Disk shopping online this holiday season fueled another record for e-commerce businesses: merchandise returns.
Driven by a clogged supply chain, millions of buyers began scouting deals at Amazon, Walmart and other online retailers early on even before Black Friday, when holiday discounts traditionally begin. Locked away at home due to the pandemic, people kept clicking. Sold online hit $205 billion in the United States, according to Adobe, a new high for the holiday season.
All these purchases did not work. Unable to see or try the products, many people returned these gifts, along with their own online purchases, to retailers. The process creates headaches for businesses, which must sort and store items and decide if they have resale value. Returns also impact the environment, requiring additional fossil fuels to ship and creating tons of waste.
Returns are an integral part of retail. Clothes don’t fit, appliances have manufacturing defects, or buyers simply change their minds. Take that janky mixer back to the big box store and a refund to your credit card is usually quick and easy.
Online shopping has sped up the process as consumers often plan to return some of the products they purchase. This is especially true for clothes, which shoppers buy in multiple sizes to try on as they would in a fitting room. This mindset contributes to an estimated return rate for online purchases that is up to five times higher than for physical purchases, according to Optoro, a company that handles returns for online retailers. Retailers told the National Retail Federation they expect to see $158 billion in returned goods online and in-person holiday shopping, a 56% increase from 2020.
UPS expects to process more than 60 million holiday returns this season. In a survey, more than one in four people told the carrier they planned to return over the holidays. One in five said they had already done so before Christmas.
Retail giant Walmart, maker of bespoke women’s suits Koviem and other companies that want to reduce waste have invested in online tools designed to help you find the right size without trying on clothes. Additionally, some companies track customers who make a lot of returns, potentially prohibiting them from returning their purchases if they cross a certain threshold. Finally, some companies have even found it easier to let you keep the item as well as your refund in order to save on resources.
The bottom line is that while allowing returns can increase customer loyalty, companies don’t want returns to eat up too much of their vacation revenue, said Audrey Guskey, a marketing professor who teaches consumer behavior at Duquesne University.
“They really feel like it’s money in their pocket,” she said.
More online returns means more waste
To handle returns, companies run their fulfillment process in reverse. That’s not as efficient as getting goods to customers in the first place, says Tamar Makov, a researcher at the School of Business Management at Ben-Gurion University of the Negev. One of the reasons is that companies haven’t invested in the returns process to the same degree as they have for deliveries of your purchases. Sorting them is also a problem.
“Unlike products that come from a factory, returned products are not consistent and vary in condition, packaging, labels, or even how long they can be kept by consumers,” Makov said in an email. -mail.
Retailers simply get rid of low-priced items if it’s cheaper than reselling them, Makov says. An Amazon facility in the UK sent returned items to a “destruction zone” that disposed of millions of items in a year, according to ITV News. (Amazon said it was trying to donate or recycle goods.)
Optoro estimates that approximately 5.8 billion pounds of goods returned to all retailers in the United States end up in landfill within one year.
A return that ends up in the landfill is the worst environmental scenario. Scrapped items require even more fuel to transport because they make the extra trip between a return facility and the landfill. Rather than reselling your item, the retailer will send a new item to another buyer, which means more resources consumed. If a retailer sends your return to foreign recyclers, material recovery can release harmful chemicals.
Alternatives to mailing returns
You can reduce the environmental impact of your return by delivering it in person if there is a store near you. Of course, that’s not always an option.
A more efficient approach is to reduce the number of declarations you have to make. Retailers are trying to help.
Companies like Gap and Walmart are investing in software that helps shoppers find the right fit so they don’t “bracket” the industry term for buying the same item in multiple sizes and returning what doesn’t. not suitable. the practice is standard, with 58% of shoppers claiming to have done so, according to a 2021 survey by e-commerce customer service firm Narvar. This number has increased by 40% in 2017.
Services like Drapr, acquired last year by Gap, allow you to create 3D avatars to see how an item of clothing will look on your body. Zeekit, acquired last year by Walmart, also lets you upload a photo or choose a style that looks like you to see how the clothes fit (Walmart said it’s still developing the service for its shoppers). Alternatively, algorithms like Fit Predictor and True Fit estimate what size you should order based on your personal information, order history, or your size from another retailer. Koviem, the maker of women’s suits, uses 3DLook’s software that allows customers to see what their bespoke suit will look like.
More and more customers are also finding that a company will offer a refund without asking them to return a low cost item. AlixPartners, a management consulting firm, estimates retailers will refund $4.4 billion worth of merchandise without getting anything back from customers for purchases starting in 2021. One of those companies that allows “return” with no actual return is Jockey, who has confirmed that his customer service employees can approve this type of refund.
“We trust their real-time judgment to help customers,” Jockey spokesman Matthew Waller said.
If you end up with such a refund without return, you can give it to a friend or family member or offer it on an exchange for free items like FreeCycle or Buy Nothing. You can also consider donating it.