Maximizing Profits by Diminishing Returns Online
Your initial sales figures look fantastic! The Black Friday and Cyber Monday campaigns have exceeded all expectations! But now the dreaded returns are starting to come in...
What's the issue?
Recent figures from LCP Consulting indicate that as many as five million parcels bought on Black Friday in the UK will be returned. It is estimated that returns cost online retailers £20bn per year.
To state the obvious - returns are certainly not good for the retailer. It isn’t just the lost sale but the not inconsiderable costs linked with overseeing the process. In fact, The Financial Times reported earlier this year that the average product return passes through seven pairs of hands before going back on resale.
Is there a solution?
There are the obvious steps that most retailers adhere to, such as giving a clear description of the product, making sure the photography shows the product in detail (from multiple angles), gives clear sizing information and that the colours are as good a match as possible (something which isn’t always easy). Getting the order shipped as quickly as possible can also have an impact. Then there is the use of Social Proof.
Social Proof is an increasingly popular means by which a visitor to the site or mobile app is presented with up-to-date information, such as how many other people have looked at a particular item in a certain time frame, what other products appealed to them and what they went on to ultimately purchase. It is a great sales tool that creates a sense of urgency, especially during a sale or when an item is limited in stock. Download our free Social Proof eBook to find out more
Including elements of Social Proof on the website and mobile app is a compelling approach to increase sales and reduce returns, but do not forget to incorporate such information in Cart and Browse Abandonment Emails. Automatically populating these triggered messages with Social Proof can help to give an undecided customer the incentive they need to complete their purchase.
With the right technology, these changes are easy to implement and manage but it can make a huge difference to the volume of returns. Of course, it is unlikely that you will ever eliminate returns altogether but giving customers more information at the time of the purchasing decision helps them to select and keep the products that are right for them. This helps the shopper get it right, protecting customer satisfaction and hence your margins and revenues, turning one-off customers into repeat customers.
Want to find out more?