5 Common Reasons for Returns and How to Avoid Chargebacks

Let's talk about the exciting world of product returns and the reasons behind them. There are plenty of reasons why people hit that return button: From the wrong size or product to late delivery or defective items, all these are day-to-day common scenarios in any eCommerce business.

All kinds of returns are important and need to be dealt with. After all, there's nothing worse than an angry customer. So go ahead and discover possible new ways of handling different return reasons with our tips. Your CFO will thank you.

What are the main reasons for returns?

1. Wardrobing

Problem: Serial returners buy items with the intention of using them once or twice and then returning them. Once these items are returned, it can be seen that the item has been indeed worn and would need to be disposed of. Typically, this is a common practice in the fashion industry.

Cause: Customers find that they can save money without compromising on trends or investing in occasion wear.

Result: Retailers may need to raise prices to make up for losses due to wardrobing, as these items can’t be sold again.

Solution 1: Some retailers choose to increase the return fee, set in place strict return periods, or add special tags that need to be taken off in order to use the product to minimize wardrobing.

While these policies may inconvenience some customers, they are designed to protect the retailer and prevent the abuse of the return system.

Solution 2: Penalize only the customers that actually tried to process fraudulent returns and add them to a “return blacklist” and disable automatic returns for all the customers in the list.

2. Wrong item size

Problem: The fact that customers can’t try on the product can mean that the item comes out to be too big, too small, too long, too short, etc.

Cause: Around 25% of all footwear and apparel sales in the world take place online according to CBRE.

Result: Wrong item size is one of the most frequent reasons for returns.

Solution 1: Having a straightforward size guide available for each of your product types is the best way to ensure minimum returns due to this, but there are other ideas that can help.

Solution 2: State when the item runs big, small, wide, or has a specific cut right on the product page, so all customers can figure out in a glimpse how the product will be, without even checking the size guide (which they may never check anyways).

Solution 3: Offer a smart fitting tool so that they can visually see how it will look on them based on specific measurements, their skin color (if it’s make-up), or face features, in the case of glasses.

The following reasons for returns can be easily fixed and totally don’t depend on the customer. When the right processes are set in place, there’s almost no room for error.

3. Wrong order or product

Problem: The customer received the wrong product, the wrong color, or a size they didn’t order.?

Cause: Item verification is manual and human-dependant.

Result: The customer feels that the store isn’t professional and would demand a refund or, in the best scenario, exchange or return.

Solution 1: Implement a picking and packing process that is error-free and as automated as possible. This ensures that you send the right SKU to each customer, every time. The number of unnecessary returns that will be processed due to this will be reduced to virtually 0.

Outvio is the perfect tool for this as it speeds up the fulfillment process while it lowers its costs and keeps warehouse efficiency at its best. Sign up now to supercharge your eCommerce.

Solution 2: Assign a person the role of verifying orders manually. And face the cost of resources that this decision implies.

4. Defective item

Problem: A customer demands a return, exchange, or refund because of a fault in the item.

Cause 1: Your QC guidelines are too lax.

Cause 2: The item was produced according to the standards, but was damaged during the shipping process.

Solution for cause 1: In this case, you need to re-assess your standards and up your game in that department.?

Solution for cause 2: You need to evaluate your packaging choices and choose packaging that protects the items while impacting your profit margins as little as possible.

5. Arrived too late

Problem: The order arrived later than expected.

Cause: Too long delivery times, that weren’t maybe communicated in the first place.

Solution 1: Shorten your shipping lead times as much as possible.

Solution 2: Keep the customer informed about the status and location of their parcel and inform them upfront of the delivery time and any possible delays. This is fairly simple and automated with Outvio. Try it now.

How to avoid chargebacks

The cost of returns can be a real nightmare for retailers. There are many ways to reduce it: from optimizing the product page to automation through return rules and in-store returns.

However, there are still ways that can help you retain those unhappy customers and their profit:?

Disable automatic returns for certain return reasons

Opportunistic returners make up for a huge portion of fraudulent returns and make an impact on your profits.

The burden of tracking the return, checking items and managing them as you discard them or choose to put them back on the shelves also consumes resources from your warehouse employees.

You can easily disable automatic returns for serial returns and make them request the return so it will be manually approved (or not). This way, you can deal with opportunistic clients legally, and protect your brand.

Promote exchanges over returns

One of the easiest and simplest ways to keep the profit you made from the purchase and make the customer happy at the same time is by promoting an exchange instead of a (full) refund.

You can offer the same item in another size, color, or print (if available) or allow the buyer to explore their possibilities. You may have launched a new collection. There may be other items on their wishlist. Now could be the perfect time for them to get them.

Offer a generous bonus in in-store credit?

Offering a gift card for them to continue to spend on your store may be the win-win situation that your customers are looking for.

When they make a purchase for a value of €44, you can offer an instant “refund” of €50 in the form of a gift card or make them wait some days to receive the same amount they spent.

While it is unavoidable that some will choose the refund over the store credit, your loyal customers, those that should interest you the most, will be happy to earn some extra credit to spend in your online store.

Customizing the return and exchange process in every single way is only possible with Outvio.

Only with Outvio’s Smart Return and Exchange rules will you be able to promote exchanges over returns, offer a bonus in in-store credit, and enable and disable automatic returns and exchanges for certain products, while you automate and streamline your overall post-checkout processes.

Conclusions

Returns are just another part of doing business as a retailer. Nothing puts a damper on a customer's experience like receiving a product that isn’t what they were expecting.?

Offer hassle-free returns and exchanges and make the process as painless as possible for the customer. That’s the key to retention and customer satisfaction.

Ensure they have the best possible shopping experience with Outvio and make the reasons for returns a reason not to worry. Solve them now!