The truth is no one likes dealing with returns — not customers, not businesses. But with $743 billion worth of merchandise returned in 2023, it’s hard to deny that product returns are a major touchpoint in the customer journey. Finding a way to make them work for both your business and your customers should be at the top of your list in the new year.
Related: The power of product storytelling: Connecting customers to your brand
It helps to think of a return not as an end, but as a second chance to prove your value, earn your customers’ trust and drive future sales. In fact, according to 2018 Narvar survey, 96% of shoppers say a positive returns experience makes them more likely to shop with a retailer again. So, what does it take to turn the dreaded return into an opportunity? It starts with a thoughtful process that’s easy, transparent and above all, focused on the customer. Here’s how to do it:
Five steps to a customer-centric returns process
1. Build the right strategy for your business
Return policies aren’t one-size-fits-all. Every business is different, and your policy should align with your business’ needs and your customers’ expectations.
Think about what makes sense for your brand and your bottom line. For some businesses, free returns build loyalty and trust. For others, offering a flat return fee can make better financial sense. And the same goes with timing — while a 90-day return window might work for one retailer, a seasonal brand may need to tighten its policy. Do what’s best for your business.
The key is clarity. If return shipping is the customer’s responsibility, be clear about the costs upfront to avoid negative surprises. But whatever your approach, make sure your policy is easy to find, simple to understand and consistent across touchpoints. A confused customer is rarely a happy one.
2. Make the process simple and flexible
Ease is everything. Smaller businesses may not have access to advanced tools like self-service portals, but that doesn’t mean the returns process has to be complicated. A clear, step-by-step process will be key.
Paperless options are a great way to simplify the process. If possible, use digital tools to issue QR codes or downloadable return labels. Many platforms, like Shopify or PayPal, integrate with returns processes to streamline logistics.
It’s also a good idea to empower your customers with multiple return options. Whether it’s in-store returns, mail-in options or partner drop-off locations, flexibility makes the process more convenient. The easier the process, the more likely customers are to trust you — not just with this purchase, but with their next one.
3. Set a thoughtful refund policy
A clear and fair refund policy will play a key role in shaping how customers perceive your brand. While offering full refunds is often the go-to solution, it’s not always the only — or even the best — option for every situation. For smaller businesses, finding the right balance between customer satisfaction and operational sustainability is crucial.
Related: Keeping customers happy when fast shipping is unsustainable
When a full refund is costly or impractical, store credit can be a great alternative that keeps the customer relationship alive and encourages future purchases. Other times, partial refunds may strike the right balance. However, damaged or defective items are usually best resolved with a replacement, which minimizes delays and helps ensure your customers stay satisfied.
Just remember to be transparent and consistent.
4. Communicate clearly and proactively
Prioritize clear and regular communication with your customers. Nothing tests a customer’s loyalty more than being left in the dark about their return. Let them know from the start how quickly you’ll process their return and issue a refund.
It’s good to send confirmation emails when a return is initiated and great to provide updates at every step — from receipt to refund — to keep customers informed and reduce uncertainty. They’ll want to know when their return has been received and when they can expect their refund or store credit.
We’ve said it before and we’ll say it again: transparency builds trust, and trust keeps customers coming back.
5. Use returns as a learning opportunity
Returns are a goldmine for insights; they can tell you a lot about your customers and products. Are certain items returned more frequently than others? Consider updating your product descriptions or offering more detailed size guides. Do customers struggle with the returns process itself? Ask for feedback and refine accordingly.
Every return is a chance to learn. By analyzing your returns data and listening to customer feedback, you can improve not just your returns process, but your entire customer experience. And that kind of attention to detail doesn’t go unnoticed.
Turning returns into relationships
Returns will always be a part of the retail landscape, but they don’t have to be a headache. They are, however, a great opportunity to show your customers that you value their time and trust. When done right, a seamless returns process can turn a one-time shopper into a loyal advocate.
Here’s why it matters: customers who feel supported during a return are more likely to make future purchases. And loyal customers? They spend 67% more than new ones.
Related: How to turn a shipping mishap into a customer loyalty win
In the end, it’s not just about finding a frictionless way to accept product returns — it’s about creating relationships with your customers. A return may start as a disappointment, but it doesn’t have to end that way. What will you do with that second chance?
