Use Post-Holiday Returns to Refine your Store Policy for the New Year
The holidays can lead to a higher than usual number of returns for retailers. But instead of dwelling on how returns cut into your profits, use the opportunity to build positive customer experiences and sharpen your return policy. It will pay dividends in the New Year.
Store returns are a fact of life. The National Retail Foundation (NRF) cites that nearly two-thirds of consumers returned at least one item during last year’s holiday season. Although these returns cost you money -- especially when customers pay with credit cards and you are stuck with the merchant processing fee – it’s a worthwhile expense that keeps shoppers returning.
After all, customer service doesn’t stop with the sale. Making it easy for customers to return purchases to your store makes them more comfortable with buying items in the first place. The NRF found that three out of four shoppers checked return policies before making a purchase and said it was important to their buying decisions. It also found that 64 percent of customers were less likely to shop with a retailer again after a negative return experience.
So it’s important that your return policy and process create positive experiences to generate loyalty and positive word-of-mouth. Here are some tips:
Put your return policy front and center for all to see. Make sure it clearly states terms and conditions of a sale. This transparency builds trust with shoppers.
Set clear limits in your return policy regarding the length of time consumers have to return items. It reduces misunderstandings and confusion.
You don’t always have to provide a full refund. Having exceptions is fine, as long as they are published. For example, selling heavily discounted merchandise under a “no return” policy, or only allowing customers to exchange significantly marked down items for store credit. Also, consider whether a restocking fee is warranted.
Offer refund choices to customers. For example, reordering a returned piece of clothing in a different size, or offering store credit or a gift card that can be used later to purchase something from you.
Gift cards alleviate the post-holiday returns blues.
Gift cards are a great return option. Customers like them and they keep the money in your store. A Blackhawk 2018 Consumer Gift Card Preference survey found:
63% of consumers are interested in receiving a gift card in exchange for a returned item
42% of consumers use gift cards they receive right away
59% of consumers often spend more than the amount on the gift card
To incentivize customers to opt for gift cards, some merchants deduct a fee for cash refunds, while offering gift card refunds for free.
Good training = good return experiences
Get your staff in the habit of referencing your return policy when finalizing a sale. For instance, stating how long shoppers have to return an item (etc. 30 days). Have them explain the exceptions to your return policy. Also mention other requirements, such as bringing the sales receipt. This will set customer expectations and reduce the number of returns you deal with.
Additionally, ensure your employees are well-trained on handling returns. There’s nothing more frustrating to customers than being told that only certain staff members can process returns – and those people are off or on break. And be sure your employees know to offer exchanges, store credit and gift cards to keep transactions in-store.
Lastly, a well-trained staff and integrated POS tools can speed up the resale of returned merchandise by tagging and tracking it in real time as available inventory.
Your return policy shouldn’t be etched in stone. Think of it as a work in progress. Use post-holiday return feedback and experiences to fine-tune your store’s policy. By improving your customers’ end-to-end service experience, you will also be cultivating shopper loyalty that keeps them coming back year-round.
Heartland offers you best in class solutions to easily manage payments, point of sale systems integrated with inventory management, and customer engagement solutions to provide your customers with gifts and rewards. Contact us today to learn more about how we can help you.