Lessons from Amazon’s Returns Loophole

A contractual loophole reportedly allows Amazon customers to get their money back for items they have bought from the website without having to return their purchases.[1] This recent revelation applies to items under – £10 but what does it say about retail industry attitudes to returns in general? Above all, this move highlights Amazon’s financial ability to write off returns. However, small independent online retailers may not be in the same position to implement such a policy. Ultimately, for most retailers ignoring returns can lead to heavy repercussions. Research by Harris Interactive shows that 85% of customers say that they will stop buying from a retailer if the returns process is a hassle. Therefore it is essential that retailers get the returns process right in order to deliver a strong customer experience – so what are the key steps to returns success?

Retailers are often carefully attentive to the speed and accuracy of outbound delivery because of its obvious link to sales. But the same kind of focus on the returns process is often found lacking. In order to implement an effective, customer friendly returns process, retailers must accept that returns are an inevitable aspect of the customer purchase cycle and plan ahead accordingly.

The first step is to make their returns policy clear to customers from the outset and carefully ensure that they are compliant with the regulations, which differ across countries. Customers should be able to navigate the whole procedure simply and swiftly, and systems should be thoroughly tested before being rolled out to the market. By its very nature, online shopping requires a high level of trust between the consumer and the vendor, with money usually exchanged before goods are received and the consumer lacking the opportunity to try on or examine the product before making their purchases. There will inevitably be times when the product doesn’t fulfil the customer’s expectations and is sent back – and a good returns process can go a long way towards minimising the frustrations associated with this, potentially turning new customers into repeat customers.

It’s also important that retailers offer flexibility when it comes to returns. It’s no longer sufficient to offer a sole, standard returns service.   In order to appeal to as diverse a customer base as possible, offering other options such as trackable returns should be considered. In a recent study by computer hardware company MICROS, 53% of retailers surveyed offered a choice of methods for returning an unwanted item bought online. These choices included return by post and returning to a retailer’s store.

One option for providing an effective returns solution is outsourcing the process. This allows companies to focus more energy on producing a good online shopping experience for their customers. For small retailers especially, this may be an attractive option. There are real benefits to be derived for retailers partnering with an expert third party to manage the returns solution. For example, the best providers are able to tailor the solution to fit the retailer, customising it to deal with national and regional differences where necessary and advising on the best   shipping and returns options for the volume of mail being processed. This third-party expertise is particularly useful for any retailer looking to sell internationally, as it will help retailers navigate any potentially tricky import and duty.

The expert provider should also facilitate the integration of the returns process with existing IT systems and logistics providers to ensure minimal disruption and cost. Ideally, the returns process should be integrated into the website on a white label basis, so that as far as the customer is concerned, everything looks and feels the same.

Amazon’s returns loophole has brought the returns theme into sharper focus. For most retailers failure to implement a comprehensive returns process comes with consequences, playing as they do a vital role in maintaining customer satisfaction levels. There are many considerations to take into account. These not only include current requirements, but also how the business might grow, and whether the returns process has the flexibility to handle that growth. This may include consideration of overseas expansion and how the company will manage cross-border returns and the ensuing complications. Expert providers can develop an efficient and effortless returns system for retails which help rather than hinder the customer experience.

Paul Galpin. Managing Director, P2P Mailing.

[1] Independent, “Amazon loophole allows customers to get refund without returning item”, http://www.independent.co.uk/news/business/news/amazon-loophole-customer-refund-without-returning-item-money-back-policy-a7736336.html, 15 May 2017

Leave a Reply

Your email address will not be published. Required fields are marked *