Holiday Returns: A Trend On The Rise

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Across the country, millions of customers are exhaling a sigh of relief knowing that the holiday season is over and all the shopping and prepping that comes with it. However, one more yearly tradition awaits them as they stare at this year’s piles of returns and exchanges to be made. In fact, UPS estimates that it will handle more than one million return packages on January 2 — or “National Returns Day” — alone, a 26% increase from last year.

Returns are on the rise — 86% of consumers have returned holiday gifts, and more than half of consumers expect to return more this year than in years past. This trend is heavily influenced by returns policies, with two out of three shoppers saying they considered a brand’s return policy when purchasing holiday gifts.

Here are some key points that can help businesses better understand this increase in returns, and perhaps be better equipped to refine their policies to better serve their customers.

What is being returned?

Many studies showed no category is immune from returns, but clothing was unsurprisingly the most frequently returned item, followed by shoes, electronics, accessories, and toys.

Among the least frequently returned items? Furniture and exercise equipment!

When is it being returned?

Turns out shoppers are eager to clear their space of unwanted items. 67% of U.S. consumers say they make holiday gift returns within one week of the holiday, with 6% saying they handle returns the day after the holiday.

But despite most consumers acting fast, they still expect brands to give them plenty of time to decide if they’ll be keeping an item, with shoppers saying they expect brands to provide an average returns window of 32 days.

How is it being returned?

While e-commerce is on the rise, 77% of consumers say they still prefer to handle returns in stores vs by mail. That preference is likely driven by the desire for more instant gratification, as 71% of consumers cited that when making a return, their preferred outcome is a cash or credit refund, while 22% say they prefer to exchange the product for something else they like more.

Why is it being returned?

Consumers make returns for a myriad of reasons, with “fit issues” being one of the most common on the list. Other reasons include, 27% of consumers say they’ve received a defective item, 22% say they received duplicates of the same gift, and nearly 10% say they have returned gifts in an effort to minimize clutter.

Equally as interesting is why consumers don’t return gifts that they’ve received. With 52% say returning the item wasn’t worth the hassle, 37% say they didn’t have the receipt, and 15% say they didn’t want to pay for return shipping

Topping the list of reasons, however, is gift-keeping guilt. 79% of Americans say they have kept an item because they felt too guilty about returning it.

Brands should pay attention to their return policies –

One thing is clear — returns can make or break when it comes to winning and keeping customers.

In fact, 62% of consumers say they’ve decided not to purchase something because of a brand’s return policy — and 95% agree that a bad returns experience would make them less likely to purchase from a brand again in the future.

But for brands who get it right, returns can also be key for up-sell opportunities and driving long-term loyalty. According to studies, 46% of consumers have exchanged a gift for something more expensive, with men being 16% more likely to do so. 49% of consumers have also become a repeat customer of a brand after first learning about it when returning an item. When asked what drives repeat purchases following a return, shoppers cited fast and easy process (84%), free returns (67%) and having the return label included in the box (46%).

Shipping success isn’t a one-way street. From policy to process to price, returns directly impact’s shopper purchase decisions, satisfaction, and long-term loyalty

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