10 Ways to Minimize Product Returns
❏ Last week I spoke to Monetize Your LinkedIn Contacts (LINK). This week I’ll speak to 10 Ways to Minimize Product Returns. Customer returns are the bane of doing business. Often the cost of taking back a product is more than the original profit! Additionally, you often have an unhappy customer that you have to handle. Want to learn how to minimize this pain? Let’s get started!
As an Executive Coach, I help founders find the right kind of help at the right time. Whether you run an early stage business or are doing millions per month online, returns can cripple your cash flow. Last week I taught you how to Use LinkedIn Contacts for Email Campaigns (LINK). This week I’ll show you how to 10 Ways to Minimize Product Returns. Returns create issues starting with negative customer reviews up through chargeback issues. I want to share with you ideas for how to minimize all your Return issues. Ready? Let’s get started!
Issue 1: The Wrong Item Ordered
Ordering the wrong item is one of the most frequent reasons for Returns. People are in a hurry. Sometimes they “fat-finger” the wrong color, size, or quantity. This mistake is going to happen. The question is how do you minimize it?
Start with a review of your website item page layout. Look at the method you use for each input you require a user to provide to put an item into the shopping cart. Are the button and selectors appropriately sized for both the desktop and the phone?
Often buttons are too small and too close to each other.
Sometimes you have an error on a product page where the user can add an item to the cart without having made the required option selections. Do you have a default color or size in a selector? Remove it now! Make every selector need a customer input.
Make sure the “add to cart” button is not visible or selectable until after the user has made all the required selections.
Once you get to the cart, how do you show the customer the cart items? Most people use a written list. PEOPLE DON’T READ! Instead, use a highly visible image of each object. If the article had a color choice, show the item in that color. Size options should appear in a large font directly next to or below this image. Show the quantity, if more than a single unit, in a large, bold font. Even better, if the user orders two identical items, show two images side-by-side to catch their eye if they only meant to order one.
Issue 2: Product Description Not Accurate
We’ve all seen it. An overzealous marketer writes an over-the-top product description. The product description reads like you’re getting a Ferrari but what shows up is a Pinto. A more common reason is the color, size or quality look-and-feel do not match the images on your website. Color and size are seen most often in clothing and jewelry. It’s difficult to deal with meeting color expectations, but you can take steps. Make sure the image you use is large enough for the customer to see colors. For sizes in clothing, measure it yourself. If a manufacturer labels it a size 10, but it closer to a 12, say so clearly in your sizing table. For jewelry, show it next to coin currency.
Give sizes in both English and Metric systems.
Issue 3: No User Reviews – Fake Product Reviews
Many sites don’t allow users to post reviews. Often this is for fear of getting lots of one-star reviews. More modern websites (think Amazon) can only allow reviews from “confirmed buyers.” This method stops one-star spam attacks. Enable user reviews on your site. Respond within one business day to all review rankings, both five stars, and one star.
We’ve all seen this. A new product launch and instantly there are hundreds of 5-star reviews. Consumers recognize these as “fake” reviews, and most will instantly move on to a competing product. Don’t use fake product reviews. Don’t pay people to do product reviews. If you give a product for free or at a deep discount in return for a product review, clearly state so in each review. Confirmed Buyer reviews are incredibly powerful for generating new and repeat business. Don’t screw things up trying to “game” the system. Provide a great product at a fair price and ask for reviews in your shipment and post-shipment emails.
Issue 4: The Wrong Item Shipped
We’ve all received the wrong item if we’ve lived long enough. Why does this happen? Usually one of two reasons. The shipper slapped the incorrect label on the box is one. Another is the person packing the box put the wrong item in the box. There is a good way to catch both. Use tracking the box size and the total weight. If you scan each shipment before leaving your facility, you can read the box size and box total weight. Your shipping system should be assigned a box size to each load. If the items are too large or small for the box that is specified, your packing team will flag it.
An incorrect item in the system identified box will often cause the total weight to be larger or smaller than expected, and a weight check at outgoing QA should flag it. If your process requires scanning of an item before being boxed, then your system should stop that error type. Bottom line, setting up the right process and software should all but eliminate shipping the wrong item.
Issue 5: Damaged Items
Which of you hasn’t gotten a box that looks like an Orangutan jumped up and down on it? Not you? Your turn is coming! Crews that handle boxes in shipment are not always the most careful. Plus, anyone can just have a bad day and drop something. The key is using appropriate shipping materials for the goods before shipment. Ever open up an Apple iPhone box? They are an excellent example to follow. I think a 200-pound person could step on an unopened iPhone shipping box and the iPhone inside would be undamaged.
Now you don’t have to design custom boxes but use some common sense. If you have a “soft” item (clothing) make sure it is in a plastic bag to protect it from the elements should the shipping box open. If it’s a breakable item, use copious amounts of bubble wrap or a similar material that ideally is recyclable.
Issue 6: Poor Product Quality
Everyone expects most items that they buy to last a “reasonable” time. Sadly reasonable is different for every person. If I’m paying $1 for an iPhone case, most people expectations will be low. If I pay $50 for an iPhone case, and what I get looks like many $1 – $10 cases, many of your customers are NOT going to be happy. I’m all for maximizing one’s profit margin, but the quality of the product you ship MUST MEET or EXCEED your customer’s expectations.
Issue 7: Charge for Opened Item Product Returns
Sadly some customers buy an item, use it for a brief period, then ask to return it. Today, most large retailers accept many large businesses allow returns for any reason. If you sell items that a customer wears, this can lead to a form or showrooming. The custom buys an article for a party, wears it, then sends it back afterward. You’re stuck with a used item that you can’t resell as new, if at all. What can you do?
One option is not to allow Product Returns on opened items. This policy will likely negatively affect your sales if your competitors allow returns for any reason. For electronic downloads, such as courses, you can get probably away with “All Sales Final” if the item is below $20. Higher priced items such a policy will likely dramatically reduce your sales. For most product, allowing a return for any reason within 7 to 14 days is the norm. Business has found that this return policy has increased sales. Yes, you will get returns, but you need to figure that into the “cost of doing business.”
Another option has what many call “a 15%-20% restocking fee” and require the consumer to pay shipping costs for returns. Shipping costs are not charged up front but instead subtracted from the check or credit adjustment after the return. Again, this will likely negatively affect your sales if your competitors allow Product Returns for any reason. Yes, you will still get Product Returns, but you need to figure that into the “cost of doing business.”
Issue 8: Fire Bad Customers
If you have customers who regularly return items, you need to “fire” them. These people are abusing your return policy and are costing you more than you are making on them. Make sure your CRM tool can identify customers ranked by some Product Returns and return rate. Review this weekly. When you find such a customer, inform them that you are unable to accept any future orders from them. Block both their address and credit card from being able to be processed through your system. Unless you do both, they’ll likely just change one and keep buying from you.
Issue 9: Change Packers
Sometimes you packing service packs the wrong item in the box, even though all the paperwork is correct. To me, this is inexcusable. Your Packers should never pack the incorrect product. If they do, it usually means that they don’t have the right processes in place. It’s not your job to suggest fixes to them. Find another packing service. Ask candidates to go through the details of their packing process. They should be able to bring out workflow diagrams showing their packing workflow and how it ensures 100% correct packing. If not, keep looking until you find one, then fire your current packing service.
Issue 10: Change Shippers
Sometimes you are shipping service ship the right item to the wrong person or address, even though all the paperwork is correct. To me, this is inexcusable. Your Shippers should never ship to the incorrect person or address. If they do, it usually means that they don’t have the right processes in place. It’s not your job to suggest fixes to them. Find another shipping service. Ask candidates to go through the details of their packing process. They should be able to bring out workflow diagrams showing their shipping process and how it ensures 100% correct shipping. If not, keep looking until you find one, then fire your current shipping service.
I hope I have educated you on how to 10 Ways to Minimize Product Returns. If you follow my advice, you’ll have fewer unhappy customers, lower return rates, fewer chargebacks and better social media rankings.
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