Retailers are starting to prepare for the upcoming holiday season, and the potential effects of the COVID-19 pandemic are top of mind. One challenge of the typical holiday season is the associated product returns. But this year will be anything but typical, and the rise of ecommerce we have seen from the pandemic so far means retailers are likely to see returns surge as well. To help retailers prepare for holiday returns during COVID-19, David Sisco, UPS Director, Global E-Commerce Strategy, and Ken Lim, Optoro’s own SVP of Client Development, explored solutions in our latest webinar.
In case anyone missed the webinar, we’ve summarized the key discussion topics below:
Forbes reported that online retail spending in May hit $82.5 billion. But what does this mean for returns? As online spending grows this year, we may see a spike in ecommerce returns as well. And with the average ecommerce return rate reaching up to 30%, retailers could be looking at unprecedented returns numbers during peak season.
When it comes to returns, consumers are looking for convenience – whether that’s through contactless drop offs, or packageless drop offs at locations like The UPS Store. With a possible second wave of COVID-19 shutdowns this fall, retailers should use this time to ensure their returns processes are optimized and provide the best customer experience.
The Changing Retail Landscape
Stores: What happens if stores close as the pandemic resurges or stores are still experiencing partial disruptions? In previous research, we found that up to two-thirds of consumers prefer to return items in-store, and our most recent data report found that almost half of consumers will not feel safe being in a store as a result of COVID-19. Looking at the holiday season, retailers should expect a large volume of mail-in holiday returns. This opens up an opportunity for retailers to upgrade their returns experiences and possibly generate stronger customer loyalty.
Supply Chain Disruptions: The physical handling of returned items coming into stores or through the mail and the treatment of unsold inventory will likely put a strain on fulfillment center capacity, as we saw in the first wave of COVID-19 this spring. Combined with the surges of returns typically associated with the holiday season, it’s now more important than ever for retailers to streamline their returns processing with the right technology that will help make profitable decisions.
Inventory Management: Strong recommerce strategies that utilize multiple channels for resale are key right now. Retailers will want to make sure that they’re using a diversified recommerce strategy that includes both physical liquidation channels and online resale channels to manage their returns stock. In the event of physical store closures, having an online channel in the mix will be beneficial.
For more insights on holiday returns during COVID-19, watch the full webinar recording below and follow us on YouTube.