Its true that returns are expensive, as they tax the retailer’s resources and lead to lower profit margins in the short term. However, retailers need to understand the importance of efficient returns-handling in building customer trust and enhancing lifetime values. They should know that when a customer isnt happy with a product and returns it, they have to act quickly and efficiently to process the return. Efficient returns play a key role in managing the inventory efficiently – balancing forecasts and return rates within the inventory levels serves well to prevent overstocks and backorders – ensuring that the customer will come back for more. Here are some tips to streamline your ‘Return’ policy.
- Communicate with customers about the return processing through information on pages, on receipts, or within a packaged delivery product.
- Keep the process and terms simple. Placing a code on return labels expedites return process when multiple systems are involved.
- Identify reasons for returns. Data collected should be used to calculate costs of returns which in turn aids the action plans.
- Return processes should be quick as customers would be low on patience. They are more likely to shop with the same retail merchant again if the return process is convenient.
- Cross channel returns enable flexibility and variety on the shopper’s part, giving more reasons for the customer to purchase another product from the same retailer.
- Smart returns – for e.g. Innovations like bar-coded labels, which can be sent online – also would help to make the customers more comfortable and assured of the return confirmation.
- The merchant or manufacturer or a third party fulfillment service provider can be sources to handle customer returns, thereby increasing the number of options for the customer to easily return the product
Replacement or acquiring a new order management system is a daunting task – how do you resolve and arrive at a decision. System project teams within a retail company are the best option to arrive and there is no limitation on the time frames which can vary depending on the complexity of the requirement. However when it comes to evaluating potential solutions, there are some standard steps which a marketer and retailer can follow:
System objectives and priorities
Managing increased capacity, improving customer service online and offline, business methods like continuity shipping, processing costs to be lowered, inventory efficiency are some of the reasons for acquiring a new order management system. It’s always important to prioritize the goals well before choice of the alternatives so that the processing is made easier.
Operations and budgets
As retailers and marketers need to spell out how the order management system should serve business requirements in a formal and comprehensive functional method.
RFP to provide analysis
Besides the results of the functional needs, the RFP should also provide: requests to vendors to indicate if they can meet your requirement, length of time it would take and also support from out of the box functions. Listing of all your hardware, networks, and explanation of how your retail business works, if there are any third party processors are all equally important to be included in the RFP list. Read more
Gift certificates are a thing of the past. Though they act in the same way as gift cards, the benefits of changing from a paper system to a card system is astounding.
One major reason being that a card is smaller and more transportable. It can conveniently fit into a wallet credit card slot. That might not seem like much because paper can fold up into a smaller size, but in the days where receipts and notes are thrown around into purses or wallets, those certificates have a greater chance of being forgettable or even unintentionally disposable. Because gift cards are about the same weight and proportions of a credit card you are constantly reminded of them every time you reach for your plastic.
Another reason why cards are more beneficial is because they are capable of being “reloadable.” This means that once the funds on the card are depleted, the user can “reload” more money back into it. In a sense, it acts like a debit card exclusive for that retailer or set of retailers, so that it only uses the amount available on the card’s account but allows you to put more funds into it as you please.
Most of the retailers only target gift services during special seasons like the holiday season or back-to-school season, and for occasions like Valentine’s Day or the Fourth of July. Retailers try to make most of their sales during these periods and their marketing strategies are targeted as such. Sometimes they do not offer gift services during the regular shopping time period to cut down costs.
However, an equal number of retailers offer both – gifts during season and non-seasonal times. As a retailer you need to decide whether your products have the flexibility to offer gift services.
Loyal shoppers and new customers should be placed on a customer relationship platform that drives genuine satisfaction and loyalty for effective gift services. This injects brand and product exposure with equal measure. Some of the standard suggestions to consider are:
- Smart engagement strategies should be exercised by marketers when awarding gift services to high-value long-term customers and low-potential shoppers. Existing loyal customers should be rewarded to attain a higher percentage from them. Low-potential shoppers should be based on number of items or total cost which ever is higher and rewarded accordingly.
- Promise what you can deliver. With the increasing number of retailers offering types of gift services, marketers should view customers as highly influential, individual brand ambassadors, in which their word-of-mouth increases your market share. For this you should ensure that the services your site promises to deliver are accurate and rewarding. This leaves customers satisfied and increases the likelihood they will come back for more or send referrals to friends and family.
There are several factors which govern the success or failure of any loyalty program and retailers are always trying their best to ensure the marketing strategies do not include them. Sometimes not having an accurate target will translate to not gaining true customers. This might result in defecting patterns in the customer lifecycle and so to overcome this, you need to make sure that the loyalty programs are affordable, multi-usable across different brand outlets of the same retailer and give unique benefits like free shipping.
Some common strategies are:
• Rewards every time. Continuous reinforcement strategies work to create loyalty programs that rewards customers every time they make a purchase, like free shipping or low prices every day, once a week or any another time-bound date.
• Fixed and variable rewards. Sometimes retailers reward customers who have shopped more than 5 times during the same week, or month. A different way of approaching this is that customers get an option to win either of the above options, which is similar to a lottery.
• Interval rewards. Retailers sometimes reward customers who shop during the first week of a month. Another way is deploying a rewards system for a certain time period either for the week or month to keep customers shopping and guessing at whether or not they will reap a reward for their purchase. Unexpected rewards are the most memorable.