5 Ways to Reduce Your eCommerce Return Rate

Managing returns is one of the biggest challenges facing eCommerce businesses today. Not only do returns erode profitability, but they also create logistical complexities and potentially strain customer relationships. With the average return rate for eCommerce often hovering between 15-25%, effectively managing and reducing this rate is critical. 

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In this article, we’ll explore five strategies for minimizing eCommerce returns, helping brands calculate return rates accurately, and taking proactive steps to prevent returns from occurring in the first place.

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1. Provide Transparent and Accurate Product Information

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A leading cause of eCommerce returns is the mismatch between customer expectations and the actual product received. If customers feel the product they receive is not as described, they’re far more likely to initiate a return. To combat this, ensure that your product descriptions are detailed, accurate, and transparent. Include dimensions, material details, and high-resolution photos from multiple angles. Videos or interactive product tours can also help buyers gain a clearer understanding of the product before purchasing. Transparency is key; being upfront about product capabilities and limitations significantly lowers the return rate.

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2. Leverage Conjura to Understand Return Trends

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To truly get a grip on your eCommerce returns, you need detailed visibility into exactly where and why they're occurring. Conjura offers omnichannel analytics, uniting your eCommerce, marketing, and customer data into one intuitive platform. By connecting your store, marketplaces, marketing channels, and Google Analytics seamlessly, Conjura delivers precise, actionable insights into your return rates broken down by SKU, sales channel, and customer segment.

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With Conjura's robust SKU-level analytics, you can pinpoint exactly which products or categories have consistently high return rates. This granularity helps you quickly determine the root cause: Is it an issue with product quality, inaccurate sizing, poor imagery, or misleading product descriptions?

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Beyond identifying problematic products, Conjura offers deeper insights into customer behavior, such as how often high-return items are purchased together or the specific channels driving these returns. This helps you refine not only your product offerings but also your marketing strategies and merchandising tactics.

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If you want to go one step further, attributing ad spend at the SKU level enriches your analysis even more. This feature lets you connect marketing costs directly to returns, highlighting if certain marketing strategies or campaigns are contributing disproportionately to high return rates.

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Finally, returns don’t always mean a loss in profit. By understanding your SKU’s true profitability, you can factor in the cost of returns and understand if that product is still profitable, regardless of returns. This way, you’ll be glad that you didn’t pull that product from your offering!

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Book your demo of Conjura here.

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3. Use a Specialized Solution like Loop Returns

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Sometimes, returns are unavoidable. In these cases, your goal shifts to making the return process as efficient and customer-friendly as possible. Solutions like Loop Returns help businesses streamline and simplify the returns process, providing shoppers with a seamless and positive experience, even when returning products.

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Loop Returns encourages exchanges over refunds through personalized recommendations and instant exchanges, ultimately reducing the financial impact of returns. Their intuitive dashboard allows you to manage returns effectively, track trends, and identify patterns. By turning returns into exchanges, Loop Returns helps protect revenue while improving customer satisfaction and retention.

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4. Enable Order Edits Post-Purchase

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Another effective way to reduce returns is by allowing customers to modify their orders after the initial purchase. Solutions such as Order Editing provide customers with the flexibility to make changes or correct mistakes before the item is shipped, significantly reducing the likelihood of a return.

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Imagine a customer accidentally choosing the wrong size or color but realizing the error shortly after placing their order. If they can correct the order immediately, you’ve avoided a potential return. By incorporating an app like Order Editing, you proactively prevent returns by empowering customers to ensure their purchase matches their exact needs and preferences.

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5. Anticipate and Mitigate Returns with Conjura’s Predictive Insights

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The most advanced strategy for reducing eCommerce return rates involves predictive analytics. Conjura leverages advanced algorithms and predictive models to identify return trends early, often before they significantly impact your bottom line. By examining factors like product category, customer buying patterns, and past return behavior, Conjura provides actionable insights to preemptively mitigate returns.

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For example, if Conjura’s analytics show a spike in returns from a particular product or category following a promotional campaign, you can quickly dive into why this is happening. Is there a mismatch between marketing messages and product realities? Did promotional messaging set unrealistic customer expectations? With Conjura, you’ll have the data-driven insights needed to proactively adjust your strategy, whether by updating product details, revising promotional content, or offering targeted guidance to customers.

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How to Calculate Your Average Return Rate

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Knowing your average return rate is essential to effectively manage your eCommerce operations. To calculate your average return rate, you'll need to divide the total number of returned items by the total number of units sold within a given time period, and then multiply the result by 100 to get a percentage. The formula looks like this:

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For example, if you sold 1,000 items and 100 were returned, your return rate would be 10%.

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By regularly tracking your average return rate with a powerful analytics tool like Conjura, you can quickly identify trends, set benchmarks, and take targeted actions. Conjura’s dashboards allow you to drill down even further, providing return rates segmented by SKU, channel, or customer group, helping you pinpoint specific areas of concern and opportunities for improvement.

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The low-down on lowering your return rate

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Reducing the eCommerce return rate requires a multifaceted approach, combining transparency, customer empowerment, and advanced analytics. While returns will always be part of online shopping, employing these strategies can significantly minimize their frequency and financial impact. Leveraging powerful tools like Loop Returns and Order Editing provides immediate, customer-friendly solutions, while Conjura’s detailed insights and predictive analytics position your business to proactively manage and reduce returns. Taking control of your return rate not only improves profitability but also enhances customer satisfaction and loyalty - creating a stronger, healthier eCommerce business…a win win!

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