A recent study by Manhattan Associates highlights the growing importance of return policies in the retail sector, particularly as consumers navigate the pressures of a rising cost of living. As shopping habits evolve, retailers must recognize the vital role these policies play in driving sales and maintaining customer loyalty.

According to the research, 72% of consumers report being more likely to return items due to financial constraints, a trend that significantly alters purchasing behaviors. “Consumers are more selective than ever,” notes Raghav Sibal, Managing Director for Australia and New Zealand at Manhattan Associates. With this new caution, return policies have become a decisive factor in buying decisions. Over 69% of respondents stated that a store’s return policy impacts their choice to purchase, and 40% actively research these policies before checkout.

The study underlines the shift in consumer expectations regarding returns. While free returns have become standard, there is a notable inclination for customers to prefer easier in-store return processes, where 65% reported increased satisfaction. Retailers can leverage this by encouraging in-person returns and exploring options like ‘click and collect’ services, which can enhance the overall shopping experience.

Furthermore, a positive return experience can cultivate long-term loyalty—in fact, 91% of consumers indicated that a seamless returns process would make them more inclined to remain loyal to a retailer. Implementing robust returns management technology is essential to streamline this process, manage costs, and reinforce consumer relationships.

As retail competition intensifies, businesses that prioritize flexible return policies not only meet customer expectations but also differentiate themselves from others in the market. For retailers, the message is clear: optimizing return processes will be crucial in 2023 and beyond.