Heikki Haldre, CEO and founder of virtual fitting room provider Fits.me discusses how e-commerce businesses can handle the issue of returns over the Christmas period
During the busy Christmas period, retailers’ sales can more than double. The problem is: so do their returns. If retailers want to achieve profitability from Christmas sales, as well as increase brand value and customer loyalty, I would argue that minimising returns is essential.
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Why do people return purchases?
Retailers document myriad reasons for items being returned: item doesn’t fit, garment not flattering, item doesn’t work the way it was expected to, quality not as expected, colour not as displayed on screen, and so on.
And, over the Christmas period there is the obvious addition of an item being given as a gift and the receiver simply doesn’t like it!
Taking the clothing sector as an example, returns average approximately 25% of apparel e-commerce sales. The Drapers e-tail Report found that 74% of people name fit as the main reason for returning items of clothing.
Ultimately, most reasons boil down to fact that the buyer’s expectations of the item have not been met for some reason.
Reducing the need to return
As innovative technologies reach an acceptable level of maturity, retailers can improve the shopping experience both online and in-store, thereby guiding customers to make the best purchases and reduce the likelihood that a purchase fails to meet expectations.
If a significant source of returns is unwanted gifts, retailers may need to develop means to connect the gift giver with the gift receiver – to share a list of what their loved ones actually want.
Consider the success of tools like Amazon’s Wish List and other social tools and apps where people curate gift lists. Ensure that your product listings and photographs have sharing and list functionality enabled.
If your returns issue is linked to consumers receiving an item that for some reason was not what they expected, you may be able to nip returns in the bud. Give your shoppers better product information: making it accurate, provide more of it, and help them to find more information for themselves.
Take clothes. Product information for clothes takes a wide variety of forms including cost, appearance, availability, cost, quality, functionality, colour, texture and size.
In-store, this is straightforward: items may be touched and seen ‘in the flesh’. Online however, some of this is more difficult. Product descriptions must vouch for attributes such as quality and functionality.
Good photography will, in most cases, provide reassurance regarding an item’s appearance and colour. Consumer reviews are also helpful, particularly in the consumer electronics and literature sectors.
For tricky attributes such as fit and texture, Virtual Fitting Rooms provide consumers with an accurate visualisation of fit, while Senseg are developing responsive tactile surfaces for tablet computers and smartphones that help to communicate texture.
Providing better product information gives shoppers more confidence in their purchase, whether it’s an item of clothing of an item of consumer electronics or a kitchen gadget.
And it’s still fact that the best place to collect such information remains, for the time being, in a physical store, where there is assistance and physical items to hold, touch and understand.
As online sales become a more significant proportion of overall purchases, to minimise returns retailers should simply aim to deliver the same level of customer service and personalisation when selling items online as when they are selling offline.
There are lots of innovative technologies available to help retailers to do this, from consumer reviews, to connecting prospective purchasers to existing owners, to virtual fitting rooms. To ensure that returns don’t haunt you in 2014, go and explore them.
For more information visit Fits.me
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