Return to Sender

Consumers are returning more products than ever. Is your brand prepared for the deluge?

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In Today's Issue

E-Commerce • Product Returns are Way Up

A strange new trend appears to have emerged over the holiday season and it’s not great for people who sell physical products online.

A new report by Coldwell Banker and Optoro sheds light on a growing challenge: returns. With e-commerce sales expected to hit between about $275 billion this year, returns are predicted to account for a staggering $82 billion. This marks a substantial increase from previous years.

Retailers are feeling the impact.

  • Nearly 9 out of 10 have revised their return policies

  • 44% have increased return and restocking fees

  • 40% have expanded return drop-off locations

The cost of returns has skyrocketed by 50% compared to 2018, now averaging 27% of the purchase price. This rise is significant enough to potentially halve a product's sales margin.

But there's more than just financial cost.

The report highlights an environmental concern: returned goods contribute about 9.5 billion pounds of waste to landfills annually.

Retailers are adapting to these challenges. Companies like H&M and Amazon have modified their return policies, often incorporating fees.

Has your brand seen increased product returns from your customers?

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Shipping • Do Consumers Care About Next-Day?

So while returns spike, and online retailers obsess over service improvements like returns and same-day vs next-day delivery, turns out those latter options may not be as valued by consumers as expected.

A recent Forrester report found that while 75% of U.S. online shoppers prioritize free shipping, only 20% consider next-day or same-day delivery crucial in their shopping decisions.

Surprisingly, 47% stated that same-day delivery doesn't influence their choice of retailer or brand at all.

Instead, Forrester highlights more cost-effective alternatives like buy online, pick up in store (BOPIS), curbside pickup, and drive-thru options. These services are gaining interest, with 22% of consumers now opt to pick up in store, 27% prefer curbside pickup.

Despite these findings, major retailers such as Target, Walmart, and Amazon continue to enhance their same-day delivery capabilities. Amazon, in particular, has attributed its success in this area to investments in regional operations and an increase in same-day delivery facilities.

Overall, delivery times have improved, with the average time from order placement to final delivery now around four days.

Snapchat • Partnership to Bring TV Insights

To social media now, and Snapchat — which this week announced a new measurement partnership with Samba TV. This should give Snap’s advertisers in the entertainment sector a deeper understanding of the effectiveness of their in-app campaigns.

Samba has some impressive reach into most of the major TV platforms’ 'walled gardens', — they claim to be connected to 48 million smart TV devices, which lets them tie activity to free-to-air, cable, and streaming content.

This partnership takes effect from today, and Snap's advertising partners will soon have access to these enhanced measurement tools.

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