FedEx Makes Returns Easier For Customers

FedEx will offer customers an easier returns process, featuring wider access to a network of locations for dropping off unwanted goods using a simple QR code.

While FedExFDX
has worked with many mass retailers on this solution in the past, it now offers hassle-free returns for small to midsize businesses. “Customers will buy five items and return one, but when they package the one item, they use the same box the five items were originally shipped in,” explains Ryan Kelly, vice president of e-commerce and alliance marketing at FedEx. “This creates a higher shipping cost and is not as environmentally friendly as shipping the one item back in a smaller package or as part of a consolidated return.”

Consolidated returns on the rise

Retailers have found that consolidating returns can increase efficiency and reduce costs by using fewer supplies and less labor to pack and ship the products. Ground transportation’s consolidation process also generates fewer carbon emissions and leaves a smaller environmental footprint than shipping individual items back to retailers.

Customers are advantaged with a simplified return process. Shoppers are increasingly making buying decisions based on a retailer’s return policy, expecting returns to be free and easy. “Customers can bring in an item to one of the 2,000 FedEx return facilities without a box or without having to pack up the return. Just the product and a QR code from the retailer will be scanned when they return their item,” Kelly stated. Retailers that offer this service have an agreement with FedEx to accept box-free returns.

Retailers look to reduce returns

“Returns need to be managed before they happen, not after. AI/machine learning at the right point in the shopping journey can better the experience for the consumer and help retailers manage returns costs,” advocated Michele Marvin, vice president of marketing for Appriss Retail. There are enabling technologies to help shoppers make the right choices when buying online. The most prevalent reasons for returning products pertain to apparel: incorrect size, bad fit, or issues with color. These three reasons combined account for 55% of returns.

“Technology, in general, can help if consumers use it and retailers offer the right tools to aid in product selection,” said Marvin. Retailers can offer fit technologies, provide better product descriptions through QR codes or videos, or use augmented reality to show products virtually. For example, showing how a vase looks in the living room before the consumer buys it or how a product looks on a customer avatar can reduce returns, making retailers more profitable and happier.

Marvin cautions retailers that when developing return policies, which have been shifting this year, they should review returns holistically, and the customers’ lifetime value should be considered. Suppose retailers create rigid and costly policies for the customer or make returns a difficult process. In that case, it will impact the shopper experience and create unhappy customers, leading to higher complaints and eventually motivating customers to shop elsewhere.

Returns remain flat compared to 2021

Consumers are expected to return more than $816 billion worth of retail merchandise purchased in 2022, according to a report released by the National Retail Federation (NRF) and Appriss Retail. As retail sales continue to grow, the average rate of return has remained nearly flat at 16.5% compared with 16.6% in 2021. “While often returns represent a lost sale for a retail establishment, returns can also provide recourse through positive customer engagement and, potentially, another purchase,” stated Mark Mathews, NRF’s vice president of research, development and industry analysis.