Product returns, a challenge to be taken to build customer loyalty

According to the results of a survey published by GXO in August 2021, 42% of consumers say they have already returned an item of clothing online. A trend that has not escaped the attention of retailers, who are increasingly taking the logistics of returns very seriously. Still according to the same survey, More than a third of retailers say online returns have increased in the past 12 months. Even 72% of professionals invested in returns management processes, which include after-sales service procedures, recycling, repair or refurbishment activities. “Over the past three years, consumer habits have changed. Customers usually buy many products and send them back. Since March 2020, this influx of revenue has exploded after online sales doubled,” Explains Vincent Torres, CEO of Revers.io, a company founded in 2009 that specializes in e-commerce returns issues. For consumers to be completely satisfied, they also want to be reimbursed quickly, three to five days max. Lots of restrictions that retailers have to put up with. In fact, receiving, verifying, storing, and storing returns before resale requires many manipulations and packaging for operators who travel long distances. “Return management represents a fairly high cost, at least €10 per item”, Pierre-Yves Minaro, Deputy General Manager at Scallog, specializes in robotic solutions for distribution logistics. Therefore, reducing costs and logistical challenges of the current wave of e-commerce has become a priority for brands.

Amazon was one of the first players to offer 30-day returns and “try before you buy” on its clothing. This forces its competitors to align themselves with the same level of service, to provide consumers with the possibility to order as many items, try them on, and pay for only the clothes they want to keep. “This has become a staple for retail players. To build customer loyalty, you need to manage product returns quickly and simply and provide them with transparency,” Vincent Torres confirms.

Give customers a choice

How do you do this and how to best optimize your return logistics? To fully satisfy consumers, they must first be given the option to return and, above all, not force it. “Some want to pay for home collection, some for return at the store, or a post office deposit,” Vincent Torres advised. Then you have to Offer the most intuitive solutions possible to increase consumer engagement and improve their overall experience. According to a report on the state of retail mobility published by Soti in 2021, two-thirds (64%) of French consumers say they would buy more if goods were easy to return. Customers increasingly want to return their package online or in-store, get information over the phone or on a front, download their return voucher to the phone or computer, track their return by email or SMS alert… All in an easy and understandable way. “The customer wants everything just a click away, to do everything on their own. They want to be in control of their returns, refunds, and to be notified with the same regularity about their returns file processing as when they buy them, a bit like Amazon offers,” Revers.io founder notes. Once the product has been deposited, the return system lets you know that the product has been collected and that a refund will be given. “This is how the repeat purchase rate is going to increase. We need technology that tracks and triggers actions automatically,” Vincent Torres adds.

Act as quickly as possible

For e-merchants, technology will above all allow for faster execution and manufacturing of operations. “The increase in the volume of e-commerce sales has generated a large volume of revenue that must be made, says Vincent Ricci, France Director of Development at GXO, the leading provider of contract logistics for professional players. We currently record between 15 and 25% of revenue for our e-commerce customers like Sarenza. » To meet the expectations of its customers, particularly a major fashion electronic retailer, the group has deployed an automated bulk quantity management solution in reverse logistics that integrates several technologies, including a state-of-the-art automated sorting system, to manage flows of up to 12 million product returns annually. Eight automatic sorting lines for clothes and one line for shoes are combined with contactless scanning technology. Scanners’ cameras use machine vision to read color codes rather than barcodes, speeding the movement of products labeled on conveyors according to their condition: ready for inspection, damaged or for sale.

Optimize restocking operations

Regarding returns to physical stock, which requires travel and therefore time on the part of operators, one of the approaches that will be implemented is the creation of designated areas for returned products. The French company Scallog, which has equipped many of the Decathlon sites, has developed a system of robots and multi-reference shelves. The latter, which provides several locations of different sizes in order to store a ski van, a T-shirt or a pair of socks, is placed by robots in front of the operator in order to be able to replenish the stock or to make a selection to prepare orders. “This principle makes it possible to prioritize shipping return products during a new order, bring in items very quickly and sell them very quickly because inventory costs money,” explains Scallog’s general manager.

If the yield of the products is sold, the environmental impact can be significant.

Because revenue is also synonymous with pollution: the proliferation of boxes, plastic bags, and other packaging, not to mention the carbon footprint associated with moving freight. “Retailers can differentiate themselves by making the packaging suitable for both receiving and dispatch. Packages made of cardboard rather than plastic should be easily opened by pre-cutting so that they can be returned with a return label,” In front of Pierre-Yves Minaro. So having an eco-friendly returns program will become an important factor when making an online purchase.

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