Returns management has traditionally presented a challenge for retailers and consumer goods manufacturers around the world, with the average rate of returns staying steady at about 16.5% each year. With rising consumer expectations, streamlining the returns process is becoming increasingly important to meet customer needs. Fortunately, automation and artificial intelligence (AI) have made it easier than ever to manage inventory efficiently and reduce costly returns. By leveraging these powerful tools, companies can improve their sustainability efforts, lower overall returns costs, and create an optimal experience for customers who are returning items.
Consumers return many of the products they buy. One study by post-purchase platform company Navar found that 58% of consumers even intentionally buy more goods than they intend to keep. Consumer returns behavior is a complex and ever-shifting puzzle that many retailers and consumer goods manufacturers need to tackle. After all, understanding the psychology behind why customers make returns can help businesses better plan their strategies and operations to maximize profits. Diving into various elements of consumer behavior related to returns—such as impulse buying, need fulfillment, psychological triggers, and wider trends— can offer insights into how this behavior works…and allow you to get ahead of it.
It has become critical for retailers and consumer goods manufacturers to find ways to reduce the environmental impact of their operations. While there is plenty these companies can do in the supply chain to improve sustainability, they can also reduce the impact of returns while also decreasing associated costs. The transportation of returned goods is estimated to produce 15 million metric tons of carbon dioxide each year. It can be difficult to balance goals like sustainability and cost reduction, but with some careful planning and creative solutions, costs and environmental impacts don't need to compete when it comes to returns processes.
For retailers and consumer goods manufacturers, returns are an unavoidable consequence of doing business. It isn't just expensive to receive and process a returned item; it can also impact your bottom line if customers experience repeated issues with products they purchase from you. To reduce returns, providing effective product education is essential—and today, that can be done using online augmentation and visualization tools.
Retailers and brand manufacturers are continuously looking for ways to maximize their sales and increase customer satisfaction while minimizing returns. Among some of the powerful techniques to achieve this are loyalty programs, personalization, and marketing efforts.
Protecting the business against losses due to returns fraud and other dishonest activity is an ongoing challenge for retailers and consumer goods manufacturers. According to the National Retail Federation, of the approximately $212 billion of returned online purchases in 2022, $22.8 billion (10.7%) were fraudulent.
Sustainability is on the lips of every industry these days. With many experts now stating that mankind has foolishly missed the deadline and that climate change is now an inevitability, the mission switches from prevention to mitigation. In short, sustainability is good for the planet and good for business – something sportswear brand Adidas understands all too well.
Reverse logistics – which naturally includes customer returns – is becoming a major challenge for retailers and needs to be a point of focus for strategy development as we move into the latter half of 2022. Customer behavior is also creating issues for retailers and reverse logistics. Wardrobing – the act of buying an item for a particular occasion and then returning it afterwards – is very well known in the business. However, there is a new kid on the block.
There are many challenges facing reverse logistics in the modern retail industry. The increasing number of returns being driven by the proliferation of online shopping and customer practices such as wardrobing, and bracketing are increasing pressure on return departments daily. In this article we will discuss what an RMA system is, what it does, and why any ecommerce brand worth its salt in 2022 needs to have one implemented.
The jump in ecommerce shopping engagement brought about largely by the global COVID-19 crisis has resulting in a sympathetic spike in online fraud, with wily criminals discovering weaknesses and loopholes in process and infrastructure and exploiting them for personal profit. With National Retail Federation data from 2020 reporting that, of the $102 billion in ecommerce returns completed during the year - $7.7 billion was deemed to be fraudulent.
The number of products being returned to online retailers is skyrocketing, and with each return costing the company between $10-20, the damage to the bottom line can soon add up. Customer rights and good old fashioned human decency dictates that retailers must have some mechanism in place for products to be returned – but they need to make sure they are creating an environment where this needs to happen as little as possible.
Many items are simply not appropriate for resale once they are returned, usually for reasons of hygiene, and must be recycled or disposed of. Brands therefore need to come up with innovative strategies to properly dispose of returned items not fit for resale in order to avoid the environmental and reputational harm which comes with not doing so.
Amazon’s generous returns policy is partly responsible for the returns culture we are experiencing right now, so it only seems proper that the retailer also shoulder some of the responsibility for coming up with new ways of tackling the influx of returned products. Following up on how reverse logistics warehouses have a lot to learn from Amazon, let’s take another peek behind the scenes and see what this online behemoth is up to now.
As they continue to grapple with omnichannel purchases, retailers are applying analytics and identifying trends to learn how their product sales are performing across channels. Now they're looking to improve returns data and use it to drive better customer experiences.
Like many industries, warehousing is being transformed by the advent of digital technology. Manual processes are being replaced by automation, and advanced software such as artificial intelligence and the Internet of Things are making it easier and more convenient to process returned products.
Fashioning a circular economy will help industries create a better world. Reverse logistics has a key part to play & must work & innovate to make sure the products returned to them are reused and refurbished as much as possible, with disposal only ever being considered once all other efforts have failed.
As ecommerce grows, naturally, so too will the need to facilitate returns. In fact, the need for returning products becomes even greater with ecommerce as customers often don't know exactly what the product will look like until they're holding it in their hands.
Research by the NRF states that, of the 11% of retail products which are returned, 8% will be sent back to the point of origin fraudulently. The research in question focused on brick-and-mortar retailers, but it seems likely that the figure would be just as high, if not higher, when ecommerce is considered as well.
Digital technology is transforming industry all over the world. From restaurants to retail, innovative devices and software are helping businesses run more efficiently and serve their customers better than ever before.
Fault-free or no fault found (NFF) returns pose a massive headache for the retail industry, but Best Buy and Appriss Retail have come up with an elegant, if controversial, solution for these pains.
Climate change and green solutions are at the forefront of the strategies of many businesses who take their environmental responsibilities seriously, and Lenovo is using its own reverse logistics supply chain to do its part for the planet.
Marrying the power of the hugely popular Walmart App with its brick-and-mortar locations, the world's largest retailer by revenue rolled out Mobile Express Returns - an omnichannel returns innovation that slashes the time it takes for customers to return an item bought online down to just 30 seconds - in November last year.
With so many returned products ending up in landfills as waste, ecommerce marketplace Groupon formed a partnership with reverse logistics tech firm Optoro to boost its sustainability and keep returned and excess inventory out of the trash.