Return Culture: Customer Expectations & The Logistics Of eCommerce Returns
Thanks to changing customer habits, evolving shopping processes, and, of course, global lockdowns, eCommerce is booming bigger and better than ever. With a vast percentage of the public now turning to their smartphones or computers for every purchase, online brands are on the rise. From clothing to power tools, home décor to medication, practically everything can be purchased online and shipped directly to your door.
While this growth has been a significant positive for thousands of eCommerce businesses, with an increase in sales, there's also a need for a more robust and effective logistics system. While thousands of sales result in happy customers, many more transactions require a full returns policy and carefully planned logistics and eCommerce warehouse solutions. To ensure a high standard of customer satisfaction, an effective returns process is a must.
So, what exactly is 'Return Culture', and how does it impact the online shopping process and the brands that sell online? Read on to find out more about how customer expectations have changed, how brands need to adapt, and how logistics can be improved to account for this development today:
The Digital Customer Experience
Whether buying clothes or tech, a part of the shopping process pushed in-store has always been the 'experience'. Whether it's trying on an outfit in a dressing room or demo-ing a product before you purchase, shoppers are well used to the 'try before you buy' model. The advent of digital shopping may have changed the landscape of the customer shopping process, but it hasn't changed that deeply ingrained experience.
The result? Customers are more likely to buy something and then return it than ever before, with clothing and fashion in particular being sectors most likely needing to deal with customer returns.
Instead of trying on that dress in a shop changing room, customers are trying it on at home. Instead of testing out that camera on the shop floor, they're experiencing it for the first time at their front door. Return culture isn't anything new – it's just a new approach to an existing problem, bridging the gap between physical stores and digital marketplaces.
While UK consumer rights give customers 14 days to return most items purchased online, many retailers offer an extended return period of 28 days and 30, 60 or even 100 day returns are becoming more prevalent in certain sectors.
Whether it's buying multiple sizes of shoe to test for fit, or buying home accessories to see if they perfectly match your home décor, the ability to return items for a full refund – usually within five to ten working days – is an excellent boost to customer satisfaction, and provides a comprehensive service to customers that want to ensure a product is right for them. There's a reason why satisfaction guarantees and try-for-100-days policies are more prevalent than ever.
Changing Expectations
While returns themselves aren't a new concept, customer attitudes and expectations of the exchange process have hugely changed – making them more of a challenge than ever before for online stores and warehouses to manage the logistics involved. As the volume of returned parcels is growing more significant, the handling of returns often requires dedicated departments and services within large-scale companies in order to maintain high levels of customer service as well as managing inventory, keeping track of items and ensuring stock can be ready for resale as quickly and efficiently as possible.
While this may seem like an isolated trend, much of this change in expectations goes along with a drive to provide higher standards of customer satisfaction in all areas of online sales. Hundreds of thousands of parcels are being dispatched each day, from small businesses to massive corporations. As such, it makes sense that the volume of returns is increasing too. With the average household receiving multiple online shopping parcels a week, it's a foregone conclusion that more items will be returned.
Alongside an increase in volume, expectations around the speed of returns have also changed – as well as how returns are handled in the first place. With some brands now offering returns directly to the courier from home there's even more pressure on businesses to achieve a speedy turnaround on all returns and provide that higher standard of expected service.
The Logistics Of Returns
For many eCommerce businesses that have grown up through the medium of online shopping, the logistics of the returns process can be a finely-honed art. This means having dedicated departments focusing on problem resolution and returns, as well as providing customers with all the information they need to return items swiftly and effectively. In many cases, this means reusable packaging, returns slips included and multiple options for returning unwanted items.
However, that doesn't mean that the average company is working at peak service when it comes to their return logistics. While delivery logistics are often the focus – unsurprisingly, as the money comes from sales – return logistics can quickly fall behind, leading to more extended periods between returns and refunds and potentially unhappy customers. Rather than a sales workflow, returns are all about customer service. Provide your customer with a swift, convenient, and easy refund, and they'll be more likely to buy from you in the future.
But with rising customer expectations, increasing volume of returns and a need to deliver results faster to customers, even long-standing return services can be caught short. By evolving with your customer's needs, improving efficiencies and streamlining workflows in warehouse management and warehouse storage, achieving your targets and meeting the standards of your customers is achievable – it just requires a little work up-front.
With more companies than ever offering free returns to customers to stay competitive, it’s vital that the process can be managed as efficiently as possible to avoid costs snowballing. An efficient returns system encompassing fit for purpose warehouse design and inventory management can help to ensure that the resources required to handle returned items don’t make a dent in the bottom line of retailers on a scale that presents a challenge to profitability.
Improving Returns Logistics
The first step in streamlining and improving your existing processes is looking at what's working and what isn't. For example, utilising returns slips and reusable packaging may
The first step in streamlining and improving your existing processes is looking at what's working and what isn't. For example, utilising returns slips and reusable packaging may work for your business – the solutions could be scaled up or digitised to make the process faster, and ensure returns have a quicker turnaround. But in other cases, improving efficiency can mean diversifying from your existing workflows to create dedicated teams or services.
Warehouse shelving and storage can be a significant issue in the returns process, especially with sudden expansion or sales growth. Investing in additional warehouse space or creating a more extensive, dedicated returns shelving or storage area can help to resolve this issue. Problems related to item loss, the order returns were received and the overall efficiency of the process can be reduced using segmentation and separation. This is particularly important when it comes to achieving a logical order for returns – oldest to newest – as an unorganised warehouse can quickly lead to returns being processed out of order and some customers experiencing significantly longer turnaround times than others.
By working on efficiency, whether it's using digital workflows, automated processes, or simply scaling up your operations, achieving better results is easy. A tailored and intelligent system enables returns as well as initial sales to be processed and tracked efficiently, enabling for accurate inventory management and item location information to be available at all times. By evolving and increasing the efficiency of existing practices, and maximising the use and efficiency of existing spaces, you aren't wasting time building something from the ground up – and you're meeting demand at the same time.
Whether you're a small business or a huge multi-country company, putting time and effort into efficiency and streamlining your returns process can make a huge difference. Start with improving your logistics, and success is much more likely to follow.
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If you are involved in online retailing, contact Avanta to discuss our tailored eCommerce warehouse solutions which are designed to help businesses grow by delivering improved efficiency and capability in everything from storage and returns processing to picking and distribution.
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