Returns: a powerful lever of differentiation and loyalty for e-commerce

By Antoine Carteyron, Managing Director France, Stuart

At the heart of the e-commerce promise lies the simplicity and immediacy of a purchase made in a few clicks. You can select an item of your choice from the comfort of your sofa and have it delivered to you within a matter of hours. However, once you’ve received your parcel, you are presented with two possible scenarios. First case: your purchase matches your expectations and you are satisfied with the experience. In this case your customer journey ends here and your consumer needs have been satisfied. In the second case, things are not quite as simple. Your purchase does not live up to expectations and you must return it. The complication? You are now the only agent responsible for the return: you need to find the nearest Post Office or corner shop, and deal with opening times that are incompatible with your schedule. Suddenly, all the comforts of e-commerce vanish, and you are left with the pain of the returns process.

The returns phenomenon is particularly prevalent in the e-commerce world, with one third of all purchases being returned — especially in the fashion sector. The offering around returns has become the third most important factor for consumers when purchasing goods, after speed and price of delivery, meaning that e-merchants must innovate quickly in order to offer a return experience which can match consumer expectations.

Convenient and easy returns, the next battleground of e-commerce?

With this in mind, pure players such as Zalando are innovating rapidly. Jonathan Trepo, Managing Director France of Zalando, mentioned the partnership with Stuart at VivaTech 2018, explaining: “If a customer wants to return 3 t-shirts, they go on Zalando.com, access a returns calendar, where they then pick a 15-minute slot, for example next Sunday between 16:00 and 16:15. As soon as the courier is en route, the customer is informed via notification. 89% of customers consider this returns process simple and easy, which is the best satisfaction rate ever registered by us.”

E-commerce players need to realise that online buyers that might have at one point only been interested in availability of a product and its price, are now much more experienced and demanding. At a time when 67% of e-shoppers consult the product return offering before finalising an online purchase, staying competitive in today’s digital environment depends of the retailers’ ability to offer a cohesive end-to-end and on-demand experience, meeting and anticipating customer expectations.

Towards a simple, transparent and seamless return process

Although fashion is already experiencing one of the highest online penetration rates, let’s not forget the most prominent disadvantage of e-commerce on physical trade: the inability to try on a garment before buying it. Undoubtedly one of the levers to retain and attract new customers is to minimise this disadvantage, by making the return as painless as possible. As such, some initiatives, such as the “Try & Buy” model — an offer to transpose the fitting room in the customer’s home, with a satisfied or refunded commercial policy — have come into being.

These new services, that prioritise flexibility and convenience for the end-customer, are in line with the expectations of millennials, who are the leading consumer group in this market. In order to win them over, retailers must make this kind of service a standard offering at check out in order to retain and attract clients of this kind.

As you can see, no one should ignore the fact that returns have become an essential component of e-commerce. Also, in order to remain relevant, online sellers must invest in comprehensive return strategies that restore consumer decision-making power among different return methods, such as point-to-point filing or courier collection.

This is how Stuart helps e-commerce players solve this challenge via a turnkey web app that offers all end-customers a simplified return experience, express or by appointment. In two clicks, the customer can select their 15-minute parcel collection slot, 7 days a week, from 9am to 8pm.

Management of e-commerce returns: a long-term loyalty tool

The acquisition of new customers does not represent a sufficiently durable strategy to be able to ensure the profitability of an activity. Loyalty plays a far more important role. It is in fact loyalty and the re-engagement rates of customers that are a key indicator of performance, which should be followed and stimulated by the implementation of ad hoc initiatives. And when we know that a consumer’s loyalty costs 5 to 10 times less than acquiring a new client, priorities should be clear.

Delivery, in and of itself, has become a determining factor in purchasing and re-engagement. Some e-merchants have understood this well by offering an unlimited delivery offering for end-customers, with the ultimate aim of creating a reflex purchase. Where some people will see a cost, investing in logistics and banking on a range of more flexible and more personalised associated services, can prove to be a winner in the medium-long term. Let’s not forget that 87% of buyers say they are ready to buy again from an online merchant, following a positive delivery experience; whilst 38% of consumers will choose a different retailer following a negative delivery experience — which means that delivery plays a crucial role in customer acquisition and loyalty.

One thing is certain: winning market share and customer loyalty cannot be done without a perfectly executed delivery and returns experience. In an on-demand economy, the ability to offer a fast, flexible and reliable delivery promise and a seamless returns experience will undoubtedly be one of the hallmarks of the relevance and competitiveness of a retailer. It is an effective way to win the favour of consumers who expect this level of service. In order to compete with physical retailers offering evermore services (personal shopping, concierge services, etc…) e-merchants must find innovative ways to meet the challenge of proximity. And again, one of the levers for developing this new range of services will have to be powered by agile, last mile logistics.

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