What are “green returns” and why do they matter?
JP Arnaud-Marquez
·December 26, 2023
Today’s shoppers are more concerned than ever before with sustainable shopping.
They buy better quality products that are built to last, so they won’t need to replace them every season, rather than springing for “fast fashion” that will fall apart within weeks. They pay attention to whether recycled or sustainably grown materials are used in the products that you manufacture, and whether you’re using eco-friendly power sources such as solar power or wind power in your factories.
And they’re willing to pay more for the sake of sustainability: Two-thirds of consumers say that they’d pay a premium for products that are sustainably produced. Modern shoppers are deeply concerned with climate change and social values, with 30% of shoppers saying they want to improve the environment; 23% wanting to reduce production waste; 22% concerned with reducing their carbon footprint; and 17% focused on animal welfare.
As an ecommerce brand, it’s important for you to listen to your customers and embrace sustainability all the way through the customer journey—from pre-purchase through to post-purchase. Simply ensuring that your products are sustainably produced is not enough: It’s also important to think about how the product gets to the customer (using environmentally-friendly logistics options and packaging), and, when a return is required, how it gets shipped back or disposed of.
The environmental impact of returns
Each year, as much as 9.5 billion pounds of returns end up as landfill waste. What’s worse, these returns are generally in like-new condition — the retailer has simply decided that they aren’t viable for resale. Adding to the environmental impact, these returns have been shipped back to the manufacturer, adding cost and carbon impact to the product’s journey.
Fortunately, some ecommerce shops are realizing there are more environmentally sustainable avenues to approach product returns. Let’s look at what best-in-class brands are doing to mitigate the environmental impact of returns, ensuring that they can maintain their approach to sustainability throughout the returns process.
New avenues for returns
Traditionally, retailers ship all of their returns back to the warehouse—regardless of whether those products can be sold a second time.
That’s wasteful in both environmental and economic terms. It requires return packaging and shipping for a product that will simply be sent to a landfill, and the entire reverse logistics process can cost around 60% of the original product cost. It’s not a great strategy for either a cost-focused retailer or an environmentally conscious consumer.
Luckily, many ecommerce retailers today are considering alternative approaches.
- Returnless refunds
If a product can’t profitably be resold, then why bother with the expense and carbon impact of requesting that the customer ship it back? In these cases, it often makes more sense to offer what’s known as a “returnless refund.” In other words, give the customer their refund, but encourage them to keep the product. They may choose to regift it to a friend or recycle it—but your brand will avoid the cost and waste associated with shipping it back only for the product to end up as landfill waste. - Donation centers
Your brand can also source opportunities to donate unwanted products and give back to local communities. The bedding and home goods company Brooklinen, for instance, partnered with Good360 to distribute all of its returned products to donation centers around the country. The products are used to supply bedding and other materials to local community programs — primarily to homeless shelters and women’s domestic violence shelters. - Resale programs
Even if products aren’t in brand new condition, it doesn’t mean they don’t have value to consumers. By partnering with resale companies, you can remarket your gently-used returns and open box items under a third-party branded marketplace program. Loop integrations like Arrive and Recurate can help you set up a secondary marketplace, enabling your brand to recapture lost revenue from your returns and ensure that the returned items see a second life. The shoe company Allbirds, for example, launched its Allbirds ReRun program, offering gently used products at heavily discounted prices. - Consolidated shipping
In cases where it does make sense for shoppers to return the product to your warehouse, asking them to pack and ship the item themselves isn’t always the most eco-friendly logistics path. Instead, consider setting up local drop-off centers, where the item can be scanned in via QR code, and consolidated into a bulk shipment alongside other returns. This option can help you conserve packaging and reduce shipping costs, while adding convenience for your customer.
Automating your returns process
If you want to make green returns easier to manage, a returns automation platform can help. By using a returns management solution like Loop, you’ll be able to set up conditional workflows that can ensure the right option for each return request—whether that’s offering a returnless refund, routing the product to a donation center, or sending it back to the warehouse. Shoppers will be able to use a self-service portal to manage their returns and see progress at every stage, enabling your brand to provide high-quality support without burdening your support agents.
Loop also helps you recapture more revenue from your sustainable returns by incentivizing product exchanges for ecommerce. By offering customers store credit immediately at the point of return that they can use on an alternate product, they’ll have another opportunity to find a product they love and maintain a relationship with your brand.
Additionally, the Loop Insights feature collects data around return reasons, helping your brand optimize your supply chain and product descriptions so that you can lower your return rate in the future, reducing your brand’s carbon footprint.
Becoming an environmentally sustainable brand involves making smart choices all the way through the supply chain, from manufacturing through to the return process. By prioritizing green returns, you’ll be able to offer consumers an eco-friendly experience from start to finish.
Want to learn more about how Loop can help with green returns? Sign up for a demo.
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