Return Policy Blogs Strategy

Why a Good eCommerce Return Policy is More Important Than Ever

Return policy is a pain for merchants but a reason of smile for buyers. Is there any way to strike a balance? Read to know more.

We already know that as much as 80% of the global population with access to the internet shops online. Those numbers are growing every day as the internet reaches more people across the world. Needless to say, e-commerce is already a trillion dollar business and is more than likely to keep on growing with each year. Back in 2014 when it was already a $220 billion dollar industry in the United States alone, Americommerce projected that it’d hit $370 billion by just 2017.

E-commerce already accounts for more than 8% of all retail sales in the United States. So what is the secret behind e-commerce’s phenomenal growth? What drives people all over the world to change over from their usual brick-and-mortar stores and begin moving to online web stores and marketplaces? The short answer is convenience. With the average workweek for a large section of the population ranging between 47 and 50 hours, online shopping offers the perfect solution to cover an emergent need – the convenience of being able to shop for anything from anywhere and have it delivered to your doorstep.

The convenience of online shopping is not limited to simple logistics, big discounts, and time-saving One of the major attractions online shopping offers is the buyers’ ability to return a purchase if he or she is not satisfied with any aspect of the product. In fact, a strong return policy is actually more important than low prices when it comes to marketplaces and online shopping.

Why is a strong return policy important?

Simply put, a strong return policy is one of the many conveniences that can decide the success of an online marketplace. The success of some product categories entirely depends on how effective the return policy is, a very apt example being fashion and apparels. Granify ran an analysis on some 20.8 million online shoppers to quantify what shoppers would consider as the top 3 objections by category. Here is the ranked rundown.


Apparel Digital Goods Jewelry and Accessories Health Home Building Supplies
Most Important Return Policy Price Return Policy Price Return Policy
  Social Proof Urgency Price Education Shipping Cost
Least Important Price Return Policy Financing Support Support

So it’s pretty apparent from the data above that customers put in as much consideration into a marketplace’s return policy as the competitiveness of the prices they offer. In fact, a strong return policy has a slight edge over low prices given the fact that they are the top point of consideration across 3 categories out of 5. Simply put, 60% favor a strong return policy over low prices.

There is even more evidence to support the hypothesis that return policies are very important when it comes to selling more. A positive merchandise return experience is essential for retaining customers and building loyalty, with as many as 92% consumers agreeing that they are more likely to shop at a store again if they offer a hassle-free return policy. A neat 80% of customers also pledge their allegiance to marketplaces which offer easy return policies.

Convenience of Return

The success formula is not limited to how wide the time window for returning a product is or what kind of exclusion policies are in place. The convenience of returning a purchase is more about how much time and effort it’ll take on the consumer’s part to initiate and see the process through. When it comes to making a return, as little as 42% shoppers are satisfied with the return process and a complicated return process is likely to deter 80% shoppers. The top 3 gripes customers usually have with the return process are:

  • Inconvenience – 40%
  • Associated Expenses – 40%
  • Confusion – 6%

Therefore, it makes sense to cover for these three crucial elements. Customers are more likely to have an overall better shopping experience at you marketplace with these things in place. With almost 1 in every 3 purchases being returned by customers, it becomes necessary to make a return process which is relatively hassle-free and inexpensive.

50% of shoppers think that returns can be easier to make online. According to a ComScore survey, the most important things customers want out of the return process includes:

  • 52% want the return shipping label included in the box
  • 86% want a return shipping label provided by the retailer
  • 79% customers want free return shipping offered at the time of purchase
  • Only 12% are looking for quicker refunds or direct store credit against returns

Building a Better Return Management Plan

It’s pretty evident that by and large, customers want to jump through fewer hoops and have an easier time returning their purchases if they wish to. Some might argue that an easy going, no questions asked return policy might put a dent in a marketplace’s ability to remain profitable. However, numbers would beg to differ and if you take long-term profitability into account, the ability to retain customer loyalty through an easy return policy can boost your sales by as much as 375%.

  • Make Your Return Policy a Simple Read – As many as 66% customers read return policies before deciding on a purchase. On top of that, 6% customers also find the process of initiating and completing a return confusing. Therefore, clarity is paramount when you frame and word your return policy. Make sure it’s easy to read, lay out the rules systematically and highlight the exception clauses to increase their readability.
  • Flaunt It – A staggering 40% of customers reported having a hard time finding the return policy page itself. A confused visitor is an unlikely buyer so it’d be a pretty good idea to put links to your return policy page where it’s easily visible and accessible. To make your return policy even more useful, you can possibly include How-To videos or infographics to better describe your return process.
  • Streamline the Process – The essential idea behind a streamlined return process is that customers should need to do very little to complete the process successfully. Since 86% customers want retailers to provide the return label and 52% want the return label already in the box itself, it should be a good place to start.
  • Free Returns – Much like how free shipping can persuade customers to buy more and frequently, no cost returns are just as important for sales. 68% shoppers prefer stores and marketplaces which offer free returns. The fact that a staggering 90% want free returns to be a general offering in online stores should be enough evidence to persuade you to implement it if you haven’t already.
  • Re-engage – Even if a customer returns a product, it’s still a closed lead. Since you already have some idea about your customer’s needs and wants at this point, you can use that data to build customized offers and recommendations to draw the person in again. Re-engagement just is another opportunity even if a customer is not satisfied and returns a product.

How important is return policy for your business? What’s your strategy to include return policy in your multi-vendor store? Share your views with us.


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