Free Returns: What Does Your Consumer Want?

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By Published On: January 22, 20190 Comments

What does a consumer-focused returns policy mean if you don't actually know the expectations of your consumer? Research reveals what your consumer expects from you.

Retailers know that a key element for conversions is a generous returns policy. Whether that’s free returns, convenient returns, returns for change-of-mind purchases or simply a long lee-way for returning items, these have all become points of difference for online retailers to remain competitive.

In recent research conducted in a soon-to-be published report, Power Retail has established that around 7 percent of all orders made by Australian online shoppers are returned. But what does your consumer actually want when it comes to a consumer focused returns policy?

Research commissioned by CouriersPlease has found that pricing is a major pain-point for shoppers who want to return items. Fifty-three percent of shoppers surveyed would not be willing to spend on postage or courier to return an item.Only one in three (33 percent) said they would spend a maximum of $10 a return with 13 percent willing to pay more than $10 on postage or courier while 37 percent prefer to return an item in-store.

When it comes to in-store returns, Millennials were the highest demographic with this preference (47 percent) while the lowest (23 per cent) was amongst 50-something shoppers. Twenty-seven percent of respondents liked returning items to a Post Office or parcel drop off point such as a newsagent or petrol station.

“The high return rate in the online shopping sector is here to stay,” says Head of Commercial and Transformation at CouriersPlease, Jessica Ip. “As consumers lose the touch-and-feel aspect when buying online, they can erroneously purchase the wrong size or colour, their expectations for texture or quality might not be met, or they might simply change their mind altogether once the product is in their hands.”

Power Retail’s research has provided further insight on this topic, with incorrect fit and colour the most common reason (48 percent) cited by shoppers for considering returning an item. It’s not surprising then that 38 percent of Australian online retailers have found improving product photos and descriptions on their websites to be the most effective strategies for minimising returns.

With a potential global economic slowdown looming, online retailers will be forced to reduce operating costs to remain competitive. “Customers don’t want the hassle of returning items, and retailers don’t want the costs,” says Mark Fletcher, Insights Manager at Power Retail. “A multipronged approach to reducing returns has the potential for a win-win outcome.”

Deliveries and returns are both a major hurdle for Australian retailers but also a huge opportunity. Power Retail’s Spotlight Series reports each address a key e-commerce challenge. The series, based on surveys of thousands of shoppers and retailers as well as an expert retailer panel, provide an invaluable resource to remain competitive and stay ahead of the game. Want more insight? Make sure you are notified when the Spotlight Series Report, Returns – Win/Win Opportunities is being released by signing up to our mailing list here.

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About the Author: Power Retail

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