Return Policy: Understanding and Implementing a Return Policy for eCommerce Businesses

A return policy is a very important part of any business, especially eCommerce.

Furthermore, eCommerce businesses often face a significant number of returns; whether it operates online, in person, or a combination of the two. However, your online shoppers oftentimes don’t have the chance to try on or test the items they are buying in-store. 

So how can your return policy impact your eCommerce business? Read on to find out!

What is a Return Policy? 

Your return policy is the set of rules that manages how and when customers can return products after they buy. Generally, companies will provide an option to return a product for a refund, exchange it for a different item, or receive a store credit to use at a later date. 

How Do Returns Affect eCommerce? 

Returns tend to drive up costs for eCommerce businesses. In fact, according to an estimate by Statista, returns cost online businesses around $550 billion per year as of 2020, marking an increase of about 75% since 2016. 

However, a good return policy can help to encourage customer loyalty, which typically translates to increased revenue over time. 

Best Practices for Implementing a Return Policy 

Having a solid return policy in place is one of the best ways to maintain positive relationships with customers. Here are a few tips for implementing an effective return policy for your eCommerce business. 

1. Make Your Return Policy Easy to Find 

The more your customers have to hunt for your eCommerce returns policy, the more frustrated they’ll get. Make your return policy easily accessible from your website’s home page. 

2. Avoid Copying and Pasting 

Other companies don’t offer the same unique products you do. Therefore, your return policy should be as unique as your brand. Never copy and paste your return policy from a different seller. 

3. Make Your Policy Easy to Read 

You don’t want to alienate any customers who don’t speak English as their first language by using flowery text in your return policy. It’s important to remember that even the terms used on the “Returns” page of your website can help to boost your SEO.   

4. Avoid the Scary Parts 

Customers are generally put off by phrases that imply a high level of responsibility on their shoulders during the returns process. This includes phrases like “you need to,” “you are required to,” or “we will not”—basically, anything that makes your customers feel like they’re being punished for returning an item. 

5. Set Expectations 

Instead of focusing on what your customers who are making returns must do, focus on what they can expect from you during the return process. Can they choose their preference between store credit, an exchange, or a refund? Would you prefer to only offer one or two options?

If you’re still determining your company’s policies, you may want to try some A/B tests to see which return options your customers prefer.   

6. Offer Free Shipping for Returns 

If your customer has to pay extra to ship an item back to you that didn’t work out (or one that wasn’t fulfilled incorrectly), you’re likely to lose that customer for life. 

Do right by your customers and cover the cost of shipping for their returns, whether your warehouse made a mistake with their order or they simply want to return the product they purchased. 

7. Create a Return and Exchange FAQ 

Even if you think the information listed in the “Returns” tab on your website is foolproof, you’re likely to have some confused customers that aren’t quite sure what they need to do to receive a refund or ship back their item. 

You can make sure that some of the most common questions are easily answerable by including an FAQ section below your return information.

Even with an FAQ, your customers may still have questions about unique circumstances. Be prepared for this by providing a customer service phone number or email below your FAQ section so that they can contact your company directly. 

8. Create a Gift Return Policy 

A huge percentage of online purchases are made as gifts for others. These items may need to be returned for a variety of reasons. 

Consider extending your return window for gifted items to make the post-holiday return season less stressful for your customers. 

You can also make it easy for gift receivers to return their items without the gift giver knowing — simply don’t require an original packing slip.   

What About a Refund Policy?

Having a clear refund policy in place is crucial for customer relations and the success of your eCommerce business. Your refund policy will clearly dictate what your store can offer in terms of refunds depending on what a customer bought, when they bought it, and what condition the item is in. 

What to Include in a Refund Policy 

As you structure your refund policy, it’s important to include a few key pieces of information. 

Make sure that your customers know exactly how long they have to return the item before a refund is no longer available. Additionally, clarify whether the customer will receive a full or partial refund and what this result is based on (i.e., whether they return within a certain time frame or return the item in a certain condition).

You should also make it clear who will pay for the shipping costs if a customer does choose to return an item. We recommend covering shipping costs for your customers’ returns, but if you choose to do this, you’ll have to let the customers know how the logistics will work. 

Prioritize High-Quality eCommerce Returns

It’s clear to see that a good return policy is crucial for any company. But sometimes, this is easier said than done.

Having trouble managing your returns? Working with a third-party logistics company like Print Bind Ship can help you to streamline your processes and effectively manage all of your company’s functions.

You can learn more and even receive a free quote for services by visiting us online.