Your checklist for increasing profitability this holiday season
Learn how you can improve holiday profits by focusing on returns.
October 21, 2022
Managing an online store during high season is no easy feat, especially with heightened customer expectations and holiday shopping starting earlier than ever. In our Returns & Retention Benchmark Report, we discovered top return months for most verticals fall in December even before the holiday gifts have been opened.
However, high season doesn’t only present an opportunity to provide a seamless returns experience helping save time for your team, but it also provides an opportunity to improve profitability by reducing returns, capturing more refunds and building long-term loyalty. That’s why we’ve put together the following checklist to help merchants maximize profitability and revenue during the holidays and beyond.
Lower shipping costs with smart label generation
Consider ways to drive down shipping costs throughout the holidays when outbound and inbound volume is at its highest. One way Returnly merchants do this is with rate shopping across carriers. When generating a return shipping label for a shopper, Returnly checks rates from all carriers and automatically purchases the lowest cost label available. Based on our early access group, the average merchant saves over 30% on labels purchased, with other merchants enjoying over 50% savings.
Eliminate shipping altogether without risk
Today’s modern shopper expects to have choices when it comes to returns – both online and offline. For example, leading Canadian retailer Grafton Apparel (Tip Top, George Richards, Mr. Big & Tall) sees 60% of returners visit a store location instead of returning online, saving over $16,000 in shipping costs while providing store associates with the opportunity to guide returners to finding another item.
You can also give customers the option to keep items that you can’t resell or are below certain dollar values. Returnly has a smart keep-the-item policy built on machine learning so this premium experience doesn’t get abused. With an average savings of $17 per item, merchants experience a return on investment with as few as three Green Returns per week.
Provide returners with more paths to repurchase
When a purchase doesn’t work out, a return doesn’t have to result in a refund. One surefire way to increase profitability throughout the holidays is by supporting exchanges – especially differently priced exchanges to capture uplift on higher priced selections. A way to supercharge your retention is by offering Instant Credit. Merchants offering Instant Credit generate 34% average uplift on repurchases. Plus, Instant Credit orders ship instantly. This means your customers get the right product in time for the holidays without any stress for you or them.
Have a plan for giftees
Purchasing a gift comes with its own unique challenges, sometimes rolling the dice when it comes to sizing and personal preference. Be sure to offer a way giftees can find another item. For instance, Returnly’s Gift Exchanges allow customers to exchange for their preferred variant, another product, or return for store credit, keeping that sale on the merchant’s books. Best part is, the entire experience is discreet and self-serve with no notifications or hurt feelings for the gifter.
Leverage data today to reduce holiday refunds
Ensure your team is set up to track customer insights to better understand why certain items are being returned and drive improvements results in higher LTV and less returns over time. Returnly surfaces return reasons by product type and captures customer sentiment (CSAT), helping you better understand what’s being returned and why. Make changes to your site today that will reduce returns down the line.
As big investments are made to drive Black Friday and Cyber Monday sales, it’s important to remember the opportunity that comes along with returns. Finding ways to turn holiday sales into loyalists with smarter returns and exchanges is key to achieving more sustainable growth.
As part of Affirm, the company behind Shop Pay Installments, Returnly is offering our Starter Plan at a discounted rate of $49/month until January 31, 2023, to merchants using Shop Pay Installments. From sign-up to launch, integration with Returnly’s Starter Plan takes a matter of minutes – not days. Install the App today.
To unlock your store’s full holiday potential, contact sales to learn more about our revenue generating and cost reducing features.