The Risks of Sending Customers Product Return Labels
UPS says including a product return label with every order is a great way to streamline the returns process for retailers and their customers.
They couldn’t be more wrong. Unless you’re a subscription retailer sending out orders based upon preferences, this is actually one of the worst and slowest ways for eCommerce retailers to manage their product returns process.
Returns are a huge part of UPS’ business. So they are eager to help eCommerce retailers succeed. Putting a return label – a UPS label, of course – in the outbound shipment seems on its surface to be a great shortcut for the customer that would make returns feel more seamless. But UPS is a shipping provider, not a retailer, so they don’t know that this approach provides no visibility into the volume of returns or what causes them in the first place.
A big problem with this approach is that most retailers don’t have a process in place to collect any type of returns data when the product is received back in their warehouse or fulfillment center. If they do collect returns data, it’s usually done manually via spreadsheets which means it takes even longer to get this data in the hands of the people who need it.
Optimizing your returns process is the only viable way to address surging returns volume, and to do that, retailers need more data about returns and they need that data as soon as possible. With a clever strategy, returns can still be easy for the customer while generating the essential data retailers need.
Consumer Attitudes About Returns
UPS has done some valuable research on consumers’ attitudes about returns. For the five years they have been studying online shopping, returns have been one of the lowest areas of online shopping satisfaction, ripe for improvement. Shoppers surveyed for their 2016 Pulse of the Online Shopper report said these elements are part of a best returns experience:
60% free shipping
51% a hassle-free policy
42% timely refunds
44% easy-to-print return labels
40% return label in the box
In blog posts on UPS.com and RetailDive, UPS advocates return-label-in-a-box as the best way to answer consumers’ call for an easy experience.
"Some shippers provide the ability to print a return label on their website, to save a step in the shipping process," says Jim Brill, UPS reverse logistics marketing manager, in UPS’ blog. "It's an automated approach that saves time in the shipping department and enables better data collection about return merchandise, but one that requires the consumer to take a couple more steps, and may affect the customer experience."
But it’s clear that consumers don’t care that much – slightly more (44%) actually want a label that’s easy to print than one in a box. It doesn’t make a big difference to them, but it’s a very big difference for retailers.
When the return label is included with every order delivery, the retailer:
Has no idea when or if the return is coming so the returns receiving department cannot staff properly
Can’t enforce returns policies without, in many cases, damaging the customer relationship
Receives little to no data on WHY the item is coming back – or gets it so late, it’s of little use to prevent future returns
A Better Approach to Product Returns
Instead, retailers need to automate their returns origination processes. By providing a self-service returns authorization portal, the consumer gets the easy returns process they are looking for and one that allows them to:
Identify the items in their order they are returning
Select from some A/B tested, product-specific reason codes for their return
Easily generate a return label
Choose a shipping method
Send the package off to quickly get a refund
Now the customer has an easy, seamless returns experience, while the retailer is collecting valuable data about why the product is coming back and when so they can staff appropriately. And by applying analytics to this data, they can gain all sorts of insights that help them correct problems, learn what customers want and prevent future returns, up to 10X faster than they could by putting a return label in every box. That’s big impact to the bottom line.
UPS agrees that understanding reasons for a return is a key step in the returns process. In fact, it’s step 3 in the six steps to an effective return they recommend in this infographic: “Save the sale: Understand your customer’s reason for a return so you can prevent it or generate a new sale.” But retailers can never do that without collecting returns data BEFORE it’s returned.
Putting return labels in the box is a practice retailers need to abandon as soon as possible if they are truly customer centric. Instead, retailers should consider a self-service solution that can streamline and automate the entire returns process, collecting critical information about their products and customer behaviors.