According to Census Bureau estimates, ecommerce sales in the U.S. passed $263 billion in 2013, up almost 17 percent from the previous year.
As these numbers rise, ecommerce site owners are sprucing up every aspect of business to attract as many customers as possible. Most retailers already understand that product quality and marketing are important, but there are two other areas that have a significant impact on ecommerce sales: return policies and shipping.
A lenient return policy acts as a guarantee of product quality, leads to higher customer satisfaction, and ultimately, a higher customer lifetime value. These policies are also scrutinized by the savvy online customer - the 2014 UPS Pulse of the Online Shopper found 66 percent of all shoppers view the return policy before buying - so Internet retailers need to be as flexible as possible. Consider a return as an opportunity to win customer confidence and earn loyalty. Here are four ways to do so:
- Make sure the return policy is easily viewable during checkout.
- Include a return label in the box, or at least make it easy to print it from your site.
- Consider offering gift receipts (even online) for easy returns.
- Extend the return window around the holidays when more gifts are bought for others.
Some merchants will thing these policies are lenient, but consider that this year the European Union is adopting a law forcing online firms to offer a no-questions 14-day return window. Return policies are no longer privileges; they are rights. And no one upholds this belief better than in Zappos. Famous for their 365 return window, free return shipping and free shipping on all domestic orders with no minimum cost, it has become the gold standard of online shipping and return policies. As a fun add-on, if shoppers need a different size or color, the company will ship it to them for free - all they need to do is send back the first item in the next two weeks. Nordstrom has a similar perk.
Not everyone is in the position to offer such stellar service, but remember that a fair and honest return policy is more likely to instill confidence in buyers than any sale will.
A good or bad shipping process can seriously affect a brand's reputation. On Valentine's Day, 1-800-Flowers suffered an onslaught of posts and complaints on social media sites related to delayed shipping and missing packages. Although the company claimed delays were partially due to weather, the public response is enough to prove that when shipping goes wrong, customers are ruthless. Here are four ways to improve your shipping policies:
Fast tracking information:
Providing your customers with quick and easy access to tracking info will reduce customer service workload and make shoppers happier.
Detailed order statuses:
When statuses have more details - processing, on route, delivered - customers know the order is progressing and will have greater peace of mind.
Order status emails:
"Thank you for your order!" "You're order has shipped!" These emails are a low-effort way of giving customers a general timeline of the order. Plus, these emails have a very high open rate, letting retailers plug some other goodies or promotions while they're at it.
Offer free shipping:
This one hurts, but free shipping is more and more becoming a rule instead of an incentive in ecommerce. Four out of five consumers feel free shipping is an important factor when shopping online. Retailers should consider finding the average order amount on their sites and offering free shipping on everything $10 above that number, keeping everyone happy.
Avoid sticker shock:
Post shipping charges alongside the item prices to keep customers updated on the total cost and to prevent them from abandoning the cart when the price is too high. A smaller order is better than no order.
In shipping, the bigger, better deal isn't always the most desired deal. According to a study by Wharton marketing professor David Bell, a free shipping offer that saves a customer $6.99 is more appealing to many than a discount that cuts the purchase price by $10. In addition, a 2014 UPS study found 93 percent of shoppers would try to qualify for free shipping even if it is paying more than the shipping price. So when it comes to shipping, ignore logic and offer free shipping whenever you can.
Implementing better and more convenient shipping and return strategies will grow your customer base and therefore, your sales. Always remember, shoppers want complete transparency and honesty. So when in doubt, be sure your ecommerce site has a section dedicated to both policies that is easy to find and understand.