Four out of ten consumers will return “at least” one online purchase each month, a new report finds. That’s a lot of returns, which presents a challenge for any online stores with tight margins.
The process of accepting returns comes with plenty of expenses, according to this new data. Between the shipping, potential for product damage, and time spent on customer support calls, each return is estimated to cost the company between $25 and $30 (assuming the order cost around $100).
Starting your own ecommerce website or adding an online store to your brick-and-mortar establishment? Here’s the latest information to know about consumer behavior surrounding online shopping.
US Merchandise Returns Nearly Cost $744B Last Year
The news is out from retail tech platform Narvar, in the company’s recent 2024 State of Returns Report. After surveying 1,924 US consumers between the ages of 18 and 75, a series of insights emerged.
The 39% of consumers who say they return an online purchase at least once a month was the biggest stat in the report.
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For comparison, last year’s report found that 40% of consumers returned an online purchase two to three times per year. Here are some additional top takeaways:
- 46% of consumers purchase items online once a week or more
- Of those consumers, 87% do at least half of their shopping online
- Last year, US merchandise returns were nearly $744 billion
- 57% of shoppers submitted their most-recent return due to shipping and operational issues
The report also covered return fraud, noting that “52% of consumers have participated in return
fraud or abuse at least once in their lifetime.” Granted, this doesn’t mean it’s a huge concern, since it’s a lifetime stat, rather than a monthly one, but this statistic has increased a lot since last year’s report, when just 36% of consumers admitted the same.
The Value of Accepting Returns: Boosted Customer Loyalty
Accepting returns might come at a cost, but it’s worth noting the value behind the practice. And like a lot of the best practices when it comes to running a business, the long-term value is more difficult to put a price tag on.
“The returns process is often overlooked, but it holds incredible potential for driving customer loyalty and lifetime value. As our research shows, retailers who invest in optimizing their returns experience can transform this traditionally costly and burdensome process into a significant growth opportunity.” – Amit Sharma, CEO of Narvar
Customers aren’t returning purchases because they love costing retailers’ money, after all. Either, they have legitimate problems with the order, or perhaps they’re just trying to save a buck with an unnecessary return. Granted, one of those reasons might be more annoying than the other but taking a “customer is always right” approach will keep audiences happy.
Put another way, you can’t afford not to accept returns as easily as possible. As the report explains: “84% of online shoppers would turn their back on a retailer after a bad returns experience.”
Streamlining Your Returns Process
When accepting your own returns, try keeping some tips in mind in order to determine how to further streamline the process and keep your customers as happy as possible.
First, try accepting mail-in returns rather than only in-person returns: Needing to travel in order to drop off a return was the top reason consumers said they were annoyed with the process, with 38% saying as much.
If return fraud is a big problem for your store, consider asking consumers to take a picture of the damage when asking for a refund: 58% of consumers said this would stop them from making a fake return.
You’ll also want the entire ecommerce experience to be simple, easy, and fun, too: Check out our recommendations for the top website builders for small businesses to find the best software for launching your online store today.
