Return Drop-Off Points Are a Win-Win for Retailers and Consumers
Returns are a headache for retailers and consumers alike, but satisfaction with third-party drop-off options is high among consumers. Expanding that service for e-commerce returns also offers retailers the benefit of logistics consolidation.
While consumers have packed away their holiday decorations and set their sights on a fresh start in the new year, retailers know the holiday season isn’t really over until the returns are in. In a Jan. 4-5 Morning Consult survey, 9 percent of consumers indicated that they’d already made a holiday return, and an additional 9 percent said they planned to do so in the upcoming weeks. Most of these returns will be apparel, so department stores and fashion retailers especially should take heed of return trends.
Traditionally, most consumers make returns through retailers’ own stores, which is great for foot traffic and return logistics. The challenge for brands lies in the growth of mail-in returns due to e-commerce expansion; this year, UPS anticipates a 10-percent increase in return packages over its 2020 peak. The associated cost and logistical challenge have led retailers to re-examine return options and costs for consumers.
Of those who made a return in the last month, 53 percent returned to a store, and 34 percent returned by mail. Most interesting, though, is the 29 percent of consumers who reported using a third-party drop-off site. This growing option allows e-commerce brands to reduce costs and streamline returns by consolidating shipments at hubs, and consumers are fans.
Third-party drop-offs received the highest customer satisfaction rating of the three return options evaluated. Satisfaction is high for all three channels, but third-party drop-off beats the rest on the “very satisfied” rating. Cost doesn’t appear to be a factor here; about half of returners surveyed reported having to pay a fee to return items either by mail or at a drop-off site. Drop-off locations are often more convenient for consumers and don’t always require repackaging the item or printing a label (crucial for those who were dependent on office printers prior to working from home).
Beyond Amazon’s much-touted partnership with Kohl’s, providers like Happy Returns help facilitate connections between smaller e-commerce brands and brick-and-mortar return hubs.
E-commerce brands should explore establishing third-party drop-off return partnerships where there is brand alignment and sufficient local order volume around partners’ brick-and-mortar networks. This will improve customers’ return experiences and help streamline returns operations.
Claire Tassin is the lead retail & e-commerce analyst on the Industry Intelligence team, where she conducts research, authors analyst notes and advises leaders in the retail & e-commerce industry on how to apply insights to make better business decisions. Before joining Morning Consult, Claire was an analyst at Gartner, where she conducted research on shifting consumer behaviors and expectations, as well as trends and technology relevant to marketing leaders in the retail sector. She graduated from Washington University in St. Louis with a bachelor’s degree in psychology. For speaking opportunities and booking requests, please email [email protected].