Retail is in a period of upheaval. Not just since the ongoing COVID-19 pandemic, the shopping behavior of end-users is increasingly shifting to online stores. With the rising number of transactions, many retailers need to fundamentally review their Customer Experience – from the first click in the online store to return management. However, the latter is often virtually forgotten. Return management then becomes a problem for further business development and/or the Customer Experience.

Trend 1: Regulations as a showstopper for online trade

The second hard lockdown, which is becoming increasingly clear, may last until Easter, represents a worst-case scenario for many retailers. Although the volume in online trade increased significantly due to measures ordered by European governments in 2020, many retailers, who primarily conducted business in physical stores, were increasingly forced to adopt a dual strategy. Nevertheless, many retailers face closure despite the online channel. Price increases for the transport of goods by various parcel services contribute to the dismal situation of many retailers, along with fickle customers and lack of funds for marketing.

Many consumers, who previously had little contact with online trade and continued to support their local retailers, are also forced to turn to online shops. However, this group, in particular, expects a comparably comfortable treatment as they were accustomed to in physical retail.

As if all these challenges weren't enough: in December 2020, the Union faction of the Bundestag submitted a draft proposal that online retailers pay a special levy for each package. The response from associations was swift: they rightly fear that the end consumer would bear the brunt of this draft. The expected wave of bankruptcies in retail in 2021 will certainly be intensified.

Trend 2: Conversational commerce opens new channels to the customer

It's no secret: marketing measures in e-commerce are becoming increasingly automated, and the growth of mobile e-commerce is remarkable. More and more online stores are using bots via messaging services or social networks to generate customers – features like the "Buy" button on Facebook or the Instagram checkout are becoming increasingly popular with end-users. By the end of 2021, 73 percent of e-commerce sales are expected to take place on a mobile device (Statista, 2019). But not only the daily use of social media makes the Customer Experience as easy as never before: thanks to smart voice assistants like Apple's Siri or Amazon's Alexa, customers no longer even need to visit an online store to make purchases.

This trend generates more transaction volume, but also more returns. And here too, automated return management is ultimately indispensable. The British company ASOS, as so often before, was a pioneer in this area. They moved their process to an electronic level – away from the insert return. This step, which many German companies are still very hesitant to take, creates more touchpoints for direct communication with the customer and thus more transparency. In short: customer service is significantly strengthened. It creates not only added value for the retailer but also for the customer.

Trend 3: Sustainability gains relevance in E-Commerce

A bill passed in December for the duty of care of online retailers in dealing with returns follows the trend of sustainable consumption. According to Global Webindex, half of digital consumers stated in 2018 that environmental concerns influence their purchasing decisions. This also includes the handling of returns. Many online retailers still strictly adhere to the legally regulated two-week right of withdrawal. Only in exceptional cases are longer deadlines granted – the Corona crisis is one of them. Since the outbreak of the pandemic, more and more retailers are handling the right of withdrawal more leniently.

The improved communication between customers and retailers, which return management platforms offer, can even avoid returns – a win for retailers and the environment. Based on customer dialogue, logistic processes can be optimized and made more sustainable. This, in turn, makes an online store more attractive to new target groups.

In summary, in 2021 many established processes in e-commerce and the associated IT will be put to the test. Special attention will be paid to the area of returns, as they are not only a significant cost factor for retailers but also a disruptive factor for a positive Customer Experience and a challenge in terms of sustainability.