Returns in Swiss online retail – Online Retailer Survey 2022

The Lucerne University of Applied Sciences and Arts has conducted its first Online Retailer Survey 2022 on returns in Swiss e-commerce on behalf of Swiss Post. To find out consumers’ opinions too, questions on returns were also asked in the e-commerce trend indicator. This B2C study was carried out by the University of Applied Sciences in Business Administration Zurich in cooperation with Swiss Post. The results of both studies allow interesting conclusions to be drawn.

Eight out of 10 online retailers implement measures to avoid returns

Returns are a key element of online retail. The main reason for returns is failing to meet expectations of the item purchased online. This is confirmed by the results of the trend indicator: 9 out of 10 consumers indicate failure to meet expectations, such as size and quality, as the reason for returns. To reduce returns, online retailers are well advised to minimize the gap between expectations and the goods delivered. Supportive measures on avoiding returns in the product information are a good option. This could include detailed descriptions, additional photos of the items in use, customer reviews or a size selection guide. The Online Retailer Survey indicated that 8 out of 10 online retailers are already implementing measures in this area. But there is much more that can be done as online shops – which are digital contact points – provide great innovation potential going far beyond the paper catalogues of the past. The keywords are data, technology, personalization and artificial intelligence. 

Great potential lies in returns data

Returns data is the basis of effective measures for avoiding returns and ensuring efficient returns management. A third of online retailers say they continuously analyse returns data, while 21 percent do so only sporadically. Retailers that continually analyse returns use returns data much more frequently for the targeted identification of the reasons for returns, to define and implement measures to reduce the returns rate and for forecasting the returns rate.

According to the Online Retailer Survey, the returns rate stands at 7 percent on average and varies significantly depending on the business model and product category. The returns rate for online retailers focusing exclusively on B2C is twice as high for those with B2B business relationships (9% vs. 5%). For clothing and accessories, the returns rate is sometimes as high as 60% and stands at 20% on average. This is a reflection of the second most frequent reasons for returns. Just under 50% of consumers ordered several items to choose from, according to the trend indicator. This happens more frequently for clothing. Interactive size guides, but also specific information about models and sizes on images can be effective tools. In other product categories, such as household goods, DIY items or cosmetics, the returns rate is well below the 5 percent mark. In addition to net revenue minus returns, the returns rate is most frequently used for measuring the impact of returns measures – by over 4 out of 10 online retailers. Measuring the impact of returns measures closes the returns management circle and enables continuous improvement.

Improving customer satisfaction – reducing returns

In terms of returns management, improving customer satisfaction (60%) and reducing the returns volume (51%) are priorities for Swiss online retailers. The trend indicator reveals that the simplicity of the returns process (95%), the clarity of the returns conditions (92%) and quick refunds (83%) are the most important factors for consumers. This provides clear guidance for online retailers looking to improve customer satisfaction. Three-quarters of consumers also consider information on the status of returns to be important. The results of the Online Retailer Survey reveal there is still room for improvement when it comes to transparency: on the one hand, online retailers – at two-thirds – most frequently provide information about refunds. On the other hand, communication about the upstream steps in the returns process is much less common. Refunds taking a long time and customers not receiving information on the receipt of goods by online retailers can have a negative impact on customer satisfaction.

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