It’s not enough to just ask customers what they think of returns charges – everybody wants free stuff!
Our most recent data collection on mainstream apparel retailers in the UK zoomed into their CX to look at post-purchase friction including returns. Here are some key findings:
- There is a big opportunity in the returns space
- No UK apparel retailer is currently owning returns
- Price is not the only post-purchase factor influencing customer behaviour
Returns charges - new norm?
Earlier this month New Look announced a trial charge for postal returns, joining a growing number of mainstream apparel retailers -Zara, Next, Boohoo, Mountain Warehouse, Mos Bros, Uniqlo – who have done the same.
Rising supply chain costs and pressure on consumers from the cost-of-living crisis are leaving apparel brands with a difficult choice – pass on rising costs to customers (H&M and Next have recently announced price rises) or offset that expense elsewhere.
The big returns problem
Over the last decade, consumers have got used to free online returns as retailers scrambled to remove purchase friction. The result is a £7bn logistical nightmare for apparel retailers:
- One in three fashion items bought online sent back
- Growing environmental impact of shipping
- Returned clothing often not resold
When customers expect free returns, adding a returns charge introduces a friction into the shopping journey , especially at a time when people are looking to cut their spending.
But when retailers have little choice financially but to start charging for returns, crucial questions need answering by customer analytics.
- What is the impact of returns charges on customer behaviour?
- Is the negative impact of a charge offset by the cost-saving?
- What other CX changes could be made to further offset the negative impact?
It’s not enough to ask customers what they think of returns charges – everybody wants free stuff! What retailers really need is customer experience analytics solutions that show the true impact of changes to variables in this area of CX.
Retailers should be looking at post-purchase as a massive opportunity to gain advantage over their competitors right now, even if exploring returns charges is unavoidable.David Grimes, Sorted Founder & CEO
Returns: a massive opportunity?
The delivery experience (including returns) makes up 35% of the overall customer journey experience, according to neuroscience research by delivery experience platform Sorted and consultancy ThinkBeyond.
Sorted founder and CEO David Grimes told us, “Retailers should be looking at post-purchase as a massive opportunity to gain advantage over their competitors right now, even if exploring returns charges is unavoidable. A positive returns experience is not just about price, it’s about the whole delivery experience being a differentiator. Customers want a simple, smooth, transparent process, flexible returns options, sustainable packaging and clear communications straight from the retailer. A difficult returns process can lose a customer forever, a smooth one can incentivise them to buy more.”
Uncrowd data reveals the opportunity gap
Uncrowd’s most recent mainstream apparel data set shows that returns is an area of massive opportunity for UK apparel retailers.
Of the ten UK mainstream apparel retailers we compared, none are currently owning this space.
Next Online are leaders of the pack. They sneak out in front on:
- Clarity of returns process
- Generous and clear returns policy
But Next are closely followed by M&S, George @Asda and H&M. The gaps are tight, and absolute scores, even for Next, are all relatively low. This indicates an opportunity for someone become famous in this space.
Winning the returns race
For customers, satisfaction with the returns process is not always (or only) about whether it’s free. Is making a return easy? Are there opportunities for personalisation? Is messaging clear? Are in-store returns straightforward? Are returns T&C generous and transparent? Is return tracking clear? Is sizing accurate to reduce returns?
Retailers need data on DX
But retailers can’t make these changes effectively without objective data on their Delivery Experience (DX) to guide them.
Uncrowd recently worked with a large apparel retailer who had removed physical returns cards from its packaging and moved returns admin onto an app. They expected customers to be happy with the streamlined process. But our data showed that their returns process was unclear for customers. The retailer needed to communicate better. They would not have known this without objective customer analytics.
No one in currently the clear winner for returns in the UK. Could it be you?
Uncrowd is on a mission to improve every customer experience on the planet through a unique combination of CX observation, quantitative measurement and comparative results. Our data is objective, empirical, and always shows your next best action.