As the dust settles from Black Friday and Cyber Monday, retailers brace for a notable uptick in product returns. Research from Advanced Supply Chain (ASC) and ReBound Returns indicates that about one in three shoppers are likely to return their holiday purchases, with this surge peaking on “Returns Tuesday,” scheduled for December 10th this year. This trend has been shaped by the shopping behaviors witnessed in recent years, leading to what many in the industry anticipate as a challenging post-sale period for retailers.
In 2022, the volume of returns surged by 130% following the sales events, a number that steepened to a staggering 145% increase in 2023 compared to the previous year. This trend sheds light on a consumer mentality that not only capitalizes on discounts but often purchases with the intent to return items after they have been used, particularly during the festive season.
A YouGov survey, which questioned 2,000 consumers, revealed insightful statistics. Nearly one-third of respondents—29%—admitted that heavy discounts influenced their decisions to return items. Impulse buying also played a significant role, with 25% of participants citing it as a reason for returning products. The holiday season significantly exacerbates these return rates, particularly for clothing classified as ‘one-off wear.’
In fact, 28% of consumers purchasing items for special occasions—like festive parties—are inclined to return these purchases shortly after use. This includes specific seasonal attire, such as outfits for “Christmas Jumper Day,” with as many as 15% of these items destined for return. The study indicated that close to 40% of buyers of such ‘one-off-wear’ items expect to return clothing and accessories, while 19% revealed that they were motivated to return items after seeing unflattering pictures of themselves wearing the outfits.
Ben Balfour, the Managing Director at Advanced Supply Chain, shared crucial insights into consumer behavior. “Usually, it takes just a few minutes for shoppers to decide what products they’re sending back, followed by a short period to package and return the goods. It’s evident that the weekend following Black Friday and Cyber Monday will see a flurry of returns, with most items arriving at retailers around Returns Tuesday,” he noted.
Experts believe that the anticipated rise in returns this year will be even more pronounced, as consumers increasingly purchase items knowing they might send them back after wearing them. Jelle Schoenmaker from ReBound Returns remarked on this concerning trend. He urged retailers to re-evaluate their return policies, stating, “Retailers need to decide whether such returns should be fully refunded. Implementing returns grading protocols will empower brands with data to determine their future course of action. There remains an opportunity for retailers to refine their returns framework for the upcoming festive peak. Having the right insights can lead to fewer returns and enhance performance throughout the peak season and into 2025.”
Statistics from ASC highlight the hurdles retailers face with context on managing returns. A study conducted last year found that only 10% of retailers managed to resell most of the returned items through the original sales channels. The majority of returns—41%—end up being resold via discount outlets, while other items are either recycled (16%), donated (13%), or tragically disposed of due to irreparable damage (12%).
For retailers, the challenges posed by increased returns are multifaceted, involving not just loss of revenue but also logistical complexities and sustainability concerns. To successfully navigate this maze, businesses must proactively prepare for the returns landscape. Strategies that focus on enhancing product descriptions, improving sizing guides, and adopting technologies that facilitate smoother return processes can all contribute to minimizing the volume of returns.
Additionally, reevaluating the current return policies and incorporating customer feedback can help retailers strike a balance between maintaining customer satisfaction and protecting their bottom lines. As the holiday season approaches, understanding the psychology of consumers’ behaviors related to returns and ensuring effective logistics are two key areas where retailers can enhance their performance.
In conclusion, as Black Friday and Cyber Monday usher in a wave of sales, they also serve as a reminder of the looming return onslaught. Retailers equipped with the right strategies and insights can transform this challenge into an opportunity to refine their operations and build customer loyalty for the long term.