The psychology behind customer return decisions

To build a compelling brand, you need to understand your customers.

That starts with attracting them: What makes them tick? What types of advertising messaging and images are they likely to respond to? What will motivate them to go from simply clicking on your product pages to actually making a purchase?

But it doesn’t end with that initial conversion. Building sustainable shopper engagement is key to creating a sustainable brand—so you’ll need to come up with strategies for building an ongoing relationship with your customers. Show them that you value their continued loyalty, and use personalized messaging strategies to keep them engaged over the months and years to come.

Another crucial part of understanding your customers is understanding why and when they choose to return products. In this article, we’ll look at the psychology behind customer returns, and how you can use these insights to build a stronger connection with your customers.

Leading factors behind customer returns

In ecommerce, up to 30% of purchases end in a product return. So why does that happen?

Here are some of the most common reasons for product returns:

• The product doesn’t fit correctly
  In fashion or footwear brands, 70% of product returns happen because of a poor fit or style. When the customer doesn’t have the opportunity to try on a product in advance of purchase, they may not know what size to choose, or they simply may not be happy with how it looks on them once they’ve tried it on.
• Product damage or defects
  Many consumers have returned products because they arrived damaged or with defects. PowerReviews found that 81% of consumers have returned products for this reason.
• The item description was inaccurate
  Sometimes, customers feel that the product they purchased doesn’t match their online description or images. Fifty-six percent of shoppers have returned a product for this reason.
• The customer purchased multiple products with the intention of sending most back
  Many shoppers now regularly engage in “bracketing”—a form of return abuse in which they purchase multiple products to try out, with the intention of only keeping one. About 60% of shoppers say they engage in this practice.
• The customer has buyer’s remorse
  One in four people admit to making impulse purchases that they later regret while they’re under stress. These items could be products they don’t really need, or items that are a financial strain for them. As a result, they’re more likely to return these products.

As you can see, there are many potential contributing factors when it comes to product returns. As a retailer, it’s important to dig in and understand which factors are contributing to your returns, so that you can enhance your operations accordingly.

Use return insights to inform your business strategy

By using a returns management platform like Loop, you can ask customers why they’re returning a product: Was it too small? Too large? The wrong color? Defective? Simply changed their mind?

You’ll be able to aggregate your data and use it to identify trends in return reasons—across products, categories, and even individual customers. Leveraging this feedback will help you answer questions like:

• Are customers confused by your sizing?
  If you’re frequently seeing product returns come in because products run too large or too small, it’s important to enhance the accuracy of your product description pages with better sizing information. When a customer adds a product to their cart, you can inform them that “other customers say this product runs small, order a size up.” Encouraging customers to contribute their own reviews, including their height, weight, and size ordered, will give shoppers a more accurate look at how the product will fit them, which should also help discourage bracketing.
• Are products coming back due to defects or shipping damage?
  Pay attention to returns due to defects to identify potential trends in manufacturer errors, and use that data to either work with your manufacturer to correct the issue, or choose a new supplier. If you’re frequently seeing returns due to product damage, the issue is likely due to your shipping practice. In this case, look for opportunities to add protective packaging to your shipments, and evaluate the performance of your last-mile delivery carrier to ensure that they are not being careless with packages.
• Are products being sent back due to inaccurate descriptions?
  If products are being returned because the customer feels like the product was falsely advertised, find out what didn’t live up to expectations. Did the color look different in your staged photos than it did in the customer’s home? Was the product material thinner than the customer expected? If this is a regular issue, it’s important to add new photography and video to your product pages, showcasing the products in different lighting conditions. It’s also valuable to encourage UGC photos and videos, which can showcase your customers’ experiences with the products.
• Was the product too expensive for the customer?
  If customers are regularly purchasing your products, but then returning them due to the price, you can consider several options for dealing with the problem. If it makes sense for your business model, you might consider lowering the price of the product, or developing a less premium, more affordable version of the same product. You can also consider leveraging “buy now, pay later” (BNPL) financing platforms, which will allow customers to pay off the product over time at a low interest rate to a third party financing platform.

Reducing returns through exchanges

Beyond making operational changes to reduce your brand’s return rate, you can also use customized workflows at the point of return to encourage customers to consider alternative products.

Encourage customers to exchange their unwanted item for another product—whether a direct variant in another size or color, or an altogether different item. Using Loop’s portal, they’ll be able to directly apply their return credit to the cost of an exchange, even if they’re choosing a different product. Facilitating streamlined exchanges removes friction from the exchange experience, making it more likely that your shoppers will try out a different product.

By understanding the psychology of why your customers are returning products, you can offer personalized exchange opportunities for them—showing that you value their needs, and making them more likely to stick around for the long haul.

Want to see how Loop can help you deliver personalized exchange opportunities?

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