Top Five Tips to Turn Your Holiday Returns Into Sales

Returns are part and parcel of e-commerce businesses. One in every three online sales comes back as a return. The National Retail Federation estimates about 10% of items purchased during the 2015 holiday season coming back as returns.

Businesses have good reason to dislike returns. The not only represent lost sales, they also negate the time, effort and money required to close the initial sale and fulfill the order. However, savvy retailers are striving to convert returns into fresh opportunities and loyal customers. Offering a prompt, efficient, no-hassle return policy enhances consumer confidence in the brand and will likely lead to repeat business.

Here are some tips for handling returns efficiently and maintaining a positive customer experience:

Clarify Expectations

The basic rule for cultivating customer loyalty is clarity. Never mislead customers or leave things vague. State the return policy clearly on the website, in the FAQ section, product page, and preferably in the shopping cart as well, without hiding it in the fine-print. Repeat the policy on the shipping receipts as well.

There is no hard and fast rule as to what constitutes the best return policy. As a general rule-of-thumb, however, companies should make it easy for the customer to initiate a return and provide a specific time-frame for processing it. While a no-questions-asked, full refund policy may generate lot of returns, it will also generate good will and boost future sales.

Have the Right Systems in Place

One sure way of delighting the customer is to process the returns in double quick time, even during the busy holiday season. E-commerce retailers should plan ahead, using their typical holiday return rates to make a reasonable estimate of the expected volume, and have the infrastructure in place to process it quickly. For instance, when hiring temporary staff to handle the seasonal rush, consider both seasonal sales as well as the projected return volume.

While processing returns efficiently is important, it’s only half the battle. The second half involves placing returned items back into inventory to ensure optimal performance and maintain profitability. E-retailers need a defined strategy for differentiating items that can be resold, items which should be discounted for resale and items which need to be recycled and/or which fall into some other category.

Have the Right Technology in Place

Adopt technology that makes it easier for the customer to make a return. For instance, instead of limiting customers to use one or two “approved” logistics companies to return a shipment, allow customers to ship through any channel of their choice and offer shipping credits.  

Make sure technology is in place to honor the stated return policy commitments. For instance, if full refunds are promised, make sure the system processes the full refund as quickly as possible. Make transparency a priority and keep customers informed at every stage of the refund process, through SMS, online tracking mechanism, or any other preferred method.  

Listen to the Customer

Even after careful planning, glitches sometimes happen and customers will have questions. The best way to handle such eventualities is to have a well-trained and responsive customer support team who is willing to listen to the customer and sort things out.

Listening offers multiple benefits. Apart from being able to resolve the issue to the customer’s satisfaction, it allows the retailer to understand more about the customer. Of course, customer service agents need to capture such information so it can be analyzed and used by marketing and others.

Communicate with the Customer

In today’s hyper-competitive world, customers are bombarded by literally thousands of sales messages daily. So when a customer reaches out – even if it’s to initiate a return – it’s really an opportunity establish a closer relationship. Ask why the customer is making the return and provide options that match expectations more closely. Depending on the circumstances in which the refund is being made, it may be appropriate to try a cross-sell or offer a partial discount in lieu of refund.

At the end of the day, returns are inevitable, costly and a hassle for both retailers and customers. However, learning to process them as efficiently as possible and with a smile can be worth the effort. A meaningful and easy exchange experience offers a win-win solution for both the retailers as well as the customers as about 95% of customers will likely buy again after experiencing a “positive return”.

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