A return policy might sound like an insignificant document hidden away in your online store’s footer, but it’s actually a crucial aspect that can make or break an online store. In this blog post, we will explore why a return policy is so important and how it can impact the success of an online store.
What is a return policy?
A return policy is a set of guidelines that describes the process by which customers can return or exchange items they have purchased. The policy typically includes information on how to initiate a return, the time frame in which returns are accepted, any associated costs, and any conditions that must be met for a return to be accepted.
Why does my online store need a return policy?
Well, you have to, since it’s required by the law. And also your online store will be more trustworthy with a return policy–you see, when ordering online, you only see photos and description of the item. In real life, it might feel a bit different. Or when ordering clothes, they just might not fit. The return policy will give your customers a sense of confidence: if the clothes don’t fit, I can just return them.
In the European Union, you can return a product in 14 days after receiving it, this is mandatory and required by the law. You can always offer a longer return period (perhaps 30 days). IKEA is probably the most generous one–you can return unopened products within a whopping 365 days (yes, that’s one year) or opened products within 180 days. That is impressive!
The benefits of a (good) return policy
A return policy can significantly impact customer satisfaction. Customers want to feel confident in their purchases, and a clear, easy-to-understand return policy can provide them with that confidence. A good return policy can reassure customers that they will be able to return or exchange an item if it does not meet their expectations. In contrast, a poor or non-existent return policy can make customers feel uneasy about making a purchase, leading them to abandon their cart or look elsewhere.
Secondly, a return policy can impact the reputation of your online store. Customers are quick to share their experiences online, both positive and negative. If a store has a poor return policy or mishandles returns, it can lead to negative reviews and damage the store’s reputation. At the same time, a store with a clear, fair, and easy-to-follow return policy can attract positive reviews and repeat customers.
Thirdly, a return policy can impact the bottom line of your online store. Simply put–if you don’t have a return policy or too complex to easily understand, your potential customers will take their money to some other store and you’ll lose sales.
So, what makes a good return policy?
A good return policy should be clear, easy to understand, and fair to both the customer and the store. It should provide customers with clear instructions on how to return or exchange an item, including any associated costs or deadlines. The policy should also provide the store with protection against fraudulent returns or abuse.
The average ecommerce return rate is around 20-30%. For large online retailers, this means hundreds or more returns in each week. In this case you should look into automation and smart solutions to reduce all the manual tasks like communication, bank transfers and so on. If you are looking for a more automated way of refunding money to your customers, check out Montonio Refunds.
To sum up, a return policy is a crucial aspect of any successful online store. A well-designed and executed policy can increase customer satisfaction, improve the reputation of the store, and increase sales. On the flip side, a poorly designed or executed policy can lead to negative reviews, lost sales, and damage to the store’s reputation. As ecommerce continues to grow, it is essential that online stores prioritise their return policy and ensure that it is fair, transparent, and easy-to-follow.