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By Marcy Bonebright, dealnews Senior Staff Writer
Despite all its advantages for customers, online shopping can sometimes be a logistical nightmare — for the merchant. Getting the right items to the right customers in a timely manner with zero mistakes is asking an awful lot from e-commerce. Therefore, you'd expect online-only vendors (i.e., those without brick-and-mortar shops) to have some of the highest merchandise return rates in the industry. But you'd be wrong.
According to Internet Retailer, in a poll of 500 companies, online-only merchants had significantly lower merchandise return rates than other retailers. In fact, web-only merchants reported an average return rate of 3.75%, as opposed to the 4.96% average for all 500 companies.
This returns statistic matters for online retailers because a merchant's return rate "can indicate problems in website content, customer service, or fulfillment operations." Moreover, "a high merchandise return rate might suggest that product descriptions on the merchant's e-commerce site are not accurate or complete, that call center agents aren't adequately responding to consumer questions, or that warehouse personnel are too often shipping the incorrect product or size."
The article further suggests that a product itself can have a significant impact on return rates. For example, the highest merchandise return rates were reported by clothing and shoe companies. After all, even excellent shipping practices, customer service, and web design can't turn a size 2 into a size 10. In a supplemental interview, founder and former CEO of Shoebuy, Scott Savitz pointed out several other factors that can affect a site's merchandise return rate, such as low-quality items and lengthy shipping times.
But we wonder if there isn't another side to this story. Certainly, if an online-only merchant goes above and beyond to provide excellent products shipped in a timely manner, then we'll be less likely to return them. However, returning an item bought online can often involve eating expensive shipping fees, lengthy phone conversations or email exchanges with customer service, and other hassles.
So is the lower rate of merchandise returns for online retailers a case of correlation instead of causation? Are you less likely to buy something online if you might have to return it? Or perhaps customers just hang on to the "wrong" item purchased online, rather than deal with the returns process? Sound off in the comments below.