Product returns are one of the most significant pain points that ecommerce business owners face today. It causes a financial burden because returning products involves—picking items from the customer doorstep, performing quality checks, and refurbishing to make items sellable again—all these elements mean an extra cost for your business.

According to studies, 57% of online retailers say that returns have a negative impact on the day-to-day functioning of their business.

As per the 2020 review by IMRG, experts believe that almost one-third of margins are lost in returns and that almost 33% of online retailers had to increase their product prices to counter this financial loss.

You can reduce the financial impact of returns on your business by looking for certain red flags. By identifying these, you can ensure that you're taking every possible measure to minimise product returns.

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Why it is important to work on lowering product returns now more than ever

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The increasing number of returns has been the reason for major dips in profits for online retail businesses. Studies show that 30% of online products are returned compared to 8.89% for a brick and mortar business.

A survey by Zebra which included Indian online retailers reveals that 93% of respondents said that product return remains a key problem. This shows that product returns are affecting every ecommerce business today.

Curbing product returns not only increases your profitability, but it brings a positive impact on your ecommerce business.

Lowering product returns means robust brand reputation, increased customer loyalty, and becoming one of the top ecommerce brands in your niche.

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7 Red flags to look for to minimise your product returns

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1. You upload generic products without any personalisation

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According to SaleCycle, the 2nd most common reason for product returns is that the product “does not match descriptions.” Haven’t we all been victims of this?

Always upload clear, high-quality product images instead of generic product images that do not match the actual product.

The last thing you want is to frustrate your customers because they did not get the product that they ordered because of improper images.

Add as many images as possible to describe your product from different angles. You can upload a 360-degree photograph or a detailed video that demonstrates your product.

For example, if you take a look at Blackberrys online store, you’d see that they have added relevant product images from all possible angles, along with a precise description that sets the right expectations with the customer right from the start.

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2. Your exchange policy is hard to find on the store

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Not having an easily accessible and clear exchange policy may be a predominant reason for increased product returns.

When buyers understand how easy it is to exchange your products when compared to returning them, they can make confident buying decisions.

An exchange policy assures buyers to explore other products if they don’t like the one they have bought. It helps you instil trust and build customer loyalty.

Make sure your exchange policy is easily accessible from each product page. Do not bury it somewhere on your website and make it difficult to find. Not making an exchange policy easily accessible on your website may result in customers making hasty purchases, which eventually lead to increased product returns.

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3. You don’t have a live chat support

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Design your website to give maximum clarity of the products to your visitors. While having FAQ pages may seem to suffice, having live chat support will help get all their specific questions answered.

Chat support is quick. It’s like a 24x7 sales representative at a departmental store. Live chat is always there to assist any website visitor irrespective of their time and location.

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Whether your ecommerce business is relatively new or an established one, you should always have live chat support.

Visitors may want to know more about products, payments, returns, and replacements. According to Intercom, 82% of chatters are more likely to become your customers.

Having chat support will help them know everything quickly and easily, and your business will gain the credibility of being transparent and available in real-time.

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4. You don't test your website after changing the layout or adding new products

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Another common mistake that online retailers make is that they don’t test their website. This can lead to bad customer experiences and incorrect transactions, leading to increased product returns.

Often, you may change your online store’s theme, change the layout, or add new categories and products to your website. Even if you’re using a high-quality ecommerce content management system (CMS), it is good to have one round of testing every time you make changes to the website to make sure that everything is working fine.

Without testing, you might not pay heed to some errors.

If you're running an ecommerce business, make sure your website is mobile-friendly. Check all the fields, buttons and procedures to verify the alignment of your website.

For example, when customers want to exchange a product for a different size, they may not be able to do so or the exchange link might throw an error. In such a case, the frustrated customers will probably opt for returning the product.

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5. You’re not leveraging all the social media channels

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When you use social media channels effectively, you optimise the overall customer experience. This is why social media channels are a great tool that can help you reduce return rates.

Social media channels work as proof of your business. So, make sure your customers find carefully curated social media profiles that accurately represent your brand identity.

You can let customers know about your brand story, products, and promotions.

Over time, you’ll notice better engagement, an increment in the number of referrals, better brand reputation, and more sales. When customers’ affinity towards your brand increases, product returns will automatically come down.

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6. You don't send post-purchase emails

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Sending a post-purchase email to your customers can be an effective method to reduce returns. You need to use the opportunity between order placement and delivery to educate customers about their purchase, reduce objections that lead to returns and keep customers excited for their order.

Here's what Val Geisler from Fix My Churn has to say about post-purchase emails:

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It’s your job as a brand to ensure that customers are excited about the product long after they hit purchase. Send educational emails and engage your customers so they never regret their purchase. Get them excited for delivery, don’t let them sit and wonder if they made a good decision or not

-Val Geisler, Fix my Churn

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Regardless of the category of products you sell, sending post-purchase emails to inform customers is a significant part of providing an exceptional customer experience. This helps customers stay informed about your products and ultimately reduce product returns.

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7. You haven't implemented a dynamic size chart

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Providing your customers with an accurate and detailed size chart is another effective way to reduce customer returns — especially in the fashion and apparel industry where the average return rates are as high as 40%.

For example, ASOS, a UK based fashion retailer has taken a great approach to help customers pick the right size. They have created a detailed size guide for each product category. In addition to this, you have the option to provide ASOS with your height, weight, body type, and personal fit preferences. After which ASOS uses an algorithm to determine the perfect fit for you. This is a great way to make the shopping experience more user-focussed and reduce returns.

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Bottom line

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Product returns are an inevitable part of any ecommerce business. It is best to tackle the problem of increased product returns by identifying the flaws in the process before it gets too late.

By identifying the red flags provided in this article, you’ll be able to reduce the number of product returns and increase the number of sales. So, start working on these strategies right away to enjoy more customer satisfaction and fewer product returns.

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