Ask a retailer what keeps them up at night when they think of the month of January, and there’s a good chance the answer will be “returns.” Since Thanksgiving and Black Friday, merchandise has been flowing out of the stores full tilt, into the hands of eager gift-givers and (at least theoretically) happy and grateful recipients. As we enter the post-holiday season, it’s not time to take the foot off the pedal. Retailers must be prepared for those gifts that didn’t make the cut.
Some of these purchases come back through channels other than the one they left by, and often without a receipt. For an in-store purchase, it’s common for the customer to ask for — or the associate to suggest — a gift receipt, proactively addressing a potential return. With more mobile-driven purchases the shopper needs to remember to indicate that this is a gift. This process poses additional challenges when the customer is ordering online and having the gift shipped directly to the recipient.
With online purchases, there is likely no gift receipt or receipt at all. And what’s likely to happen is that someone will appear in the store (or call online customer service) with an item in hand, saying “I’m pretty sure this came from here, and I want to return it.”
Educate: Arming Staff For Success
And gift receipts are not the only important paperwork that may be missing. Another post-holiday situation customer service reps (CSRs) and associates are likely to battle is the case of the phantom gift-giver: “Hello? I have a box here from you, and I have absolutely no clue who sent it to me. It’s essential that I know who this is from. Can you figure that out for me?”
Assuming the CSR has immediate access to all the data surrounding that purchase, the answer is yes. Starting with the particulars of the item and the recipient’s name and address, he or she can identify the purchaser. Some systems, however, can’t deliver that information, so the CSR is stuck with saying, “Okay, I see the delivery address, but I don’t see the source of the order.”
To handle this situation, or any of the numerous possible variants of it, the CSR (or, again, the associate; this could all take place in the aisle of a store instead of on the phone) needs to know the rules: When they don’t have a receipt and maybe don’t even have a box, what do I do? Just give them a gift card? Give them cash? If cash, is it dollar amount driven — under so much, yes, above, no?
Remember, your associates are in the firing line. They want to provide the best possible service — and to do that, they need to understand the intricacies of the returns and exchanges policy and be authorized to act on it.
You also need to have — and they need to understand — a clear escalation policy. If the CSR says, I’m sorry, I can’t refund cash, I can only issue you a gift card, some customers aren’t going to embrace this response, and they’re going to push back. Under what circumstances, if any, does the CSR have the authority to go ahead and issue a credit? Having all that clearly defined and reviewed ahead of time enables a much better experience for both the associate and customer.
Today’s consumers expect the CSR to have full visibility into their purchase details. Our global research, Topography of Retail, reports that 57% of shoppers expect the CSR to know the original price of the item, 52% the purchase date and 47% the method of payment used. It is the retailers that have a contact center functionality built into their order management system that empower sales associates and CSRs to quickly remediate the situation.
Reciprocate: The Art Of The Upsell
Return rates are high — in apparel, it’s somewhere between 30% and 40% — but returns aren’t all bad news. They inevitably lead to traffic, whether on the web site, at the call center, or in the store — and traffic is opportunity. Educating your associates on the ability to shift a return/exchange/appeasement transaction into a sale is critically important.
If a customer is calling to make a return, the CSR will probably get some information on why they’re returning it: I didn’t like it, it didn’t fit, the quality wasn’t there, etc. This creates an opportunity for the CSR to make a suggestive sell. By empowering associates with quick access to transaction details and merchandise knowledge, they can offer suggestions for an alternative purchase.
Gift cards, or stored value cards, offer a particularly good opportunity for upselling. A stored value card is a physical embodiment of the brand that can fit in someone’s wallet. It’s also a call to action; it says to the recipient, “You have this, now go online or go into the store and use it.” And people do; not only that, they almost invariably spend more than the value of the gift card. They don’t see the value of the card as “This is the amount of my gift.” They see the value of the card as “This is a discount on the price of something I really want.”
So in training customer-facing staff for the post-holiday season, have them be on the lookout for gift cards. They not only generate traffic, they generate knock-on revenue. The customers, in effect, practically upsell themselves; all you must do is encourage them a little.
Ascertain Return Reasons: Leverage Your Data
Processing returns also enables the retailer, based on data collected in the warehouse and stores, to do research into its own operations. The reason for the return needs to go back into the system and ultimately be fed back to the merchant who bought the item. The customer says, “I ordered a red sweater, and it was really orange when it showed up.” So it wasn’t described well, and apparently it wasn’t photographed well, either, which means somebody didn’t do their due diligence over on the merchandising/marketing side of the house.
Finally — particularly in the case of orange sweaters that really should have been red — I recommend that you really over-invest in appeasement. Where there’s a return, there’s a problem of some sort. Sometimes — on a bad day, it can seem like a lot of the time — the problem isn’t with the retailer per se. Maybe the person who gave the gift caused the problem. Maybe it was the person who shipped it. (That’s becoming more common as we now fulfill from anywhere. Some of the organizations doing the shipping — other stores, for instance — are still learning how.)
But whoever caused it, you’re the one the customer is asking to make it right. It may involve a time investment for the retailer, but it’s a golden opportunity to acquire a new customer, or to cement the loyalty of an old one. The retailers that understand that — and that make sure their front-line associates not only understand it but are equipped to act on it — will be the real winners in the post-holiday season.
Chris Sarne is Senior Director: Global Retail Strategy & Solutions Management – Omnichannel at Oracle Retail.