AUSTIN, Texas – 18th October 2018 – Brightpearl, the world’s largest purpose-built retail ERP platform, today reveals that two-thirds (61%) of US retailers are planning to ban ‘serial returners’.
These are shoppers who deliberately and regularly buy multiple items with the intent to return some. New research from Brightpearl confirms that this trend is on the rise – over two-fifths (42%) of US retailers have seen an uplift in serial returners over the last 12 months.
Retailers are feeling the strain as a result of this rising phenomenon. Following a move pioneered by retail giant Amazon – who in May started closing accounts of customers who “request too many refunds” – many brands are now considering banning customers that return too many items, with a quarter of retailers admitting that introducing lifetime bans for problem shoppers is a necessary move to protect their slim margins. In addition, nearly half (49%) of US retailers would impose bans to save time and administration resources – showing that chronic returns deliver many knock-on costs.
Of the brands Brightpearl spoke with, more than two-thirds (64%) of all clothing and fashion retailers are set to implement similar measures to Amazon, while 67% of consumer electronic firms plan to do the same. Perhaps more surprisingly, baby and toddler retailers are the most ruthless market segment, with 80% expected to ban serial returners in the near future.
There are many different reasons for consumers to return items – sizes not being standard, wanting to try different colors, and not being sure if a style or garment will suit – but chronic returning habits are proving expensive for businesses. Returns cost an estimated $351 billion in lost sales for US retailers each year (NRF). In association with Onepoll, Brightpearl surveyed 4,000 online shoppers and 200 retail decision makers to examine the measures that retailers are taking to combat serial returners – and how consumers are reacting to them.
The worst offenders are shoppers aged 18-34, where over a fifth (22%) of respondents confess to having intentionally bought more items than they intended to keep. Personal stylist Hester orders items totaling up to $400 a month – knowing that she intends to return up to two-thirds of the goods. She says, “In my opinion, 'serial returning’ is now the way of the world. I think that as consumers, we want, need, expect – and deserve – multiple options.
“I think banning shoppers, even ones who serially return, is a dangerous move for retailers – and it would change my shopping habits if the retailers I regularly ordered from did this. I think ultimately that retailers should trust their customers, and I wouldn’t order from a brand that had unfavorable return options.”
Researchers from Brightpearl found that unlike Hester, most shoppers are broadly in favor of bans for serial returners, with 58% agreeing it’s a fair policy. However, there are clear differences in attitudes depending on age groups, with 18-24s the least likely to be unconvinced. Overall, just 7% of respondents disagreed about banning serial returners, whilst one in ten (11%) said they would never shop with an online retailer who imposed bans for returning too many items.
Part of the problem of serial returning lies in the fact that many retailers do not currently have the right technologies in place to identify repeat offenders. 59% told Brightpearl researchers that they cannot identify – or do not know whether they can identify – who their serial returning customers are, identifying a need for brands to harness the power of technology for data insights and to track shopper behaviors.
“In today’s consumer-led retail environment, intentional returning could spell disaster for retail business owners if they do not have visibility over regularly returning customers. Without this, retailers will struggle with the definition and consistent application of their returns strategies – and could face a resulting backlash from shoppers,” said Derek O’Carroll, CEO, Brightpearl.
However, only 21% of retailers believe banning serial returners would lead to a reduction in return rates overall – suggesting that the increasing amount of returns the US retail sector is facing is here to stay. It also indicates that brands need to invest in technology to prepare for this growing trend.
Garment Quarter, a designer clothing brand, has done just that, to offset issues with problem returners. John Reid, Managing Director, says: “We introduced technology earlier this year that enables us to build a single source of information around customer returns, including the ability to monitor serial returners to see how the trend develops over time and whether we need to review our returns strategy.”
Brightpearl’s O’Carroll, adds: “Consumers are looking for fairness and choice when returning merchandise. Having the right software in place that offers a single view of returns data is essential to quickly identifying your cohort of problem shoppers, so you can make more informed decisions on how to combat them – while at the same time maintaining your relationships with loyal customers.”
Brightpearl has released a full report on this phenomenon, entitled “Banned? A Returning Problem”, which takes an in-depth look at whether retailers are planning to follow Amazon’s lead and cut off serial returners – and if shoppers will accept potential lifetime bans for returning too much. The full report is available for download at: https://info.brightpearl.com/banned
Brightpearl is a cloud-based ERP for retailers and wholesalers. Our mission is clear: automate the back office so merchants can spend their time and money growing the business. Brightpearl’s complete back-office solution includes financial management, inventory and sales order management, purchasing and supplier management, CRM, fulfilment, warehouse and logistics. In addition, the solution has high-performing connectors to the major e-commerce platforms, including Magento, BigCommerce and Shopify.
Brightpearl is designed for retailers and wholesalers and enables omnichannel merchants to manage the heart of their business easily from one single system. Our team guides merchants through a highly efficient implementation process which typically gets them up and running in less than 60 days. Founded in 2008 with offices in the U.S. and UK, Brightpearl is used by more than 1,200 merchants around the world processing over $1.4bn of orders in the last 12 months.