A SIMPLE STRATEGY TO MINIMIZE RETURNS

If you don’t already have an e-commerce site then you’d better get on it.

With online sales breaking records there is no denying that this isn’t just a trend, it’s the future. For those of you who already sell online, you may have noticed your business revenue has recently been more reliant on retail sales than on service revenue, certainly during the Covid-19 shutdowns.

Everyone in the service industry has been hard hit in the last 10 months. If your business currently continues to operate you have most likely found indirect ways to service clients. Online skincare sales is one such avenue that has flourished and continues to outperform services for many of my clients. So many business owners have had to adapt their skillset to become quasi-internet, website, social media, shipping Gurus. However, if you are one of those businesses who shifted to an ecommerce platform, you might also be dealing with online sales returns. Yes, those pesky returns that are a reality of selling online.

I’m going to share what I have found to be a very easy and practical approach that could help limit your returns. According to Magneto IT Solutions (magnetoitsolutions.com) health and beauty products have a return rate of 22%. In contrast, according to InvesPro (invespro.com) brick-and mortar stores have a much lower return rate of 8.89%. This could be in part a result of the convenience of a “click” return rather than having to go back to a physical store with the item and the reality of not being able to test the products for suitability. There is a reason skincare practices use testers!

To help reduce online or even brick-and-mortar returns, over the last several years I have recommended this strategy to my clients and they have had great results.

For all first-time customers it can be risky to purchase a product they have never used before. One option is to consider giving away or selling a sample or travel size of the same product at the same time your customer purchases the full retail product. Offer no returns or refunds on trial products, limit returns to the full-size unopened product only.

Ensure tamper-evident seals are present on all full-size products to mitigate returns when you provide or sell testers with full size products. While it’s always disappointing to receive returns, when you are unable to resell the product it’s even more so. Being generous with testers reduces risk for the customer and they are much less likely to return an open full-size product because they already know what they will be getting.

Another option is to sell samples or testers, the value of which can be applied as a credit to retail size items. Typically, your cost on samples/travel sizes is 50% less than the value you charge, so you can afford to be generous if that brings you the retail sale. In this way your customers will be encouraged to move forward with their purchase of full retail sized items knowing they have not lost any money in the testing process.

The same strategy works well in a brick-and-mortar business. If a customer is about to move onto a new skincare regimen you may suggest they purchase smaller sizes (or a trial size kit) before committing to the substantial investment that accompanies a new collection of retail size product.

By implementing this simple sampling strategy you should see a reduction in returns. My clients who use this approach have increased their bottom line and reduced time spent dealing with returns. Good Luck!