Even with as much as 30% of ecommerce purchases resulting in returns, many businesses do not know how to construct an efficient and customer-friendly returns policy. Most companies see returns as a cost center and focus most of their time, energy, and money on preventing them rather than optimizing them. But, while returns are not the most glamorous department, a clear and deliberate policy surrounding them can improve almost every aspect of your business.
When making a return policy from scratch, it can be difficult to figure out where to start. That’s why we’ve compiled a template of staple areas that every return policy should include. This template will provide you with the basics, but it’s important to remember that there is no one-size-fits-all return policy. A good return policy tailors to the specific needs of your business, your customers, and the types of processed returns. That said, it’s important to include certain features in any return policy aimed at optimizing the customer experience and workflow efficiency.
How to Format a Return Policy
Before discussing what to include in a return policy, it is important to know how to format it. A return policy is no place to be vague; your return policy should be clear-cut and simple. The customer relationship is already at risk when a return is made. A deliberately confusing policy can completely sever ties between your business and the customer in this tenuous time. Thus, your policy should be as consumer-centric and user-friendly as possible.
A policy should contain straightforward, easy-to-read language on its own separate page that is easy to access from your ecommerce homepage. The webpage should prominently display a company logo to assure the customer that your business stands by this policy. The policy should begin with the most necessary details and descend to less immediate and more specific information.
Start by explaining your return window to let the customer know immediately if they can return their purchase. For customers who have products longer than the return window allows, including this feature at the front of your policy page will save them time. Customers with products that fall within the window will feel assured in proceeding.
Next, explain how the complete return process works. In this section, include how to package the item, what to include in the packaging, where and how to ship the item, and how long the customer should expect to wait until your company fully processes their return.
Once you inform the customer of how the return process works, you can discuss payment. There are multiple options for dealing with return shipping costs, which we will discuss later. Whatever option you chose, make sure the description is as straightforward as possible.
Finally, explain any exceptions to the previously stated rules. Perhaps some exchanges come with free shipping, while other types of returns do not. Maybe a certain promo is ineligible for returns. You should clearly outline specifics like these after the information listed above is covered.
How to Create Return Windows
Most return policies must prescribe a start and end date between which a customer can return a product. This period is called a return window, and without one, you could expose your company to a multitude of return issues. Items returned past a certain time after the original sale are more likely to be damaged or worn from use. Most likely, these items are rendered ineligible for resale. Including the time frame to submit a return in your policy will provide clear guidelines for processing returns.
You have a few options when constructing your return window. The first is deciding when your return window should start. Return windows generally start either at the point of sale or the point of delivery. The more liberal the return window, the more your consumers feel comfortable buying your products. Consumers would rather see a return window begin at the point of delivery – especially in today’s atmosphere where shipping delays can create an issue.
Next is deciding the length of your return window. Generally, ecommerce retailers have return windows between 30-60 days. Just as previously stated, a great return policy is all about pleasing the customer. You should factor in this line of thinking when constructing your return window. Recent studies have shown that – while counterintuitive – increasing your returns can boost sales and decrease returns in the long run. A flexible return policy encourages purchases from first-time buyers and increases customer loyalty. Customer loyalty directly improves your customer lifetime value which leads to more profit and less return risk of returns in the long run.
(Want to learn more about customer lifetime value (CLV)? Here is our free CLV calculator!)