Product returns: A growth industry (part 1)


In the first part of a two-part series (read part two here) examining the value of convenient and cost-effective return policies for multichannel merchants, this week I provide tips on how to make company guarantees more effective, as well as looking at the benefit of determining why your customers are returning products.

Most consumers perceive the returns process to be a big hassle. Everyone who’s ever bought a product via mail order has at least one horror story about trying to return an item. But, I’ve also heard the opposite. In fact, I’ve heard people brag about how easy the return process is when they’ve had an exceptional experience. Personally, I’m always pleasantly surprised when something I return goes smoothly.

You must have a clear, concise return policy with exceptional customer service when handling returns if you want to compete today. And with the emergence of multichannel marketing, that return policy needs to be seamless throughout all your channels no matter where the purchase is made.

Guaranteed Success:

Take a close look at your guarantee. Can it be stated easily? If it’s too complicated, make it simpler. Make it so easy to understand that if you read it to children, they’d instantly get it.

Also ask yourself these two questions:

1.  Do you state your guarantee and return policy clearly?

2.  Is it easy to find?

Try this test: Ask someone not in your organization (because I know you’re aware of your own policies) to find them and report back to you. You may be surprised in what you hear.

If your customers feel your guarantee is solid, they perceive less risk when ordering. By reducing the risk, you make it easier for customers to say “yes” to your offering.

You’re Returning This Because?

Most companies’ enterprise software helps track why customers return products. If you don’t know your product return reasons, learn them. By understanding the reasons why your customers return your products, you can make some powerful changes.

For example, a company I worked with analyzed its returns and discovered that the manner in which the product shots in its catalog were photographed weren’t representative of what people received in the mail. By changing how it photographed its products, the company was able to decrease its return rate. The net result: more gross profit!

Click here for the final part of this two-part series, where I delve into how in-house quality control, product exchanges and catalog circulation can impact your organization’s return practices.

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3 Responses

  1. I feel you covered your topice well. Ease of return and evaluation of returned merchandise is “key,” to determining percentage of returns.

    Your example at the end was good. Having had a marketing company for 15 years in CT, it doesn’t change much except for learning how to market effectively on the Internet.

    Maralyn D. Hill, $uccess, Your Path to a Successful Book, http://www.BooksByHills.com, http://www.noralyn.com/blogger/success

  2. Good ideas for topics !

  3. Returns is definitely the biggest hassle I face on a regular basis. However, it has more to do with dealers returning than end-users. We launched our product this year with a buy-back guarantee. There was an end-date stated, but I found out way too late that most reps didn’t communicate that part of the guarantee, and therefore I’m still receiving returns from dealers (who probably didn’t put much into selling the product) two months after I supposedly was putting my foot down. Hindsight being what it is, there are so many things I would do differently.

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