Top-10-Reasons-For-Refund-And-Exchange

The order was a little late… Received the wrong thing… it’s not up to the expectations… Whatever the reasons for product return, online rates of return increased dramatically.

Whenever a return has been triggered, you must focus on two factors- Rendering and the Experience. Yes, as easy as these both processes would be hand-in-hand it prohibits such scenarios from recurring more and more.

The rising amount of refund and exchange cases in eCommerce is turning into a constant source of distress for the retailers. It is forcing them to find out the reasons for the eCommerce product return, refunds and resolve them to the maximum possible extent.

Refund and Exchange are crucial in every type of business, not just limited to the Retail but in Online stores also.

About 30% of online products are returned, on average, while the graph rises during the festive season as compared to 8.89% of products in retail stores.

Consumers’ digital preferences have developed and standards have evolved as a consequence of the rising shift to online platforms in the last year.

customer-experience

Customization, User Experiences, and Online Trust are being evaluated more now than ever, and individuals who have originally purchased in brick-and-mortar shops demand the very same experiences online too.

If your store does not facilitate the buyers with the return feature, then you would start to lose that one-fifth of their prospective buyers right away. Gradually with time, the majority of them will jump to your competitors.

REMEMBER, LOSING A SINGLE SALE IS LESS DAMAGING THAN LOSING A REGULAR CUSTOMER.

That’s not just an end to this, store owners are also aware of the fact and are ready to fight up with that. Many businesses are evolving by employing more staff, upgrading storage spaces, and creating separate sections to manage their reverse logistics efficiently and smartly.

Returns have become the norm today, and they are at the core of the customer experiences. They do not even have to be a nuisance, either.

Needed A Fully-Fledged Reverse Logistics Manager For Your Store?

The very first step in restructuring your return and exchange policy i.e. reverse logistics that works best for your business is understanding the reasons for eCommerce product return and exchange and their initiations.

Understanding The Underlying Cause Of The Refund Request Will Lead You To More Effective Remedies.

You must also note that the amount of refund requests you receive varies with the type of product you are selling. For example, clothing and apparels sold online have a higher return rate while entertainment products have a lower return rate.

The below-listed stat from Statista depicts the list of products and their return expectancy, check it out-

product-return-stats

It’s critical to comprehend why buyers return items, as there are generally the same reasons for refunds. Benevolent fraudster refunds can occur when a consumer is unhappy with their transaction, and avoiding that discontent prevents both returns and fraudulent charges.

Understanding the factors for your consumers’ unhappiness might help you determine what is really causing your refund concerns and with which you can improve customer loyalty as well as other procedures of your business.

Although, it’s impossible to know what’s on each customer’s mind. Overall, there could be various reasons for the eCommerce product return, refund, and exchange requests by the consumers at an individual level, but we have selected the top 10 popular reasons for refunds in this article.

Note: It is not customary that the returning product is always bad or damaged to be rejected from the inventory, rather can be anything. 

Let’s dig that deeper and understand the reasons for returns and refunds one-by-one in detail-

1. Bad Customer Support

Customers are demanding responses in quick time. 82% of clients view the immediate response as very crucial when they have concerns, according to HubSpot’s research. It clearly defines that the routes you deploy should have suitable responsiveness.

This is an area where experts can assist you. Your salespeople should demonstrate why a customer should retain a product and what it could do for him.

This clearly tells us that- [Product] information is your ultimate power, as cliché as it may be. However, you’d be shocked how much information may help your team and business operate better.

Allow your staff to learn the ‘ins and outs’ of a product. This allows them to better engage clients and communicate any benefits of the product and maintain their curiosity piqued.

For effective customer assistance, the support staff must have the necessary competence and decorum to utilize impactful statements. It lessens the unfavorable impact of customer service and aids in the creation of amazing success stories.

bad-customer-experience

Smart Tip-

High-value customers are also the most likely to utilize the returns process. Make sure the experience leaves them feeling good about your brand.

It’s evident that it’s time to automate your returns when the user experience team spends significant amounts of time manually making shipping labels and addressing inquiries like Where is my reimbursement? rather than assisting customers in finding the correct item to buy.

2. The Product Isn’t as Convincing as the Buyer Thought

It is not at all necessary that your product would always bring happiness to your customers, even after they have bought it. Purchasing is just a deal, and your customers aren’t interested in deals that do not fulfill their expectations.

When a buyer orders something, he begins setting up his own expectations. If someone ordered a pair of sneakers, they begin dreaming of how they would go on a morning walk in those sneakers.

product-up-to-the-mark

If someone orders a shirt, they start visualizing the occasion when they would be wearing it. In the same way, several expectations are being set already before the product actually appears at the doorstep of the customers.

But Those Expectations Are Not Always Met When The Product Is Received In Real Life.

Consider the example of Richard who was planning to purchase headphones to listen to and enjoy his favorite songs. He checked the description of the best possible headphone in his budget and ordered them expecting high sound quality and other acoustic features.

But, after the product arrived, its sound quality wasn’t as convincing as Richard had assumed. Although the product specifications were the same as mentioned in the description of the product page, yet Richard personally doesn’t find it pleasing. So, he chooses to return it and get refunded.

Smart Tip-

Offering accurate information about your goods upfront will help reduce refunds. Consumers are less likely to return merchandise if what they receive meets their expectations. Make absolutely sure your site’s product pages are detailed and include elevated, accurate images.

3. The Product Description on Website Conveyed Wrong Information

Online shopping is different from shopping in physical stores; in a way that the buyers can physically handle the products in the latter while this is not possible in the former.

Online shopping is more dependent on product descriptions and the visuals, images, or videos present on the product page. Although high-quality images, zoom view,  and detailed description is of great convenience for shoppers in deciding the product to purchase, it’s not always as convincing as that in a physical store.

product-view

Such a high-resolution image and a detailed description could compensate for some of the drawbacks of not being able to touch the product physically.

But,

Any disagreement of the actual product from the description would become the reasons for refund and exchange later after it’s in the hand of consumers. Buyers are completely innocent in such cases and their refund or exchange request are completely justified.

Such instances impact brand reputation negatively. A number of such cases outroot the overall trust of the buyers from the brand, likewise the example listed below from Bored Panda

product-not-as-described

Who would like to keep such products? Returning is the only option!

Smart Tip-

Have a quick analysis of- Does your buyer expect a higher level of quality as a result of the marketing or because of the price?

Or did my product quality suffer as a result of product lifecycle scrutinies likewise manufacturing changes in the middle of the season or missing QA to achieve the deadlines? That somehow reduces the chances of getting into the product return process and management.

4. “Poor Fit” Is the Most Common Reason for Making a Return

Product size is a critical factor and a major reason for returns and refunds in the fashion, footwear, and clothing category.

The wrong size of a boot pair and unfit clothes are of ZERO use to consumers and hence returning them becomes the priority. If they don’t, their money will be wasted.

Sometimes, the wrong merchandise gets packed and delivered to the consumers, which could be the mistake of merchants or the packing staff.

sizing-issues

For both these reasons, return, refund, and exchange are necessary to avoid churn and to keep up the trust for the brand in consumers.

Offer sizing charts that are all clear include almost all sizing patterns available where you serve clients. Even though, if you feel a consumer is worried or confused about the sizing, it is better to introduce sizing by demonstrating videos or guides along.

Smart Tip-

Overwhelmingly, shoppers said that having access to user-generated content including Reviews, Q&A, Images and Videos would have made them less likely to return a product.

In fact, across the board, two-thirds of shoppers agreed that they would be less likely to return a product if they had been able to read or view this type of content prior to purchasing.

5. Making a Subtle Purchase via Wardrobing

Buying something to use with the intention of returning it, such as buying a dress for a party, hiding the tag, and returning the worn product later for a refund. The Instagram era has also given birth to “Digital Wardrobing” where people purchase clothing to wear for social media and then return.

Consider a Case:

There was a lady from North Carolina, who had bought a bright red dress from a well-known brand. It was all good and sober until the lady again approached the site for the product return process, with a sweet reason for the crime; ‘The dress did not fit me.’ But, when the product was re-checked by the merchant, it was seen that the hem of the inner-lining was a bit loose and seemed that it had been scissored purposefully.

I can understand the ouch feeling of that brand that has suffered this nuisance in the name of refunds and exchanges.

These are innovative yet unfair reasons for product return and exchange requests. It is a pure sense of fraud in purchasing items. These are the situations when customers are likely to indulge only for their selfish instinct and unknowingly hampers the workability of a successful business.

wardrobing

Some interview candidates purchase a tie or blazer for their job interview and return it after using it. Soccer fans purchase a big display TV for the World Cup final and return it the day after the match is over. There are not just these one or two ways, people are filled with a high volume of such creative and clever ideas for wardrobing.

Readers buy novels, read them in a day, and then return them for ridiculous excuses in order to get their money back for the next book.

Such reasons for return and refund are not genuine. They are pure exploitation of the return and refund policy, which is deteriorating your business model.

Now,

How can a merchant know if any of their buyers are indulged in such activities? What can they do from their end to reduce the cases of wardrobing? 

The customer purchase and return history, their behavior, their mentioned reason in the refund request form, etc., must be thoroughly analyzed to draw out the pattern and conclusion and identify the legitimate return request from the wardrobing cases.

In addition, include acceptable products in the return policy, aim to reimburse in the shop wallet rather than the customer’s credit or debit card, and leverage exchange rather than a refund.

Smart Tip-

Shoppers are using their homes as fitting rooms, resulting in returns becoming more common. Better is that smartly accept returns that are with valid reasons or introduce strict security checks for returning of luxury goods in order to avoid such mishappenings.

6.  Buyer’s Changed Opinion Or Need

The buyer’s opinion and choices do fluctuate even at the last moment.

There are situations when a customer’s illogical purchasing behavior triggers the product return process. Furthermore, some eCommerce retailers provide free shipping on returns as well. Because they aren’t going to buy entirely, many buyers will take advantage of such offers and acquire more than they expected.

When buyers change their minds or when the requirements of any product are no more, they decide to return the product that was recently received to save their money.

Why do buyers no longer need that product? 

There can be multiple reasons for that.

If a person orders a book and subsequently discovers that his buddy already has it and is willing to lend it to him, the person may choose to return it and receive a refund.

7. Fraudulent Returns

On the internet, being a badass is much easier than in real life. Returns that are fraudulent account for 6% of all returns. There’s a good chance that a consumer is currently attempting to defraud you.

return-fraud-retailer-experience-stats

The Following Are the Most Typical Types of Return Fraud Character Traits-

  • Swappers place orders for a new model to substitute one that is defective or outdated.
  • Friendly con artists claim customers neither bought the product nor never obtained their goods.
  • Fraudsters buy things using imaginary money or seized credit or debit cards and then return it for a reimbursement, which they usually expect in cash.

It’s quite difficult to avoid cases of fraudulent refunds. The eventual aim is to catch quite so many fraudsters as possible in order to make their returns unpleasant. If you notice some unbalance in your activities, follow the appropriate steps-

  • Take notice of serial numbers and other distinguishing markings to ensure that the returning item came from your shop. This makes it more difficult for swappers to substitute your goods with outdated ones.
  • Snap photographs of the packing to confirm the item was in good condition. That’s only appropriate for small businesses with low overall sales.
  • Consumers on the phone– The more personable you appear to the client, the more difficult it will be for anyone to deceive. Hearing your voice may persuade a consumer to reconsider scamming your business.
  • Demand a paper and a signature– A statement can safeguard you if someone says they never received their order. If a consumer claims they never placed a purchase, keep the order information on hand.
  • Credit card refunds are preferable to cash refunds because they protect you from purposeful theft.
  • Reduce the return term to 30 days, return items in their original packing and state, teach your personnel to identify used items, and maintain consistency in your rules.

Smart Tip-

Keep in mind that dishonest clients might be very vocal. It could also be a red flag if you refuse to accept the return (without breaching your refund policy, of course) and the consumer becomes irrationally upset.

The best part is that once merchants start collecting fraudulent daily returns, their capacity to reduce future return fraud skyrockets, especially in omnichannel retail when purchases are made online and refunded in-store.

8. Festive Season: The Time of Highest Return

Festive seasons have the highest sales throughout the year.

Check out the stat by Inc42 for the 2021 Festive Sale till date, it surely depicts business and sale-

festive-sale-stats

With such high Sales, the Return and Refund rates are also at a peak.

People purchase a number of gifts for their family and friends. However, not all gifts are loved back by the receiver; some gifts do not meet the needs of the receivers; so, the best alternative is to return and get a refund or swap it for other similar products.

Store owners cannot cut down their return policy straightforwardly as it would hurt them more. In fact, many retailers modify their festive return policy; providing free return shipping on festive sales to attract more buyers during the festive time.

But, the practice of buying gifts with the intention of returning is turning into a new normal for the shoppers. Retailers are seriously concerned about it, actively looking for solutions to reduce the unwanted return of the festive gifts.

Smart Tip-

Leveraging Gift Cards is a good option to reduce the chances of a return request and is the best solution to -How to handle customer returns in festivities?

Gift cards are provided as a credit amount, and the recipients spend it on items of their choice, color, and size. Thus, making it less probable to mismatch and hence avoiding the situation of return and refund.

Need A Virtual Gifting Solution For Your Customers??

For some people, gifting products physically means more. Therefore, providing them with curated gift ideas can be another good technique to avoid the poor choice of gifts.

9. Late Deliveries & Improper Order Tracking

Delayed delivery is one of the really unsatisfactory things that can happen when you place an order. No matter, how infrequent it is.

In an ideal world, packages might arrive on time with little to no hassles or interruptions. However, goods may arrive with damage, flaws, or erroneous qualities in some cases.

track-orders

Shipping delays and receiving damaged things are common occurrences. These problems enrage clients, who are eager to learn why they occur and when they will receive their package or reimbursement.

Smart Tip-

Transparency and tracking capabilities are critical in the product return process; retailers should keep shoppers informed of return package status and refund status; This might allay buyer fears that their delivery will be lost or that the returns process will be a “black hole.”

Checkout This Outstanding Shipment Tracking Solution For Your Store?

10. Unorganized Refund Policies & Solutions

Creating an effective return and exchange plan for your online marketplace is crucial for customer happiness. If you don’t, you’ll have a bunch of angry customers, low revenue, and bad morale.

Initially, the terrible news: approximately 30% of shoppers deliberately over-purchase and return unwanted items. Some e-commerce firms are considering making the return process onerous for customers in order to eliminate returns.

return-policy

“Why make it easier to return goods?” they could ask. “I’d rather not deal about returns!”

This is where the great news comes in- 92% people polled claimed that if the return process is simple, they will purchase again.

A Few Examples in This Respect Are-

Brummell Co.

Brummell’s return policy for its premium socks simplifies the process into five easy steps.

reasons for refund and exchange

They inform customers about the specific requirements for a return, as well as the expected processing time.

BAKblade

This example is a little different than their return policy, BAKblade automates the return process for customers.

reasons for refund and exchange

Through the portal shown, customers can easily start the return process from BAKblade’s website.

Automation and effective management are all crucial aspects that led to the foundation of a smart system.

Yes, heard that right.

It is now time to replace your outdated management systems with some of the most recent and intelligent alternatives on the market.

RMA Return, Refund & Exchange for WooCommerce Pro from WP Swings is such a revolutionizing product that turns down the critical return and refunds management to an easy child-like task that too with no major coding knowledge involved.

One Plugin With Complete RMA Solution

Get The One-stop Complete Solution For Return, Refund, Cancel An Order, Exchange, Wallet, And Other Services Related With RMA Management; All In This Plugin.

You only need to sync one within your WooCommerce store to manage returns, refunds, and exchanges. All your headaches and troublesome nights are going to end soon.

So, to keep customers coming back, it’s important to allow returns and that requires a strong online returns management system. Such a system that caters to all return processings and helps you understand well the reasons for product return.

Summing Up

Examining the reasons for refund and exchange can help you figure out how to deal with them. They taught us how to deal with the problems that arise as a result of frequent return and refund requests.

Return requests aren’t usually the result of customer error. Sometimes that is the retailer’s responsibility, and other sometimes it’s just an odd condition that can’t be overlooked.

If the reasons for refund and exchange listed above are thoroughly understood and strategically handled. Then they can surely help you with your quest i.e. How to handle customer returns? Along with, you can also learn decreasing excessive costs associated with returning products and reselling inventory.

Further than the BUY NOW button, an efficient product return process to help the most renowned brands and retailers develop lifelong relationships. It increases brand loyalty at scale by allowing customers to have rich and emotive post-purchase experiences.

RETURNS ARE THE NEW NORM TODAY; EVERYONE HAS A DIFFERENT RATIONALE FOR DOING SO, AND THUS THEIR ANSWER LINE DIFFERS TOO THOUGH.

I hope this article is helpful. Let us know, What are the strangest, craziest, or most problematic reasons for refund and exchange you’ve ever seen in your online store?

I’d love to hear your thoughts in the comments section, and please do share.

About the Author: Bhagyashree A Awasthi

A dev-turned-writer, Bhagyashree. She has been this way because of her passion for reading and blogging. She has always been an avid reader of; books, narratives, etc. Her urge to explore new things is what fuel her enthusiasm. Reading, being outside, and traveling are her favorite free time activities. Rather than just a mere profession, she views content creation as an emotion.

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2 Comments

  1. KATH OBLEA June 10, 2021 at 12:46 pm - Reply

    Hi sir, somehow your article state facts. But at some point ecommerce business is somehow in demand in our time today. All of the person in different side of the worlds are doing online business. At some point problems and difficulties arises that was definitely true. Thanks for sharing your thoughts it with be a great reminder to all.

    • Satya June 11, 2021 at 4:18 am - Reply

      Thanks Kath, for liking and sharing your opinion with us.

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