Digitalisation as a solution to the increase in returns.
Ecommerce has definitively established itself in our consumption routines. With the backing of the pandemic, only a few have been left behind when it comes to buying at the click of a button. It is no longer generational, but cross-generational. However, we have seen that the rapid increase in online shopping has also had an impact on the volume of returns, which have become a real challenge for brands because of their involvement in the customer experience.
Today, reverse logistics management can only be understood from a digital perspective, as we at iF Lastmile have been insisting for a long time. It is also a way of providing a simple response to complex problems that are influenced by multiple factors. But what are these factors, the reasons why we are now talking about huge volumes of returns? Here are some of them:
- The growth of ecommerce during the pandemic. According to a study by Webloyalty, ecommerce grew by 35% in the last year of the pandemic, particularly in sectors such as electronics, travel and, of course, fashion - so much so that, according to data from KPMG, 30% of clothes bought online are returned. As we noted earlier, the confinement and subsequent restrictions, coupled with the context of household savings, allowed online sales to soar, which had as a direct consequence, among others, an increase in returns.
-Greater impulsivity when shopping. There is a very important psychological component when shopping on the Internet that has to do with impulsivity. Online shopping and the greater visibility of discounts and claims encourage us to buy unnecessary products or products that do not meet our expectations. This often leads to regret.
- Generous and open return policies. The prediction of the end of free returns, brought closer in part by the initiative of brands such as Zara, has its raison d'être in the unsustainability of its management. This is something we have already warned about in iF lastmile, as the popularisation of these return policies encourages a consumer profile that resorts to indiscriminate returns and exchanges.
- Greater visibility of the competition, greater competitiveness. The great thing about the Internet is the range of possibilities one can explore when buying a product. Sometimes it happens that, just when we have just bought something, the magic of Google's algorithms makes us find it cheaper or simply more convincing somewhere else. And then we don't hesitate to give up on the first alternative and return it, especially if it is free. Ecommerce has shown that competitors are there more than ever and that the purchase click on a product does not have to be the final one.
- Differences in perception. When you buy a product online, far from the idea of physical contact of traditional sales channels, you must rely on what the web indicates and allows you to see. For this reason, delving into the details of the articles and better information helps to reduce this gap which, on many occasions, ends in dissatisfaction for the consumer when they already have the product at home. More often than not, this lack of information can lead to an increase in returns.
- Problems with sizing. In line with the above, there are occasions in the fashion sector where sizing information can be confusing. It is therefore important to improve this type of data which, in parallel, does not encourage consumers to engage in practices such as bracketing - buying different sizes to try them on and then discarding them - which result in at least one mandatory return.
How to solve this problem? The answer is not simple and requires the involvement of both parties: consumers and brands. The former do not have to give up the advantages offered by online shopping and the magnificent shop window that opens before their eyes. On the other hand, ecommerce can and should make the most of the business opportunity that the digital medium represents, without penalising their bottom line. Is it possible? Absolutely yes. At iF Lastmile we can help you.