A day after Christmas, UPS affirmed and updated its expectation that it would process just shy of 2 million returns on Jan. 2, 2020, representing a seventh consecutive record-breaking National Returns Day.
At stake for retailers as ecommerce continues to reshape the holiday shopping experience is brand loyalty and repeat sales. The latest UPS Pulse of the Online Shopper study says 73% of shoppers link their likelihood to make purchases again from specific retailers based on their returns experience.
“For retailers, a seamless returns process is essential to keeping and growing business,” said Kevin Warren, chief marketing officer for UPS.
The record 1.9 million packages UPS predicts processing on National Returns Day represents a 26% increase from 2019. Returns via UPS involve more than 36,000 drop boxes for smaller packages with labels, pickup by UPS drivers, drop-off at UPS store, and at UPS Access Point locations, including Michaels, Advance Auto, CVS Pharmacy.
FedEx is similarly positioned, accepting returns at Walgreens, Dollar General, Kroger and Albertson’s, as well as its own stores. This holiday season, Amazon extended its returns partnership with Kohl’s to all of its retail locations, as well as partnering with Stein Mart on returns.
UPS said December returns were expected to average 1 million packages per day, with 1.6 million packages returned Dec. 16, in a trend representing purchases from early holiday season shopping.
Approximately 10% of U.S. purchases are returned retailers each year, amounting to lost sales of $369 billion, CNBC reported in citing a 2018 report from Appriss Retail and the National Retail Federation.
Greg Buzek, founder and president of research and advisory firm IHL Group, told CNBC that apparel is a leading category for returns, with some types of apparel returned at a rate approaching 50%.
In reaction to the UPS data on National Returns Day, post-purchase payments company Returnly released new holiday data on New Year’s Eve saying Dec. 26 is actually the biggest day for direct-to-customer (DTC) brands.
“The moment of truth for returns is Dec. 26, when shoppers start returns online,” said Eduardo Vilar, founder and CEO of Returnly. “This is when brands have the opportunity to get the right item in a shopper’s hands before they even drop off their unwanted packages in early January. Brands planning their return strategy around January 2 have missed the mark to connect with customers in their moment of need.”
According to a Returnly study:
- Dec. 26 shows the largest amount of online returns started by shoppers in a single day, twice as many as historically on Jan. 2.
- The majority of shoppers (56%) use a mobile device to start their returns online. However, when returning orders of $300 or more, shoppers take extra steps to make sure they’ll get refunded by brands, with 72% using desktop computers instead. This suggests that modern shoppers are wary of the mobile returns experience offered by brands when returning high-priced items.
- “Where is my refund?” is the number one customer support contact request after starting a return. Merchants don’t want to take any risks and need to make sure returned items are resellable before issuing refunds, ultimately making customers wait. Slow refunds and lack of visibility over refund status make the returns journey particularly stressful for customers that just want their money back.
Returnly’s take on holiday returns is based on return behavioral data of a random sample of 4 million online consumers 18 and older across apparel, accessories, footwear, jewelry, beauty and electronics. Seasonal trends are based on data from shoppers that made and returned at least one online purchase in the last 24 months.