Tips for Converting Your Holiday Returns Into Sales

Shortly after the last cup of eggnog is finished, shoppers will start returning unwanted sweaters, toys and other gifts. While the post-holiday return rush can be a headache, ecommerce brands have an opportunity to use this time of year to generate long-term loyalty and drive additional sales.

Most retailers experience an influx of returns after Christmas and into early January. In fact, shoppers returned 10% of items purchased during the 2015 holiday season, according to the National Retail Federation.

Although return rates vary based on the type of products sold and other variables, retailers that fail to streamline their processes for handling returns risk alienating shoppers and missing out on future sales.

Transform Returns Into Sales and Loyalty

With the right strategy, ecommerce brands can convert returned merchandise into sales opportunities. Whether it’s a new customer experiencing the brand for the first time or a frequent customer looking to exchange her purchase for a different item, a positive return experience increases the likelihood she will make repeat purchases from your brand.

On the other hand, a negative experience can send customers straight to the competition – and often to social media to share their frustrations with friends and family.

Here are a few useful tips to help your ecommerce brand turn a traditionally stressful time of year into an opportunity to drive loyalty and first-quarter sales:

Set expectations on your website: Never mislead customers. Make sure your return policy is clearly stated on your website and printed on receipts that arrive with packages. Shoppers should know exactly how long will it take for returns to be processed during the holiday rush, and how many days after the purchase they have to make a return.

Communicate frequently and often: Constant communication with customers helps convert returns into sales. For example, if a shopper returns a sweater, find out why she is unsatisfied with it and use that information to inform future communications. If she says the sweater is too small or the wrong color, provide her with options. If she doesn’t want a sweater at all, offer her promotions for jeans or accessories.

Plan ahead: Use information you already have about sales volumes and return rates. If you know your brand’s holiday sales totals and typical holiday return rate, you can reasonably estimate how many returns to expect during the post-holiday rush. To process returns quickly and maintain an exceptional customer experience, consider hiring seasonal workers or making additional room in the warehouse to store and process returned items.

Deal With Returned Items Quickly and Efficiently

Processing returns is only half the battle. After receiving returned items, you need to either place them back into available inventory or move them out of the warehouse. Either way you need a plan because the faster returned items find their way back on the shelves, the faster you can sell them again.

Smart retailers have a strategy in place to efficiently differentiate items that can be resold from those that cannot be sold again, or holiday-themed items that need to be discounted. Items that must be removed from inventory should be given to charity or recycled to save room in warehouses for products that will generate actual revenue.

Make sure your team understands the return process and customers are aware of your policies. To help the process go even smoother many ecommerce brands work with third-party logistics providers that are experts in managing warehouses and processing inventory.

Want more information about how to turn holiday returns into loyalty and sales? Check out Dotcom Distribution’s tip sheet, “Three Steps to Creating a Bulletproof Return Policy.”

Maria Haggerty is CEO of Dotcom Distribution

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