How to handle returns on Online Marketplaces?
Throughout Europe, the use of eCommerce is on the rise with the number of e-shoppers increasing from 60% to 73% over the past 5 years. As the industry evolves, there is a high expectation from consumers for an easy and convenient buying journey–from a variety of selections to same-date delivery and, most importantly, easy returns.
Many shoppers turn to online marketplaces, instead of ‘brick-and-wall’ stores, due to their ‘hassle-free’ return policies. Most, (not all) marketplace platforms nowadays allow buyers to return their goods, however the processes can differ per marketplace.
How do the different marketplace platforms handle returns?
When consumers on Amazon want to return a purchased item, sellers will have two business days to review and answer their request, before issuing a refund or replacement. This might differ depending on the product category. Once the return is approved, Amazon will send the buyers a return shipping label with the company’s return address. There are two different types of labels that can be provided–prepaid and non-prepaid. By default, the return label that Amazon provides is non-prepaid and requires the buyer to add postage. However, sellers can also provide a prepaid return label, which in some cases is required, such as: product damages, defects or material differences. Afterwards, the seller must issue a refund to the buyer within 2 business days. Depending on the condition of the item, sellers can issue a full or partial refund.
Besides manual processing, sellers can consider using middleware solutions to automate their returns. Via the API connection, sellers can import and update return information from Amazon to their own system, with the use of integrators.
Sellers who are active on Bol.com can choose either their own return service or Bol return service. If sellers wish to arrange the return themselves, they must take care of the return cost, by cooperating with either their delivery providers or their own logistics department to be able to provide the ‘free’ return label to consumers. Meanwhile, the return service from Bol offers an automatic return process with a lower return cost per package. Consumers can always return the purchased item free of charge. The return label they receive, after submitting a return request, will always have a track and trace code attached. As convenient as it might sound, products returned via Bol service are not insured.
It is also possible for sellers to automatically synchronize their product flow, including returns, to Bol.com, with the use of API and integrators. This will save sellers precious time on manual actions and improve delivery reliability.
Compared to other marketplaces, the return process of Zalando is rather simple. Brands that are Zalando’s partners can benefit from the logistic capabilities of Zalando Fulfilment Solutions (ZFS), with consolidated orders and straightforward returns. The entire fulfillment and return process is done by the marketplace. Consumers will always receive a return label delivered along with their order. They can return multiple orders from multiple brands in one box, which is more convenient and environmentally friendly.
For brands that are not ZFS partners, consumers can also return the order directly to them via the brand provided return label within the order. If the consumer needs a new return label, brands will need to provide one either via email or Zalando Customer care portal. Non ZFS partners are required to refund to the consumers within 6 days, this also includes any time needed for investigation.
The French marketplace seems to be slightly behind other platforms like Amazon or Bol.com, etc. When it comes to return requests from consumers, sellers on CDiscount have two working days to provide a compliant and valid solution. After providing a return label, the refund must be made within the legal time limit, which is within 14 days of the consumer’s notification of return. Unlike other marketplaces, sellers on CDiscount must be responsible for offering and communicating the return instructions to consumers via the marketplace’s message portal, including providing return labels. For sellers that are not based in France, they will need to provide a prepaid return label.
At this point, there is still no connection between integrators and Cdiscount to automate the return process. However, there are possibilities for sellers to build their own API connection with CDiscount, which allows automatic return management.
How to avoid more returns?
Return hurts marketplace sellers in three main ways: it cuts into the profit, increases the logistic cost and decreases your performance score. To avoid returns, it is essential for sellers to make sure that consumers are well informed about the product and its features or benefits. Detailed and accurate product listings with good use of creative content help to avoid misunderstandings, especially for apparel and footwear items, given that 70% of returns from this category on eCommerce platforms are related to sizing issues (IMRG, 2021).
Efficient customer service is also worth considering, as this might limit potential returns by good communication and alternative support, for example: exchange and/ or refund.
Although it’s important to prevent returns in the first place, this can also be an opportunity for sellers to step up their service and loyalty game, by quickly responding to the request and rapid refund, making the process as convenient as possible for consumers. In fact, consumers tend to make purchases if sellers offer an easy and ‘hassle-free’ return process, 6 out of 10 consumers even check out the return policy first before buying something (Invesp, 2022).
Returns, while not ideal, are an inevitable part of marketplace business. How sellers can minimize the damage pretty much depends on how informative and accurate the product content and information they can provide. As an innovative digital agency, Emakina is happy to help you accelerate growth with marketplaces. From strategic decisions to technical topics and optimizing performance, our international experts can act as an extension to your team, helping you to seize every opportunity brought by marketplaces.
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