Free Return Shipping Can Offer Quite a Few Returns on the Investment

Jan 6 2014

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As e-commerce continues to grow, several consumer shopping patterns have emerged.  Some of them are very straightforward (such as using search engines to hunt for the best deals), while others are a bit more elusive (for example, the high frequency of abandoned shopping carts).

One consumer expectation that may contribute to abandoned carts and negatively affect sales, during the holiday season and beyond, is free returns.  More than ever, consumers are scrutinizing the return policies of online retailers.  In fact, a comScore study found that 67% of shoppers review the store’s policy before they make a purchase; it’s probably not a coincidence that the same percentage of shoppers said they’d buy more if they knew returns were free.

freeshippingbenefits_newclothesConsumers’ preference for a customer-friendly return policy and free return shipping is a natural reaction to the e-commerce environment.  Despite the huge improvements in the way products are displayed, online shoppers often don’t feel they can be sure of what they’re buying until it’s physically in their homes and hands (or on their feet).

As online sales have increased, however, so have return rates, particularly in the clothing sector.  As The Wall Street Journal recently reported, consumers are now using their living rooms as dressing rooms, trying on various outfits that they’ve purchased online and returning those that don’t fit or don’t appeal to their fashion senses.  The fashion industry has led the charge in terms of lenient return policies, but the recent rise in return rates has many of them rethinking their approaches to fickle shoppers and high-frequency return shippers.  Among the tactics being tested to decrease returns are data-mining aimed at identifying and addressing “chronic” returners; purchase-point and post-purchase communications, in part to promote informed size selections; coupons that steer certain prospects toward items with low return rates; and even “appeasement” discounts designed to persuade consumers to follow through on their purchase decisions.

Although retailers might think that the easiest, least expensive return policy would be to simply let customers fend for themselves, that approach would be short-sighted — offering a generous return policy combined with free return shipping can significantly improve sales.  Our flagship program, FreeShipping.com, gives retailers an easy and affordable way to offer customers free return shipping, in addition to a whole host of other customer-pleasing, revenue-generating benefits.

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Research done by Forrester Consulting shows that a hassle-free return policy that includes free return shipping drives sales:

  • Over 80% of consumers are more likely to shop with online retailers that offer an easy return process.
  • Over 80% of consumers feel greater loyalty to retailers that offer generous return policies, including free return shipping and/or no-questions-asked returns.
  • Over 80% of consumers say they’d make a purchase if they knew they could return an item to a brick-and-mortar store or get free return shipping.
  • Perhaps most importantly, a free return-shipping program increases conversion rates.

freeshippingbenefits_mobileIt’s easy to see why a return-shipping policy that favors shoppers would also pay off for retailers.  According to the Forrester Consulting study, consumers spend more than $7 and 30 minutes to return an online purchase, which is why they rate the difficulty of returning purchases the second-biggest problem associated with online shopping.  A customer-friendly return policy allows them to focus on their actual purchase decisions, especially when they’re aware of the policy ahead of time.


An easy return policy is also an implicit product guarantee the retailer makes to its customers; a statement of confidence that the retailer’s products will meet its customers’ needs and expectations.  As a result, it enhances the retailer’s brand and creates goodwill.

As the competition for online shoppers continues to grow, meeting the needs of those shoppers will be key to success.  Retailers that make online shopping easier and more convenient will win in the end, as they’ll boost shopper confidence and modify the traditional touch-and-feel purchase behavior that many consumers currently embrace.  A hassle-free return policy combined with free return shipping helps e-tailers meet customer expectations and increase revenue at the same time.