Brands are getting ready for the biggest holiday shopping season yet, with sales for Black Friday and Cyber Monday anticipated to hit $1.1 trillion this year. But after the flurry of holiday sales, there will inevitably be an influx in returns.
We’ve found from the past two years of holiday-shopping data that monthly returns are 83% higher in December and January compared to an average return month.
This, combined with the fact that 52% of returns on Shopify happen because of sizing issues, means that you can expect to receive a lot of exchange requests this holiday season. The best way to manage them? Online gift exchanges.
Gift exchanges save customers from awkward conversations
Every holiday season, my mom tries her best to pick out clothes that will fit me. But almost without fail, she guesses wrong and leaves me with a shirt or pair of pants that don’t fit. Thankfully, when she buys me something from a physical store, she always includes the gift receipt so that I can take it back and exchange it for the right size.
This year, my mom is definitely doing her shopping online, which should technically make gift exchanges easier. Unfortunately, many online brands don’t offer online exchanges. Instead, they refund all returns and make customers place a new order if they want a different size or color.
The problem is that the refund goes to my mom’s credit card - not to me - which leaves me in an awkward situation. Do I tell my mom she bought the wrong size again and ask her to exchange the item for me? Or should I not say anything and just be stuck with a product that I can’t wear?
This is a problem that many people will face this holiday season. That’s why an easier solution is to offer online gift exchanges and make the experience as easy as possible for the gift recipient.
How to offer online gift exchanges
Maybe you’ve never done gift exchanges online before. Or you’re unhappy with the current process. Regardless of your situation, you might not be quite sure how to approach online gift exchanges. It’s pretty simple. You just need to keep two best practices in mind
1. Put the gift recipient in control
Let’s say a customer receives a gift that’s the wrong size. As I mentioned with my own experience, if you don’t have an online gift exchange in place, you’re forcing your customers to either refund the item (which will awkwardly go back to the gift giver) or remain stuck with a product that they can’t wear.
Instead of doing this, put the gift recipient in control of the exchange by giving them the power to go through the process online - and without needing to engage your customer support team. There are tons of benefits to this approach:
More retained revenue. An easy gift exchange experience will make it more likely that the customer continues the relationship with your brand instead of requesting a refund and never following through on the exchange process. This means you’ll retain more revenue and cultivate more loyalty.
Repeat purchases. When you retain your customers and give them an awesome gift exchange experience, there’s a higher likelihood that they’ll be repeat customers. In fact, 92% of consumers have stated that they’ll buy something again if returns are easy.
Stronger brand perception. If a customer has to exchange gifts from multiple brands, which one do you think is going to make a better impression? The brand that lets the recipient seamlessly exchange gifts on their own time? Or the brand that forces them to jump through hoops just to get a sweater in a different size? Think of this as an opportunity for your brand to put its best foot forward.
2. Remove friction for your customer support team
If you’ve experienced post-holiday returns before, you know how much of your customer support team’s time is spent on back-and-forth exchanges with customers, printing out return labels, and answering straightforward questions. While we’re all about providing customers with high-touch experiences, we believe there are better places for them than just facilitating an exchange.
That’s why we encourage brands to remove as much friction for their customer support teams as possible. One of the best ways to do this is to use an on-demand return portal for your online gift exchange. This will automate most of the exchange process for your customer support representatives and free up a significant amount of their time. This, in turn, allows your internal team to focus their resources on helping customers with more pressing problems - such as sizing issues - and give them a better experience.
Online gift exchanges in action
We recognize that doing gift exchanges manually is hard or close to impossible to do on your own. That’s why, at Loop, we offer an on-demand and automated return process to make it simple for your customers to exchange for a new size, color, or different product altogether - without putting a ton of burden on your support team.
Let's show you how that works.
The gift receiver is is presented a portal where they can begin the exchange with the order number (usually included with the gift), and the original shipping zip code. Now, if you want to fully put the receiver in control they might not have that order info. They can still mover forward with the link at the bottom.
Once a customer has found their order they now need to be able to change the contact information. The first order was sent to the gift sender. To put the receiver in control they need to be able to change the shipping address and contact information. This would normally be several back and forth conversations with your team, but now the customer can do it on their own.
As soon as the gift receiver changes this information they can now select a different size, style or a completely new product. It's that simple!
Essentially, our portal gives customers the power to:
Start the return process by searching the order number or zip code
Change the address associated with an order
Select a new item without having to process a refund first
Don’t overlook the value of online gift exchanges - especially during this upcoming holiday season. Not only will you be giving customers the best experience possible, but you’ll also be doing your business a favor from a revenue, resource, and branding perspective.
Want to have your on-demand returns portal and gift exchanges ready by the holidays? Learn more here.