Happy Returns

• Making it easy for customers to return items at no cost started as a retail strategy to entice more people to shop online.
• So how can retailers fix this problem and still provide quality customer service?
• We conduct research in reverse logistics, focusing primarily on the intersection of retail returns and customer behavior.

Nudging: In-store vs. shipped returns

• Items returned to the store can be restocked an average of 12 to 16 days faster than those that are mailed.
• Mailed returns also cost companies more: The difference between the most expensive shipped returns and least expensive in-store returns is $5 to $6 per item.
• In a recent survey, 94% of merchants said customers were concerned about sustainability, according to a report from Happy Returns, a logistics firm that works with retailers.
• Nudges like this offer a simple and inexpensive way for retailers to alter customer behavior in favor of sustainability.

Picking up returns to speed up the process

• It’s known as customer procrastination, and it also has a cost.
• High-priced electronics, such as laptops and tablets, have short product life cycles and lose value quickly, sometimes at a rate of 1% per week.
• A home pickup service for time-sensitive returns could reduce delays in a way that is also useful to the customer.

How to change policies without losing customers

• We conducted two studies to explore how customers would view changes to a retailer’s return policies.
• When the return policy change targeted customers who abused returns, 44% of the participants expressed positive emotions, and only 13% expressed negative emotions.
• Nearly half indicated they would speak negatively about the policy change to family and friends, and 42% said they would shop at another store.

Other ways to help customers make better decisions

• One way is to obtain detailed customer feedback on returns and use that to provide better product descriptions to customers.
• Well-intentioned free shipping on orders over a set dollar amount could encourage customers to overpurchase and later return products.
• Virtual fitting rooms that use an avatar of the customer to try on clothes virtually can help customers choose the right size the first time.