Online Retailers Not Meeting Consumers' Returns, Refund Expectations
By Anna Rose Welch, Editorial & Community Director, Advancing RNA
Consumers complain returns take too long, but in an age of retail fraud, retailers face many return policy grey areas
A recent study carried out by StellaService reveals that online retailers aren’t meeting customers’ expectations for returns and refunds. To carry out the survey, analysts from StellaService ordered the same product from each of the 25 largest online retailers and had it delivered to different regions in the East, West, and Midwest. The analysts then returned the product, recording the total amount of time it took to receive the return authorization and a refund. The average amount of time it took to receive a refund was 10.7 days, which, according to another StellaService survey, is longer than a majority of customers expect a return should take. According to the survey on customers’ return expectations, StellaService found that 69 percent of consumers expect refunds in less than 10 days. However, only 36 percent of the top 25 online retailers met these expectations.
Retailers singled out as being the speediest to refund were Shopping.HP.com and Amazon.com — both of which were found to be the quickest in a similar study carried out in 2012. Shopping.HP.com only took two days, followed closely by Amazon, which took four days to complete a refund. This is a pretty impressive feat when considering the bottom five performers, which took more than 17 days to issue a refund. Other retailers that are living up to consumers’ expectations in order behind HP and Amazon include Costco.com, Store.Apple.com, and Macys.com. HP’s success can be credited to the fact that refunds were issued as soon as the carrier scanned the package. More often than not, retailer’s returns are slowed because of long processing time as the package lands back in the warehouse.
StellaServices’ study suggests there is still work to be done to meet online consumers’ expectations as far as returns and refunds are concerned. However, as return fraud continues to grow more severe, it is important for both online and physical retailers to balance a hassle-free return policy with loss prevention measures. . The NRF predicted that return fraud from the holidays alone would cost retailers $3.4 billion. Shoppers have been growing increasingly crafty, a Businessweek article from September reports, altering receipts, switching a less expensive item for the actual item purchased, or returning an item acquired during a buy-one-get-one-free deal for full price.. To prevent customers from taking advantage of return policies, retailers have instituted policies such as requiring ID for a receipt-less return or blacklisting customers that make frequent or suspicious returns.However, as the Los Angeles Times recently reported, manyretailers remain hesitant to alter return policies out of fear of implying mistrust and alienating customers — some even going so far as to make policies even more lenient. As e-commerce continues to increase, though, there will only be more opportunity for consumers to test the limits of retailers’ return policies, the LA Times reports.
Read: The Loss Prevention Playbook
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