer expected when placing the order and what arrived. The positive here is that it is within the control of retailers to lower these return rates.
Find out more in Power Retail’s Switch On Trajectory Report #46. Jam-packed full of the latest consumer insights as well as e-commerce benchmarking data and more.
Curious? Feel free to join our fortnightly Market Update, in which we present findings from the most recently published Trajectory Reports. FREE to join (for both Switched On members and non-members), and just 15 minutes! Our next Market Update will take place on Wednesday 29 June at 1 pm. Register here.
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