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Self-service returns: What they are and why retailers should offer them

A customer looking at a laptop computer and printing out a shipping label to return a package

Returns are the bane of retailers’ existence. But that doesn’t mean that the returns process shouldn’t be as easy as possible for customers to navigate. With seamless returns management, both brands and consumers will face greater convenience and less frustration during the post-purchase experience. 

Easy returns don’t just increase customer satisfaction. They also increase the likelihood of customers choosing to exchange rather than return items, hence maintaining a relationship with your brand. According to Narvar’s 2019 study, consumers are more likely to make exchanges if: 

Reasons customers are more satisfied with a refunds process

So, what is the best way for retailers to achieve seamless returns and exchanges? By introducing a self-service returns system that puts the customer in control of the returns journey.

What are self-service returns?

A self-service return is a form of customer self-service where the customer is able to complete a return without needing assistance or authorization from a customer service representative. This streamlines the returns experience and makes it easier for customers to get their desired outcome e.g. an exchange, a store credit, or a refund.

With self-service returns, brands don’t need to rely on their customer care teams to do the heavy lifting; empowering the customer to take charge of the process from end to end creates a true customer-centered returns experience.

Why your brand should be offering self-service returns

Customers like to take charge of their own experience

Great customer service is no longer defined solely by attentive customer care representatives. Today, it depends on your ability to equip customers with the tools they need to address issues themselves. 

According to Bizreport, 73% of consumers say that they want the ability to solve product or service problems on their own. A further 60% say they prefer using digital self-help tools to contacting a customer service representative directly.

By giving customers the technology and flexibility to manage returns themselves, you can increase customer satisfaction and create a much easier returns process. It’s worth remembering that a whopping 92% of consumers will buy from a merchant again if the return process is easy!

It’s easier for customers to make exchanges

Giving out refunds is a situation that most merchants try to avoid. But if this is done via negative reinforcement i.e. punitive returns policies, this is only going to sour customers’ perception of your brand.

The alternative is to use positive reinforcement in the form of an intuitive, self-directed returns process that makes it easy to exchange returned items. Customers can select the products they would like to exchange and those they would like to return, rather than relying on a customer service representative who could slow down the process.

It’s worth noting that customers prefer to make exchanges more often than you might think; nearly two-thirds of consumers plan on exchanging or finding a replacement for an item they’ve returned, either via the same retailer or a competitor. Whether it’s the former or the latter depends on how your customer approaches the returns process.

It frees up returns bottlenecks during peak season

Processing returns puts a huge strain on customer care teams even during quieter parts of the year. But during peak season, this can quickly become unmanageable. As order volumes increase in the lead-up to the holidays, seasonal returns will inevitably follow. In 2021, what was traditionally known as ‘National Returns Day’ became National Returns Week, with an average of 1.75 million packages returned for five days in a row during the week of January 4, 2021.

In this climate, having your team vet and approve returns, generate shipping labels, and communicate return instructions for individual orders is inefficient and causes returns to pile up. This undermines your relationship with customers, in addition to causing your brand to miss resale opportunities.

With a self-service return option, you can avoid long processing times by allowing your customers to direct this process instead of your customer care team. This frees up valuable time to spend handling more complex service requests.

How do self-service returns work?

Before we look at how self-service returns work, we need to understand how a regular returns workflow operates. This is also known as an authorized return.

Authorized return workflow

Let’s say you’ve just bought a pair of pants online and found out that they’re the wrong size. To make a return, you first need to contact the merchant with a return request to obtain an RMA (Returned Merchandise Authorization). You’ll need to volunteer certain information about your order, such as:

  • Personal details
  • Order number
  • The item(s) being returned
  • The condition of the item
  • The reason for returning

A customer service representative will then consider your request and decide whether or not it falls under the brand’s return policy. They may also check your order history to see if there’s a repeat pattern that may indicate returns fraud. Once the return is approved, you’ll be provided with full return instructions and a return shipping label in the case that the merchant is offering free returns shipping. 

The purpose of an authorized return is to give customer care teams a gatekeeping role during the returns process to prevent returns fraud, which cost merchants an estimated $25.3 billion in the United States in 2020. It also provides an opportunity for brands to boost their exchange rate by offering alternative product options.

However, authorized returns do have a downside. 

Making customers justify their reason for returning and requiring advance approval adds a huge amount of friction to the returns experience. If a customer has been converted on the prospect of a ‘hassle-free’ returns process, this can make your brand look dishonest. Once customers know how time-consuming it is to make returns, they’re unlikely to want to shop with you again. 

In sum, authorized returns take power away from your customer and put it in the hands of a faceless representative. In the age of customer-led shopping journeys, this strikes a very discordant note. Despite this, 32% of customers report needing to contact the retailer to obtain return authorization.

This is where self-service returns are a breath of fresh air to customers who just want their returns processed quickly and efficiently.

Self-service return workflow

In contrast to authorized returns, a self-service return is under the direction of your customer from beginning to end. The workflow will depend on whether the return is being completed online or in a physical store setting (yes, it is possible for self-service returns to be done in-person!)

Via an online returns portal

In this model, customers will either progress straight to the returns center on the merchant’s website or via a link provided in their confirmation email. Once there, customers can initiate the return by providing their online order number and selecting which items they would like to return or exchange. RMA will be granted and a return shipping label generated to allow customers to make their return straightaway. 

If customers have outstanding credit, some return portals will direct customers to a product catalog within the returns portal to provide suggestions for what they could purchase instead. This creates a closed loop where customers are redeeming store credit on fresh online purchases that would otherwise be lost to refunds. 

Via an in-store returns kiosk

Although still an emerging offering within brick and mortar, self-service return drop-offs are picking up steam. This is both due to the COVID-19 pandemic and efforts by retailers to reduce bottlenecks at checkouts.

All signs show that consumers are big fans of this shift. 40% of consumers say that it’s easier to return items in-store, with nearly a fifth saying that they wouldn’t purchase from a retailer that doesn’t offer in-store returns.

By eliminating the traditional lag between returning an item and receiving an exchange or return, retailers can enhance the customer experience and encourage repeat purchasing behaviors. 

Rent the Runway is currently experimenting with in-store returns kiosks that offer customers a convenient, socially distanced returns method at partner retailers, including Nordstrom. All customers have to do is to scan a barcode on the garment they rented and drop it into the returns bin. Kiosks are also capable of facilitating refunds either via credit card or the customer’s preferred payment method.

Brands that don’t have physical stores or partnering locations don’t have to say goodbye to the prospect of in-store returns altogether. Whiplash integration partner Happy Returns offers merchants a network of in-store return points within convenient locations such as pharmacies or grocery stores, enabling online sellers to consolidate their returns and ship them to the warehouse with effective routing.

The dos and don’ts of introducing self-service returns at your online store

DO: Make your returns policy clear to customers

When offering self-service returns, you should make this clear from the outset. Hosting a clear and comprehensive returns policy and FAQ page in a prominent location on your website helps to prevent confusion when customers are searching for returns information. According to a survey by Loop, knowing how to start the return process is one of the top things that customers look for in a returns policy.

Not only does a well-written returns policy provide clarity to your customers; it’s also a fantastic selling point. With 49% of customers checking a merchant’s return policy before purchasing, this is a clear indicator that the ease of returns plays a major role in your ability to convert.

You can find out more about how to create a comprehensive returns policy here.

DON’T: Withhold what customers need to initiate a return 

To implement a true self-service solution, customers need to be able to initiate a return the moment they decide it’s necessary. If they still have to reach out to your team to obtain access to a returns portal, this defeats the whole purpose of customer-directed returns.

Instead, you should make an effort to include relevant returns information within the customer’s initial order confirmation. This is a vital touchpoint within the ecommerce experience that provides your customer with a roadmap on how to navigate the post-purchase experience, turning possible areas of friction into seamless brand interactions.

The Whiplash platform makes it easy for brands to take a proactive approach to returns by opting to embed branded return links within your customer’s shipping confirmation. In addition to providing them with reassurance that their order is on its way, being transparent about the returns process with your customers increases trust and helps to minimize anxiety during the post-purchase experience. 

DO: Use a returns management tool 

Investing in an advanced returns management tool with automation capabilities will make it far easier to offer a robust self-service solution to your customers. Third-party return solutions give retailers an all-in-one package, including branded return portals, one-click exchange capabilities, and advanced analytics to understand what is driving your return rate. 

Best of all, a returns management tool does all the heavy lifting because it automates processing and gives you full visibility over outstanding returns. Whiplash offers seamless integrations with Happy Returns, Returnly, and Loop.

DON’T: Allow for automatic returns 

To create the ultimate self-service returns solution, it’s tempting to take the approach of planning for a return from the outset of fulfillment. This involves providing a return slip and return label with outbound orders, as well as return-ready packaging if needed. Automatic returns are a common strategy amongst fast-fashion retailers whose revenue model requires extremely high volumes of sales, but who don’t have the capacity to process a corresponding number of returns. 

While this is extremely convenient for your customers and will increase satisfaction, this policy does have some downsides. 

If customers don’t need to notify you in advance of returning an item, it’s incredibly difficult to prepare for a spike in returns activity ahead of time. Moreover, customers may provide scant information on their reasons for making a return – or none at all – making it impossible to identify issues that are driving returns. 

By using a self-service returns model, brands can streamline the returns process while still making the most of a valuable post-purchase touchpoint with customers. Instead of simply waving a customer goodbye, you have the opportunity to extend the relationship into a new sales cycle. Empowering customers to manage returns themselves encourages them to interact with your brand on your own terms, which increases trust and loyalty.

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