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How To Increase Customer Loyalty Through Returns

Customer loyalty and retention are some of the key measures of service level among many companies. There are plenty of ways to improve customer retention. But there seems to be a secret key to keep getting loyal customers – even if their purchase didn’t satisfy them. This secret component is an easy returns process.

Why does your returns policy matter?

For many companies, returns sound like a thing that should be avoided at all costs. It drives profits down, and the harder we make the process, the fewer returns there will be. But the truth is quite the opposite. The smoother and easier it is to return a product, the higher the probability for a customer to order from you again. Let’s take a look at some key takeaways from different studies:

  • 69% of shoppers won’t buy from you again if they have to pay for returns
  • 81% of shoppers will only press ‘Buy Now’ if you are offering free returns
  • 66% of customers will review your returns policy before completing a purchase

Apparently, returns can not only increase your customers’ loyalty and provide a positive shopping experience but can greatly boost spending on your platform. According to a Journal of Marketing Studies, some companies have seen a 457% increase in spending from customers that had an easy and hassle-free returns experience. So improving your returns process may open a golden gate for new customers and drastically encourage existing ones to shop more.

How to increase customer loyalty through returns?

There are several ways to enhance and ease the returns process. It is crucial to make sure that your products, website information, and order fulfillment doesn’t have gaps that lead to returns in the first place.

Offer free returns

First and foremost, make sure to arrange the easiest funnel for making a return. This includes stating a clear, accessible policy on your website. Ideally, returns should be free. Consider this when planning your budget and keep in mind that acquiring a new customer costs 5 times more than retaining an existing one. A smooth return experience drives more profits, and free returns pay off.

Communication and convenience

When a customer returns an item, there will be a lot of questions. Apart from outlining a perfectly clear FAQ, get ready to answer questions, and do it quickly. Providing good customer support is essential for polishing your overall returns strategy. In terms of convenience, it’s worth to knock your customers even further to retaining. A good way to do so offers a discount for the next purchase or a loyalty program.

Ask for feedback

Asking your customers directly is probably the best way to get some valuable marketing insights. Make sure to ask for feedback, send surveys, etc. Also, analyzing return patterns can help you uncover hidden problems with products or services. For example, if you see customers are often returning particular items, consider checking image quality, or other factors can influence discrepancy between expectations and reality.

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