Business Ecommerce

The Plague Called E-commerce Product Returns and Its Solutions

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E-commerce’s popularity is evident from the fact that 60% of US millennials now do their shopping online while another 20% want to build a successful online shopping platform. Building a million-dollar online business is the dream millennial career; varied incubation and hostel programs are providing webmasters and entrepreneurs with the requisite funding to pursue their digital dreams.

While thousands of freshers are betting big on e-commerce platforms, there are hundreds of people who are distancing themselves from the idea of e-commerce. One intricate look and product return emerges as the prime factor coaxing people to stop drop-shipping and online selling services. 

Product return not only eats up profit but also dents the overall customer experience. It is a two-edged sword that affects both sellers as well as marketplaces. For standalone stores, product return is perhaps the biggest challenge because it erodes both the customer base and profits slowly. 

Statistics That Prove Product Return is a Prime Problem

  • 1 out of 3 products ordered online are returned
  • 92% of customers will buy products only if there’s a return policy
  • 23% of returns occur because a wrong or fake product was delivered 
  • 20% of returns occur because customers received damaged product
  • 22% of products are returned because they look different in real life

What are the Factors that Influence Product Returns?

To rectify errors and control product returns, marketplaces first need to become aware of the factors that are influencing product returns. While fake or imitated products remain the biggest reason for increasing product returns, there are other factors too and these areas need immediate attention. 

Catalog Errors: Sellers are now deliberately trying to dupe customers. The increased popularity of e-commerce stores has grabbed the eyes of thugs and there’s a nexus working resolutely to cheat.

 Error in catalogs is often related to product descriptions where the sellers claim their product to be original. They copy product descriptions and images from genuine products and ship fake products as soon as they receive an order. Later these products are returned, which impacts both sellers as well as marketplaces. 

Misplaced Attribute Values: Attribute values are used on e-commerce stores to simplify categorization and sorting. These attribute values when placed correctly can generate cross-selling opportunities and also add up to improved product discovery. 

Now sellers with fake or imitated products have started to abuse these attribute values. They deliberately add fake attribute values to their imitated products and acquire ranking for branded keywords. Customers view the imitated products as genuine and end up buying it only to return it later. 

Brand Interference: When fake product descriptions and wrong attribute values are added to catalogs, these products start ranking for genuine keywords, which creates brand interference. Local brand shoes ranking for Nike shoes is an example of brand interference. Fake products that look exactly like original products impact the sale of genuine products and also increases the overall return percentage. 

Errors By Sellers: Sellers are now receiving hundreds of orders, making it tough to cater to every order with proper attention. The decreasing attention span per product is leading to errors. Often wrong products or sizes are packed and delivered. These orders are often converted into returns or replacements which increases the cost of product delivery and also eats up the underlying profit. 

Why Controlling Product Return is Important for E-commerce Players?

In times where customer experience is the key differentiator and over 84% of customers are not willing to collaborate with a brand after just one bad experience, e-commerce stores cannot let increasing product return ruin their reputation.

If any marketplace decides to ignore increasing product return, they are simply going against the wind, and sooner or later they will pay heavily for it. Here’s how increasing product return will impact e-commerce players:

Loss of Funds to Sellers: Sellers are operating on very low margins and increasing return requests will push them out of the ecosystem.

Dipping Customer Experience: Customers today have multiple options and they are not going to stay with a brand that doesn’t value their time or money. 

Brand Reputation: With increasing product return and customer churn, the NPS is going to take a hit and it will reflect in the market value. For listed companies, stocks will fall while the non-listed will have a bad reputation among investors. 

How to Fix Product Return Problems?

The good thing about product returns and the factors driving them is that there are cures for it. For every factor that leads to increasing returns, there are solutions, which when followed ardently can change the game for the better. 

Catalog Quality Checks: Rigorous catalog quality checks will help marketplaces and sellers identify products that are listed in the wrong categories and sub-categories. When products are listed under the wrong categories, they fail to reflect in relevant search results which impacts the customer’s ability to make informed decisions.

Apart from less exposure, brand interference is another problem that arises when products are listed under the wrong categories. Customers will start to see women’s clothing even when searching for men’s t-shirts. Once identified in catalog quality checks, such errors can be rectified through Catalog Enrichment.

Get Rid of Duplicate Content: Want to make it easier for customers to find the right product and order it instantly? Start by getting rid of the duplicate content. Some sellers rely on duplicate content for boosting sales which is a wrong practice that impacts the entire store. The dark side of duplicate content can be illustrated as:

  • It takes away your Search Engine Rankings. Since, Google, Yahoo, and Bing do not rank plagiarized content, you get penalized and your traffic from search engines decreases.
  • Duplicate content also impacts on-site search where wrong products start ranking higher, impacting a customer’s decision-making capacity. Brand interference is perhaps the biggest negative impact of duplicate content.

Identify and Remove Fake Sellers: Adhering to every return request ardently and sorting them by sellers or categories will help marketplaces identify sellers who are indulging in malpractices. Once a detailed list is prepared, marketplaces can either focus on removing these sellers or getting them in line by issuing warning letters. 

Marketplaces can also rely on misplaced attribute values to identify sellers who are in grave violation of guidelines and fine them for their mismanagement. When sellers are imposed with fines, they will start to function within the provided timelines. 

Seller Education: By offering sellers an opportunity to understand international guidelines and the consequences of not abiding by them, marketplaces can create a community of educated sellers. Online stores can also educate sellers about handling customer requests properly, packing products in a way that reduces damages and enhances the overall customer experience.

Sellers can also be educated to create a catalog that offers better product insight and helps with decision making. Such education enhances the overall customer experience and also provides sellers with more earning opportunities. 

Final Thoughts

With e-commerce set to take over 95% of all retail transactions by 2024, more and more people are betting their money on it. 

Investors are offering seed funding while retail customers are giving their hard-earned money for a better experience. Product return is one factor that affects everyone from customers to sellers to marketplaces to investors.

Depreciating brand reputation and increasing competition can coax marketplaces out of the market and make it tough for them to make a comeback. To fix increasing product return requests should be everyone’s priority and the quick fixes suggested in this blog will help a lot. 

About the author


Linda Taylor

Linda Taylor is an experienced business and marketing consultant with MattsenKumar LLC. Linda’s vast exposure in growing B2B SMEs and improving Customer Experience enables her to create quality content in form of Articles and Infographics. With a focus on benefiting the masses, Linda is creating content that adds value and routes companies towards success.