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 RETURNS.  FOR RETAILERS, THIS just isn’t a nice word!  But it is an increasingly important one, invariably rated a top consideration on customers’ lists of consumer services they most value. A common statement from buyers is, “If I can’t return it, I won’t buy there.” 

   — But believe it — there is more to it then just being able to make a return. The big questions include “For how long after purchase can the customer bring the product back?”  And, “What documentation will the customer need?” 

Retailer policies on products that customers bring back to the store are always in a state of flux.  Senior “Editor Tod Marks of Consumer Reports calls them “a moving target,” advising customers to always read the fine print.  

Apparently, Americans expect to spend at least one hour waiting in lines to return holiday purchases this year.  And, according to Consumer Reports, almost 20% say they expect to return at least one gift.  That adds up to a lot of returns, and refers only to those returns that might be called “legitimate”!

CHANCES ARE YOU’LL HAVE FAR FEWER RETURNS IF YOU OFFER TOP QUALITY PRODUCTS AND GIVE GOOD GIFTING ADVICE TO YOUR CUSTOMERS.  (HELPING RETAILERS UNDERSTAND THE IMPORTANCE OF GOOD RETURN POLICIES DOESN’T HURT, EITHER!)  CHECK HERE FOR TOP VALUE ACCESSORIES:

 

 

                                                 Fraud Protection

BEYOND THAT, THE National Retail Federation reports that the retail industry will lose about $3.68 billion this year in return fraud, up $2.7 billion from last year.    To try dealing with this, 10% of retailers report that they have tightened holiday return policies. Only 5% said they were loosening them up.

Which, you might ask, means what?  Well, Macy’s has gone the lenient route, removing time restrictions on when most items can be returned with a receipt.  Kohl’s promotions include the promise:  You can return any item, anytime, for a full refund without restriction. Such easy returns don’t bode well for small retailers, as they give the big boys added sales power that is hard to compete with.

Most large stores have different return policies for different product categories.  Target has a 90 day return policy on most products, with a receipt required unless purchased by credit card, debit card, gift card, or check.  Many prepackaged products can’t be returned at all if opened unless defective.  For electronics, there is a 15% restocking fee.

Sears has a 90 day return policy, but only 30 days on jewelry and watches.  A receipt or e-mail confirmation and original packaging is required. 

If you are going to try competing head-on with any of these major stores, you’d better have a return policy relatively lenient or you’ll be in trouble.  Admittedly, consumers generally do not expect smaller retailers to offer the same customer-friendly terms as big stores, but they still do expect eased service restrictions, especially during the present economic turn-down.

Some stores require approval by the manager for returns. Others will only refund online purchases with a merchandise credit. Understanding what your competition is doing about returns helps you write a store policy that is as lenient as necessary for your own protection.

 

                                          Marketing Strategy

V. RUMAR, A PROFESSOR at the J. Mark Robinson College of Business at Georgia State University has found that if consumers know they can return an item more easily, it will make them more likely to go to that store to buy.  They will also be more likely to refer friends and family to the store.
Rumar adds that lenient return policies “communicate and build trust in the minds of consumers through the assurance of either cash back/store credit if the product has to be returned.”  He contends that return policies can be used as a strategy to bring in future sales.

Obviously, good customer service is becoming increasingly important for shoppers.  Sales and deals are still seen as the most important consideration for buying, but that number is surprisingly on the decline.  It has dropped from 43.3 percent last year to 41.8 percent this year.

On the other hand, customer service as the most important consideration rose to the highest percentage since 2002!  Retail analyst Patricia Edwards says that while people are still value-conscious, “the shopping experience is becoming a bigger consideration now.”

TOP OFF A GOOD SHOPPING EXPERIENCE WITH GOOD PRODUCT VALUES.  LOOK HERE FOR PRIME EXAMPLES OF WHAT THAT MEANS:

 

 

Big box stores compete with return policies to lure customers, but small business can go broke by trying to play the game.

Comments (0) Posted by Mary McGarry on Friday, January 7th, 2011


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