As retailers prepare for a bustling holiday returns season, Optoro, Inc. announces the results of its new “2024 Returns Unwrapped” report. This year, the company predicts $160B in holiday returns.
According to the National Retail Federation, the volume of returns increased from $613.94 billion in returned merchandise in 2022 to $743 billion in 2023. According to Optoro’s new study, 46% of shoppers make returns multiple times a month — a 29% rise from 2023. With returns now a routine part of the shopping journey, Optoro has identified four key trends influencing shopper preferences and retailer priorities.
“As returns have become an integral part of the shopper experience, retailers must balance meeting sky-high expectations with rising costs, environmental impact, and fraudulent behaviors,” says Amena Ali, CEO of Optoro. “By understanding shoppers’ behaviors and preferences around returns, retailers can create returns experiences that embrace their needs while driving deeper loyalty and protecting their bottom line.”
Key Takeaways:
- 54% of retailers are looking for ways to increase the financial recovery from returns
- The cost to return a purchase averages 27% of the purchase price, which erases as much as 50% of the sales margin.
- To offset costs and discourage returns, 63% of retailers currently charge a shipping or restocking fee. Of those that do not have a fee in place, 55% are considering implementing one.
- 81% of retailers claim to have a returns abuse mitigation strategy, with bracketing (38%) and wardrobing (35%) as their biggest concerns.
- Retailers are most likely to consider banning customers with a history of wardrobing (38%) and bracketing (34%).
- 86% of retailers state that their companies have meaningful strategies in place to minimize the environmental impact of returns. These strategies include:
- Offering shoppers the ability to make boxless, label-less returns in-store or at third-party locations (56%);
- Diverting like-new goods to internal or external recommerce channels (54%);
- Consolidated shipping for returns (50%).
