How your eCommerce return policy can help induce sales
Returns are one of the biggest challenges faced by an e-commerce store. If you have a liberal return policy, your customers can take undue advantage of it. If the policy is too strict, it could scare off potential customers.Â
Many eCommerce store owners handle returns on a case-to-case basis. Some of them do not mention the very name of returns on the website, for fear of customers taking undue advantage or scaring them off.
It can be quite difficult to balance customer expectations and the nature of returns; but once you do it right and stick to your rules, it can actually help increase goodwill and eventually, sales. Â
To understand this better, you need to know how a customer perceives value and what drives them to make a purchase. Once you have identified their purchasing behavior, you can make a return policy that works for you as well as your customers.
How a customer perceives valueÂ
Customers see value in a product based on their perceptions of value. If they feel the item is valuable to them, they’ll buy it. The perceived value of an item is unique to each customer.
Price sensitivity- The price of the item does matter, but not all customers buy looking at the price. Those that do are not loyal to any brand. As an eCommerce business, you have to price the product strategically, giving a perceived value to the product and brand that can affect returns. For example, if a new customer buys a T-shirt from you, you could allow returns for barter so that the customer knows that he can get something he likes from you.
Coolness factor- Customers buy products to look ‘cool’. For instance, teenagers may buy branded jeans just to emulate their peers, though cheaper jeans could do the job.
Uniqueness- The rarer the item, the more the customer would want to buy it. This is how luxury items are so sought after. Some people pay more just to get the rare item. Brands like Supreme, Air Jordan, and others use this strategy to convince customers to buy them.
Fulfills a ‘want’- Customers invest in products that they want. This could mean the latest trendy Air Jordans, aviator sunglasses, and much more. They value the product according to their wants, not their needs.
Ease of use- Customers want easy-to-use products. This could include products that solve any of the challenges they face in their daily lives.
Trust- Customers loyal to a brand trust it completely. They are willing to pay more for a product even if there are cheaper options available.
Hits an emotional trigger- Some people buy things to feel good. They buy things to gift their loved ones or when they realize it could help them.
Make a return policy that induces trust
A potential customer would always find something to induce trust before he makes the payment. He would see the product’s USP, understand the product’s dynamics and finally, understand the company’s return policy.
As you are an unknown entity, the customer would like to know what’s in for him if he doesn’t like the product. Customers trust Amazon for a reason- they know how easy it is to return products to Amazon.
Your return policy should give the customer a reason to trust you. Many eCommerce websites and mobile apps have a no-questions-asked return policy- they deal with the returned product on a case-to-case basis.
You could say- ‘We deliver what we promise’, or ‘100% satisfaction guaranteed’, as a tagline. However, make sure you put in rider and conditions so that you can’t be taken for a ride.
How can you increase sales with a return policy?
Returns are an expense that you have to bear, just like you spend for marketing, sales, website maintenance, and so on. If you aim to increase sales while keeping returns to a minimum, you can add the cost of returns to the product’s price. For instance, a shirt costing $50 could be sold at $52, the slight price increase wouldn’t make a big difference, but you could at least cover some of the return expenses from it, right?
Remember, investing in returns can eventually help you increase brand awareness and goodwill. If you refuse a genuine return request, the customer could bad-mouth you through reviews, which could cause irreplaceable harm to your brand.
On the flip side, if you have refused to accept a return for genuine reasons as stated in your return policy, you could give it back to the customer who speaks ill of you online.
Creating a sound, well thought return policy could help you instill trust in your customers. With this, they have another reason to make a purchase. If the customer is wrong, do not hesitate to give it back to them. After all, you cannot allow your customers to take you for a ride.
