Retailers Slammed With 1.5 Million Pre-Christmas Return Packages. In One Day

Easy return policies have boosted consumer confidence in ecommerce and helped make it the dominant force in shopping.

The questions are at what point free returns become such an economic burden that merchants are forced to begin charging. And the corollary is, at what point consumers will assume the charge on their credit cards without complaint as a cost of doing business? JL


Rachel Premack reports in Business Insider:

1.5 million packages were returned on Wednesday, which would make it the peak returns day this holiday season. It was the first time "National Returns Day" fell before Christmas. $94 billion worth of goods are expected to be returned this holiday season. 79% of consumers check return policies before buying products. 44% of US shoppers returned an item purchased online and most shipped the item back. Retailers simplified the returns process and therefore boosted people's confidence in buying online. "An easy return policy makes return customers for retailers."
UPS estimated that 1.5 million packages were returned on Wednesday, which would make it the peak returns day this holiday season. UPS said it was the first time that "National Returns Day" fell before Christmas, rather than in early January after the holidays. It said it expected a second wave of returns, of 1.3 million parcels, on January 3.
"These returns are included in the 800 million packages UPS anticipates delivering this holiday season," UPS said in a press release.
Those returns largely come from purchases made before Black Friday and, to a lesser extent, an earlier Hanukkah. They're also from people who bought a gift for Christmas, weighed their choice, and then decided they didn't want to give it after all, Kathleen Marran, UPS's vice president of US marketing, told Business Insider.
A study published last year found that most online shoppers said returns were the worst part of buying online. But it's clear that as retailers have increasingly made returns easier — and often free — customers are getting more comfortable with buying things online, testing them, then returning them.
An April report from UPS found that 44% of US shoppers had returned an item purchased online and that most shipped the item back to the retailer.
Perhaps the more reasonable choice for people who don't want to deal with returning a product online would be to go to a physical retail location to see it, particularly during the time crunch of the holidays. But Marran said many retailers had hugely simplified the returns process and therefore boosted people's confidence in buying online.
About $94 billion worth of goods are expected to be returned this holiday season, according to Optoro, a firm that helps retailers optimize their returns. And while many retailers can resell or repurpose most returned goods, Marran said, they still have to cover the costs of transporting and sorting them, causing many to hone in on "reverse-logistics-management programs."
But even though it's pricey for retailers, the returns process is key to attracting and retaining online shoppers — Optoro has found that 79% of consumers check return policies before buying products.
"An easy return policy makes return customers for those retailers," Marran said.