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Adopting the right returns strategy for seamless omnichannel ecommerce

illustration of a person standing at a table using a laptop. a shipping box with shoes in it is next to them. the happy returns logo is above the box.

This blog is an extract from our latest ebook, ‘The Digital Transformation (DX) Revolution: Growth Strategies for ecommerce Brands and  Retailers,’ by Whiplash integration partner, Happy Returns by PayPal, a comprehensive returns automation solution for online and omnichannel retailers.

Ecommerce has seen a remarkable acceleration in growth as a result of the COVID-19 pandemic. Ecommerce in the United States grew 14.2% between 2020 and 2021, with a forecast growth of 50% over the next four years

This is great news for merchants. But there’s also a downside: more sales mean more returns. If you can’t manage returns effectively, this doesn’t spell good news for your bottom line. 

McKinsey & Company has called omnichannel “the path to value” for retailers but also warns, “retailers can invest in the wrong thing and quickly fall into a downward spiral that can destroy value.”

Consumers want seamless ecommerce solutions that work across all channels. A key part of this strategy – especially for D2C brands in apparel, footwear, and accessories – is to give consumers a simple and efficient way to handle returns and exchanges.

The challenges of creating a better return experience

With consumers relying on online shopping more than ever to meet their needs, how you approach return management can be the determining factor in whether a customer chooses to shop with you again. Research from global payments service Klarna found 83% of online shoppers admit to getting frustrated with retailers that have an inefficient returns process, while 84% will reject those that deliver a poor returns experience.

In sum, today’s shoppers have very high expectations—and underperforming means putting your business at risk.

Unfortunately, dealing with returns and exchanges can be a costly and time-consuming challenge for merchants. Common pain points include:

Managing costs

Thanks to the likes of Amazon, shoppers have come to expect free returns. But the question is: can you afford it? 

Return shipping and handling costs are continuing to rise. The inundation of endless returns-related inquiries to your service center also adds up, especially if your team is spending a significant amount of time manually generating return labels or answering questions like “where is my refund?” 

This puts brands in a tough position. Shouldering all of these expenses can easily result in your business making a loss. But not taking on these expenses can be off-putting for potential customers.

Initiating refunds

When shoppers decide to pursue a refund, they want their money back immediately. Refunding at the time of carrier scan keeps your customers happy, but there’s a problem; you don’t know what’s coming back. This makes it very difficult to make accurate inventory forecasts and know what SKUs are suitable for resale.

However, waiting to process a refund until the warehouse inspection leads to frustration, increased customer service contacts, and ultimately, impacts shopper retention.

Processing returns

Because they’re busy focusing on outbound orders, merchants often overlook the importance of streamlined reverse logistics. 

However, mail returns can be complicated and time-consuming for your 3PL to manage. Shipping orders to your warehouse individually is expensive, and a lack of visibility into the status of each return leaves your operations and service teams in the dark. Your team doesn’t know when to expect returns or what sort of reconditioning services may be needed, which is problematic during peak sales times like Black Friday.

Improve returns by putting yourself in your customer’s shoes

When you purchase an item online that’s the wrong size or color or that you’re simply not happy with, you want to exchange or return it immediately with minimal effort. Yet seamless return and exchange experiences in ecommerce can feel few and far between.

After all, no merchant wants to see hundreds of orders coming back into their warehouse each month. This means there can be an overwhelming temptation for brands to find ways to limit returns, such as short return windows or only allowing exchanges or store credit. 

While this might have the effect of reducing returns, it also creates some unintended consequences – namely, that many consumers will choose to steer clear from purchasing from your brand in the first place. 

The answer? Giving your shoppers a fast, efficient path for returns and exchanges enhances the customer experience and nurtures brand loyalty. This is why more leading retailers are choosing to outsource to a return automation software and reverse logistics platform such as Happy Returns by PayPal.

The benefits of using Happy Returns by PayPal include the ability to:

Delight shoppers. Automate your returns process with a flexible, consumer-friendly, and merchant-branded returns portal that removes the friction of online returns for your customers. Top it off with instant refunds when shoppers bring their items to one of 3,800+ Return Bar locations nationwide.

Save money. Cut your shipping costs by an average of 20% compared with mailed returns, thanks to consolidated shipments from Return Bar locations. 

Retain revenue. Offer your customers intelligent, one-click exchanges based on return reason and available inventory to help you retain more of your sales revenue.

Boost sustainability. Beyond the reduced waste achieved by aggregating multiple returns into one shipment, Happy Returns replaces cardboard boxes with reusable totes, helping customers reduce greenhouse gas emissions by 120k lbs for every million returns.

a happy returns sign next to an escalator. the sign says ‘don’t worry, return happy.’

With global ecommerce continuing to rise dramatically and the costs and complexity of returns only increasing, it’s critical for brands and retailers to identify the right return and exchange solution to drive your business’ success. A streamlined, customer-centered return process can be the difference between attracting one-time shoppers or repeat purchasers that deliver long-term value for your business. 

To learn more about Happy Returns and how to save up to 40% on e-commerce returns, let’s get in touch! 

Enjoyed this extract? Check out the rest of our eBook on how the digital transformation of online storefronts is creating new opportunities to retain revenue and build customer loyalty.

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