10 Useful Tips for a Great Returns Policy

Having a good return policy is essential for every webshop. It provides clarity for the customer and can help boost sales. We’ll explain how to approach this with 10 practical tips.

In short, what is the ultimate return policy?

Many webshop owners don't pay enough attention to setting up a solid return policy. Usually, they look up a few examples from competitors, tweak them slightly, and put them online. Unfortunately, that’s too simplistic. A return policy offers great opportunities, and it’s a shame not to make the most of them.

In short, the ultimate return policy is:

• Clearly visible
• Easy to understand
• Inspires confidence
• Encourages the customer to make a purchase
  

Finally, it’s best to offer free return shipping so the customer doesn't have to cover the cost themselves. Furthermore, a good return policy should always include at least the following essential components.

Essential components of a good return policy

We can identify a number of essential components for setting up a good return policy for your webshop. Make sure all of these are included in your policy.

1) Return period

Clearly state how long customers have to return a product. This lets your customers know exactly where they stand. Also, keep the legal cooling-off period in mind. By law, for example, online purchases in the Netherlands are subject to a mandatory 14-day cooling-off period.

2) Return costs

In your return policy , also clearly state the shipping costs for any returned items and who is responsible for them: your webshop or the customer. These types of Return conditions are an important part of a good return policy.

3) Customer effort

How much effort does the customer have to put into returning purchased products? The more concerns you can alleviate in advance, the better. By clearly stating what you as an online store are responsible for and what the customer needs to look out for, you also avoid potential problems later in the return process.

4) Return options

It is important for customers to know how a purchase can be returned. For example, you can offer various return options, such as shipping via a carrier like DHL or DPD. You can also allow customers to drop off their purchase at a collection point themselves.

5) Getting a refund

How long does it take for the refund to be processed? Is it initiated when the shipping receipt is received by the online store? Or only when the product is back in the store's possession? Make sure this information is included in your return policy.

Why have a good return policy?

First of all, 67% of online consumers check a return policy before making a purchase. Is it a long, confusing story? Or does the policy seem untrustworthy? In many cases, the purchase will not go through.

Secondly, the return policy is a great place to put your brand values into practice. Do you stand for sustainability, the very best customer service, or products of the highest quality? Make sure this is reflected in your policy.

Finally, a good return policy keeps the customer satisfied and prevents unpleasant situations. The clearer the rules, the smaller the chance of misunderstandings and time-consuming customer service interactions.

Examples of a good return policy for webshops

It is advisable to write your return policy as simply and clearly as possible. This ensures that you keep the return experience pleasant for the customer.

If you write a confusing and complex return policy, you can assume the customer will have a poor experience. It is a good idea to browse the FAQs and return pages of several successful e-commerce websites to get some inspiration.

Example 1: Jewelry brand My Jewellery

As an example of how it should be done, we have included the return policy of jewelry brand My Jewellery below:

Here, you can see aspects such as return costs, return options, and the return address at a glance. All this without the information becoming too complex or overwhelming.

Example 2: Fashion brand Loavies

The return policy of online fashion brand Loavies is also clearly written and simply presented in 4 manageable steps:

1. Register
2. Pack 
3. Ship
4. Refund

This keeps it easy for the customer to see exactly what is expected of them regarding returns.

Furthermore, the Loavies return policy clearly shows what the shipping options and return possibilities are:

Tools to optimize your return policy

There are various tools you can use to optimize your return policy and return process. It naturally depends on your specific webshop and business model, but the tools below can often make a big difference:

Native return processing on your e-commerce platform

Depending on which e-commerce platform you use, you will have the option to manage several aspects of return processing within the platform itself.

For example, an e-commerce platform like Shopify offers the ability to manage your own return shipments. In your dashboard, you can, for instance, view the track & trace status of your returns and send updates and confirmations to your customers.

Apart from these native tools provided by your e-commerce platform , there are also specific return platforms you can utilize. These generally focus on providing the most customer-friendly user experience.

A dedicated return platform like Returnista

Return platforms go a step further, offering webshops and e-commerce managers the opportunity to get the most out of their return process. These platforms often integrate with a large number of local and international carriers and provide customers with an easy way to handle their returns.

You can also use a return platform like that of Returnista proactively send status updates on returned products. This reduces the pressure on your customer service team by up to 40%, as you receive fewer chats and calls.

Furthermore, Returnista offers the option for customers to exchange products for another item immediately while submitting a return. This helps you retain customers who might otherwise have shopped elsewhere.

More on this revenue retention strategy below; first, let's go through some tips for a solid return policy.

10 tips for a solid return policy

Looking to improve your return policy? Consider these 10 tips:

1) Warranty

When a potential customer considers making a purchase, they undoubtedly have questions about product quality. A great way to remove this doubt is by offering a warranty or repair service for any issues.

An attractive warranty policy increases trust among (potential) customers, which in turn boosts sales. Research by Assurant Solutions showed that an extensive warranty doubles the likelihood of customers recommending a company or product.

Finally, a good return policy keeps customers satisfied and prevents unpleasant situations. The clearer the rules, the lower the chance of misunderstandings and time-consuming customer service interactions.

2) Enable exchanges

An important goal of a good return policy is to reduce the number of final returns (and thus refunds). The more customers keep their products or immediately order a replacement, the more revenue a webshop ultimately retains.

Effective ways to lower the number of final returns include promoting exchanges and offering store credit. When a customer can order a replacement product directly during the return process, you prevent losing that customer and having to refund the purchase amount. This turns the return process into a sales opportunity.

3) Sustainability

More than half of consumers take sustainability into account when making a purchase. This naturally applies not only to the production process, materials, and shipping, but also to the returns policy.

A company known for a sustainable returns policy is Patagonia. This brand offers free repairs for damaged products and sells Worn Wear. This allows them to project quality and sustainability while limiting product waste.

Working with sustainable carriers also makes a returns policy more sustainable. For example, opt for last-mile delivery via a bike courier or a carrier that uses central pickup or drop-off points. Returnista, for instance, partners with the sustainable carrier Homerr. By mentioning such partnerships in your returns policy, you show that your brand stands for sustainability.

4) Social responsibility

In addition to sustainability, consumers also value a brand's social responsibility. The Edelman Trust Barometer 2020 showed that 63% of consumers in 2020 decided whether or not to become a customer of a company based on their social stances.

A great way to integrate social responsibility into your returns policy is by handling returned products correctly. Are they discarded, resold, or donated?

Unfortunately, a large portion of returned products still ends up in the trash. While this is often unavoidable for damaged items, if a product is still usable, consider donating it to a local charity or donation center.

By handling returned products effectively, you provide a positive customer experience while also preventing waste.

5) The best service

Put the customer first. The more attractive your return policy, the easier it is for the customer to make a purchase.

For example, offer a longer return window and free returns to keep the barrier to "trying out" a product as low as possible.

Research from the Journal of Marketing showed that customers make 58% to 357% more purchases in the two years following their first free return. Unfortunately, this is not the most sustainable policy.

6) Flexibility‍

77% of consumers today expect multiple return options. Fortunately, with the right return software , it is easy to provide this flexibility. This allows the customer to choose their own carrier, pickup time, and drop-off location.

By offering flexibility in your return policy, you remove the burden of time and effort for the customer when making a return.

7) Reward loyal customers

Motivate customers to research the product they want to buy thoroughly beforehand. This prevents unnecessary returns.

To achieve this, you can include specific terms and benefits in your purchase and return policy. Consider, for example, a loyalty program that rewards customers who order regularly and make few returns.

A good example of a loyalty program is that of H&M. This brand invites customers to become ‘club members,’ allowing them to earn points and eventually receive discounts.

8) Keep it positive

Every return policy must include the necessary rules and formalities. Things can go wrong, and the goal of a good policy is to provide solutions for these situations.

Unfortunately, because of this serious function, return policies often turn into a list of worst-case scenarios. If a potential customer lands there, it naturally has a negative impact on their mood and their enthusiasm for placing an order.

Therefore, try to keep your return policy as positive as possible. Write in terms of services and solutions rather than problems, and ensure the customer leaves the page feeling reassured and positive.

9) Speed is key

While product descriptions or ‘about us’ pages allow room for creative writing, a return policy should be as simple, short, and concise as possible.

No one has time to read long blocks of text, and potential customers may drop off if the return policy isn't clear within a few minutes. Furthermore, with an unclear return policy , customers will contact customer service more often, which costs time and money.

10) Findability

Finally, a tip regarding the placement of the return policy on your webshop.

As explained earlier, everyone is busy. In addition to wanting to read a return policy quickly, customers also want to be able to find it easily.

By giving the policy a logical place on the website, you prevent potential customers from giving up their search and abandoning their order or contacting customer service.

Therefore, give the returns page at least a prominent spot in the footer, as seen on the Loavies webshop below, or consider adding a button at the top of the page.

How to turn returns into exchanges

We already hinted that Returnista makes it possible to turn returns into exchanges. Because apart from drafting and offering a solid returns policy, you naturally want to keep the number of returns as low as possible.

This isn't just good for sustainability. It also helps retain revenue for your webshop. Did you know, for example, that you can convert up to 40% of returns into exchanges?

Here is how the exchange process works:

Exchanges based on live inventory

Returnista integrates with your webshop so that your product inventory data is always live. This way, you never end up in a situation where you offer an exchange for an item that isn't actually in stock. You can only offer what can be shipped immediately.

Proactively offering exchanges

In as many as 52% of return requests, the item turned out to be the wrong size. During the Returnista return process, the customer is asked for the reason for returning the product.

If the customer indicates that the purchase was the wrong size, you can immediately offer an alternative product. All of this is based on your webshop's live inventory. This is how you proactively turn returns into exchanges, helping you retain more revenue and build customer loyalty.

Keep shopping with coupons

With Returnista, you can provide your customers with a coupon during the return process equal to the value of their returned item. These coupons can then be redeemed immediately in your webshop for other products.

If the customer doesn't end up using the coupon, it automatically expires once the return is processed. This increases the chance that your customers will still make a purchase in your webshop despite requesting a return. It’s another smart way to retain revenue and turn the return process from a cost center into a revenue stream.

Need help?

Need help optimizing your returns process? We’re here to help.
With Returnista’s software, returns are no longer a pain point. Increase customer satisfaction and reduce your costs with a beautiful returns portal and a comprehensive data dashboard. Want to get more value out of your returns process like Decathlon, Loavies, and Asos? Request a demo on our website.