E-retailers need to re-think their returns policies, Gartner says
In spite of the all the attention that retailers, vendors and consultants have paid to the issue of returned merchandise, e-retailers’ systems are not equipped to handle the anticipated flood, says a forthcoming report from e-commerce researchers and consultants Gartner Group Inc. Gartner estimates that returns will cost e-retailers $3.2 billion this year and will increase as online sales increase.
Gartner’s report, “How to Reduce the Cost of Returns,” recommends automated, self-service systems to help retailers reduce the cost of returns. Manually processing a return costs $32, Garnet says, while electronic processing costs $9. Among the steps that Geri Spieler, Gartner’s research director, recommends are encouraging customers to return to the site to fill out a return template, making sure the template lists all reasons for return and options such as refund, exchange, repair, etc. and printing out a return label with all the information from the template printed on the label along with a bar code.
Spieler says retailers can encourage their customers to go online to perform the return functions by stressing that it will make the return process easier and more accurate and it will start the replacement product’s journey to the customer sooner.
Spieler cautions retailers not to expect all their customers to go to a web site to start the return process. “Not all your customers will do any one thing all the time,” she says. “And you don’t want to force your customers to do it one certain way. But it doesn’t make any difference. If only 20% of your customers do this, you’ll still save money.”
Another advantage of offering an online procedure for returns is that it returns the customer to the store, Spieler notes. “It encourages cross-selling and up-selling,” she says.
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