RETAIL ENVIRONMENT
Has online bubble burst as return to sender increase is on the horizon?
The bubble for increased online sales over Christmas may be about to burst as ASOS and Boohoo report profit warnings and a new report predicts that the value of online returns are forecast to increase to £5.6 billion over the next five years.
This equates to an increase of 27 per cent during that period, GlobalData said in its Online Returns in the UK 2018-2023 report.
The research found that the rise is mainly driven by returns of clothing and footwear.
The report emphasised that in order for retailers to successfully handle higher volumes and achieve better customer service, they must be prepared for the increase in online returns.
While clothing and footwear will account for the lion’s share of online returns, health and beauty, gardening, homeware, and DIY will also encounter a major increase in online returns as consumers gain confidence in buying online from these sectors.
“Clothing and footwear is the most returned sector, which is unsurprising due to the importance of fit – especially for online pure plays as customers do not have a chance to try items on or judge the quality of products,” GlobalData retail analyst Emily Salter said.
“Females account for the majority of clothing and footwear returners partly because they make up a higher proportion of online clothing and footwear shoppers, but also due to the numerous fits of female clothing.”
GlobalData’s report found the majority of clothing and footwear returns were due to issues in sizing or receiving incorrect items.
“The ease of returning items is important to consumers – 78.3 per cent of online shoppers agree that retailers need to improve the ease of repacking items for returns, and 53.3 per cent state that the hassle of returning goods puts them off shopping online,” Salter said.
“It is important that retailers offer a range of returns options, as although returns via post dominate, many consumers use alternative methods such as returns via a convenience store.
“Free returns are common across most sectors and consumers have come to expect this, with 72.9 per cent of online shoppers agreeing that they wouldn’t order from a retailer if they had to pay for returns.”
