How your returns strategy ruins your money

26th Sep 2022
3 minutes, 47 seconds
About 530 million parcels with 1.3 billion items customers have returned to retailers in Germany in 2021, according to a study by the University of Bamberg (1). This huge amount exceeded even the most pessimistic forecasts. The associated costs keep rising, also due to growing expenses for the transport of goods.

The stress to avoid returns or reduce associated costs provokes a collateral damage in the process to the customer. After all, return shipping is part of the customer experience. Eighty per cent of the shopping customers stated in a returns study (2) that a bad return experience was a decisive reason for avoiding the supplier for the next time.

Customer experience ends with the purchase, or maybe not?

The common misconception is to think the customer experience ends with the purchase. Therefore, the wrong conclusion is that returns always mean credit. For this reason, strategies for cost-reduction mostly will try to avoid returns.

However, the fact is that the customer perceives a holistic returns management as a service benefit. The related communication with the customer contains great potential for generating sales. A return along the needs of the customer helps to improve the customer journey as a whole.

My customer, the unknown person

Holistic returns management that focuses on the customer during his return process also increases revenues by customer reliability. Companies that recognize this are facing a wide operational problem. To be specific, they simply do not know about the exact situation and wishes of customers due to a lack of data.

One reason for this situation still is the widely used paper-based returns form. How can you use those paper-based data quickly and in an automated way for digital processing? However, if you can understand in advance, why the customer intends to return the goods, you can act providently. The returns form itself will not be able to solve the customer's problem in a satisfying way.

Further media discontinuities fail to establish of a positive customer experience during the return process. Whenever not all processes are digitalized, you will miss reliable insights.

Realize your wishes in real time

Excel at a positive customer experience with real-time information about the customer. An entire digital return strategy provides comprehensive insights into problems with deliveries, products and customers' requests and wishes.

Digitize your entire process chain and get to know your customers in their individual situation. Involve all relevant departments from marketing & sales to logistics & customer service and use data from all internal and external sources.

This enables you as a retailer to organize the return as a service for the customer. Close the time gap and benefit from the advantage.

Holistic returns management is much more than a fancy user interface for customers and customer service. The way to label download mostly does not lead via a global returns management system considering all optimization aspects. You often just find a simple returns portal (user interface for label download). This means that retailers do not gain any insights from the returns in order to optimize products, online presence and customer service.

A comprehensive returns management escorts the entire customer experience. It evaluates the customer across his behavior and interactions. This global view is the grounding for person-specific decisions in real time.

Always benefit from customer satisfaction

The actual problems with the individual customer can be manifold. For instance, the product is not pleasing, it is defective, has broken during delivery, or simply has a slight defect. Furthermore, an address error on the part of the retailer or supplier can occur and might cancel the delivery without involving the customer.

As a retailer, you now have versatile ways to react to the customer's needs. You can offer alternatives to a return so that a rebound may not even occur.

You can offer the customer a discount or send a voucher via the platform and thereby create an incentive to keep the item. For technical products, you can share support videos to solve the problem directly.

If the customer still decides to return the item, the platform guarantees the best possible experience by considering their wishes.

Replacing the paper form by a digital feedback will not lead automatically to more returns. In case of repeated returns, you can charge fees and announce it to the customer in advance.

Customer Lifetime Value

The key to the right strategy for customer experience is to look at the entire customer journey. A return management based on real-time information provides the missing link for your strategy. The complete real-time overview from outbound through all services to rebound allows companies to provide alternatives to customer returns. Finally, you will benefit from larger shopping baskets, more recurring customers and more turnover.


(1) Forschungsgruppe Retourenmanagement, Universität Bamberg, 2022,

(2) Jörs / Mostaan (2020): Umfrage zu Retourenservice / Retourenmotivation, In: bevh-Retourenkompendium,

Bild: Andrii Zastrozhnov/