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Take Care of “Returns” and Customers Will Take Care of You

By Spencer Cain

Did you know that ecommerce giant Zappos discovered that customers who return the most items also spend the most money?  No wonder Zappos has an unlimited, 365-day free return policy. 

Here are more “Returns” statistics that are good for business: 

  • 92% of shoppers will buy again if a merchant offers an easy return process.
  • The Harvard Business Review found a 5% increase in customer retention can boost profits by 25% to 95%.
  • Nearly 70% of online shoppers check a store’s return policy before making a purchase.

Harvard also found acquiring a new customer is five to 25 times more expensive than keeping an existing one. See where this is going?  No business wants returns, but the statistics don’t lie. To stay competitive in the “returns game,” here are some important tips. 

Every customer wants free returns and if you can bake that into the selling price, do it. If not, you can:

  • Charge a return or restocking fee
  • Offer immediate refunds minus a return fee to reduce processing costs
  • Reduce return rates by marking sale and seasonal items as final sale

Make your return policy transparent by clearly stating:

  • What can be returned and what can’t (and why)
  • The time window for returns 
  • What condition items must be returned in 
  • How money will be refunded
  • If you have physical stores, will they accept returns? 

Here’s a great example from Nordstrom


Automate with RMA

Return merchandise authorization (RMA) software can make returns seamless allowing customers to start a return, print their pre-paid return shipping label and ship the item back to your warehouse – all without any staff.

A cool feature some systems offer is an “Instant Refund” gift card code that can be used right away to order more.

How do returns work with buy now, pay later? 

We thought you might ask! At Zip, we keep it simple. Once you notify us of a return, we immediately begin the refund process. 

Customers concerned about making payments on returns can contact us. We will then pause payments for two weeks to give you time to process the return and notify us. In either scenario, customers receive a full refund from Zip once the return is completely processed.


About the author
Spencer Cain

Spencer Cain is a fashion and entertainment editor with a background in ecommerce and trend forecasting. His work has appeared in numerous publications including Us Weekly and StyleCaster, and he spent six years leading US content for ASOS. He believes that online shopping should be an Olympic sport.