Richard Lim talks at ZigZag's Checkout Smarter Returns 2024

As ecommerce thrives, a silent crisis of serial returns is eroding retail profit margins like never before. Beyond financial losses, online returns create both operational and sustainability challenges for retailers. Through detailed insights, ZigZag and Retail Economics’ created the Annual Returns Benchmark Report 2024, which quantified the magnitude of this problem and provided critical insights into how to approach the issue as consumer expectations soar.

55% - Online represents over half of total non-food retail sales in the UK today

Against this backdrop, we asked Richard Lim, the CEO of Retail Economics to provide a keynote speech discussing the research at our Annual Checkout Smarter Returns event, held in October 2024. Richard broke down the key takeaways of the report, highlighting the four returner cohorts discovered, their preferences and expectations surrounding the returns experience, and their impact on the bottom lines of retailers around the world.

The four returner cohorts discussed included:

Serial Returners

Serial returners, though representing a minority of all customers, contribute disproportionately to overall return volumes. Their tendency to overorder, coupled with slow return habits, means that a significant number of items are returned past peak sales periods, lowering the chances of resale at full value.

Slow Returners

Those that typically impulse buy and suffer from buyer’s remorse later, typically taking longer than 10 days to send back their return. They can cost retailer’s billions per year by sending goods back after sales windows end or seasonal shifts.

Occasional Returners

Occasional returners believe they only return out of necessity, such as the good arriving late or damaged. They don’t set out to make a return and will rarely, if ever, intentionally make a purchase with the intention of returning it later.

Efficient Returners

The final returner cohort is the fan favourite. They require a seamless online portal, plenty of carrier options, communication, and fast refunds. But they have significantly lower return rates than both slow and serial returners and get goods back to the retailer quickly.

The talk provided those operating in retail (and related services) with actionable strategies to better manage the rising tide of returns to help protect profitability while strengthening customer relationships.

Richard also discusses the types of opportunistic behaviours displayed by the returners uncovered by the report and how retailers can battle them from paid returns and reduced marketing promotions.

The importance of effective returns management cannot be overstated. With profit margins already strained, understanding which customers are the most profitable – and which drive excessive returns costs – has become crucial.

You can also now view Laura and Jason's talk on how to appeal to these four returner cohorts as a retailer.

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