Customer returns are a headache at any time of year, but our data shows it's also seasonal. The most significant return spikes through POS are in January and summer, likely related to purchases made during the holiday season and spring-summer sales. For ecommerce, we see a similar trend in returns– spiking around the holiday season, spring, and summer months.
% of online and point of sale returns in 2022 and 2023
There's good news. With the right system in place, you can streamline the returns process, reduce retail fraud, and open opportunities for new sales. This blog will look at some easy ways to do that.
Use referenced refunds for online and in-store purchases
Two types of refunds exist: referenced and unreferenced. Referenced refunds are linked to the original purchase, whereas unreferenced refunds require manual reconciliation afterward.
Ecommerce platforms typically reference refunds, because they have a digital record of the customer and their purchase.
To process reference refunds in store, more work is involved. Merchants have to refund the card and reconcile the refund manually later. This takes time and resources.
Fortunately, it's now possible to reference your in-store returns as well. Financial technology platforms like Adyen automatically connect the customer card to the purchased item, so returns are reconciled easily. The customer doesn't even need to show their card.
Allow cross-channel returns
Returning items is a chore. Allow your shoppers to do returns at their convenience. Offer your online shoppers the option to return items in store and your store shoppers the option to return items to your ecommerce warehouse.
Flexibility provides a better experience. It removes barriers at the initial purchase if they know the return process is straightforward.
You must have a single view of your shoppers' purchase history to support cross-channel returns. That way, you can reconcile an online purchase in-store and vice versa.
Simplify managing in-store and online payments with a single system like Unified Commerce to accommodate cross-channel returns.
Avoid retail return fraud with centralized payments
In the US alone, return fraud contributed $101 billion in overall losses for retailers in 2023, which means $13.70 lost to return fraud for every $100 in returned merchandise.
Among the types of return fraud retailers have experienced, 44% cited the return of shoplifted or stolen merchandise. This increasing trend is due to the poor connectivity between systems.
To minimize retail return fraud, reconcile the return claim with the shopper's history on the spot. Centralize your payments to link shoppers to their purchases regardless of channel. This will tighten your defenses and reduce the risk of fraudulent return claims.
Convert returns into sales
Whether the shopper visits your site to read your returns policy or brings unwanted items into the store, there is an opportunity to re-engage with the customer.
The first step is to ensure a smooth return process. By consolidating your payments data, you can process customer returns quickly and easily.
Now that you have a complete view of the customer’s shopping history, you can target them with relevant offers and convert the return into a fruitful shopping trip.
It’s time to take action
Whether it's the wrong size, receiving an unwanted gift, or a change of mind, shoppers want to return items. Retailers can embrace these opportunities to improve customer satisfaction, limit fraud, and gain valuable consumer insights.
The strategies above can help you deliver a seamless, hassle-free returns experience for your customers and your business. If you want to take your customer returns above and beyond, it's time to take action.
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